Study: Examining the labour productivity gap between women-owned and men-owned enterprises

Released: 2021-08-30

A study published today by Statistics Canada finds that the labour productivity gap between women-owned and men-owned enterprises is partially explained by differences in prior industry experience. The study, titled "Examining the labour-productivity gap between women-owned and men-owned enterprises: The influence of prior industry experience," uses newly developed data from 2006 to 2017 to investigate differences in enterprise-level labour productivity by gender of ownership.

An increase of the economic participation of women has been identified as a major driver of economic growth, leading to increased interest in supporting the entrepreneurial activities of women. Previous research indicates that women-owned enterprises have lower labour productivity than men-owned enterprises, even when controlling for enterprise characteristics and industry. Additionally, a previous study found that owners in women-owned enterprises are less likely to have prior industry experience—a factor that could affect success of the enterprise. The current study combines these research areas to provide causal insights into the relationship between prior industry experience and labour productivity by gender of ownership.

The study finds that prior industry experience of the owner positively impacts the labour productivity of an enterprise, but the effect is much larger for women-owned enterprises. As such, the labour productivity gap between businesses owned by women and men is smaller among enterprises whose owners have prior industry experience (0.2%, Table 1) than among those whose owners do not have prior industry experience (20.9%). When combining all enterprises, the labour productivity gap between enterprises owned by women and men is 16.5%. This is lower than the labour productivity gap estimated by a model that does not account for experience.

These results show that when owners have prior industry experience, there is no significant difference in labour productivity between women- and men-owned enterprises. However, since owners in women-owned firms are less likely to have experience than owners in men-owned firms, there is still a sizeable overall labour productivity gap. These findings are relevant for policy making, in that they provide insights into the factors that influence the relative labour productivity of women-owned firms. In particular, the findings support the fact that policies aimed at reducing labour productivity gaps among groups of enterprises could target the experience of business owners, and particularly experience in the industry of the enterprise owned.

Products

The study "Examining the Labour-productivity Gap Between Women-owned and Men-owned Enterprises: The Influence of Prior Industry Experience," part of the Analytical Studies Branch Research Paper Series (Catalogue number11F0019M), is now available.

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).