11-010-XIB
Canadian Economic Observer
June 2006

From she to she: changing patterns of women in the Canadian labour force

by Francine Roy*

From the end of the second world war until recently, a surge of women entering the labour force helped boost Canada’s overall labour force participation rate in every non-recessionary year.¹ In the initial decades of this period, women in Ontario and the west had spearheaded this movement. Over the last decade, however, women in eastern Canada have taken the lead, driven by Quebec, while women in the western provinces have participated less in the labour force.

The long-term increase in women’s participation rate was temporarily interrupted in 2005, due to this retreat in western Canada because of declines in participation among younger women, despite the regional boom. As a result, the participation rates of women in the east and west are converging; with the spread between the highest and lowest half what it was in 1976 (Figure 1).

Figure 1

This article looks at the factors historically associated with the trends east and west of the Ottawa River. Women to the east have posted the largest gains in labour force participation since 1989, the year when the trends in eastern and western Canada began to converge. The convergence in trends between Quebec and Alberta is particularly striking.

The rising participation rate of women in eastern Canada appears associated with greater use of day care and higher education levels in Quebec, lower birth rates in the Atlantic provinces, and a lower proportion of immigrants than in the west (Canadian-born women have much higher participation rates than immigrants). Another factor was the concentration of job growth in areas less suited to women, who prefer white collar jobs and those with fewer hours. At the same time, women in western Canada also are moving in growing numbers into older age groups, which reduces participation rates.

Background

The slowdown in labour force participation of adult women in western Canada is reminiscent of the realignment posted during the boom just after World War II, even as industry then (like today) had a growing need for more labour. At that time, the withdrawal from the labour force was concentrated among men over 65 years, almost half of whom were active in the labour force (despite a life expectancy at birth of only 66 years). As men retired from the labour force over the following decades, adult women between 25 and 44 years took their place (Figure 2).

Figure 2

The rapid increase in the participation rate of prime-aged women continued unabated until the 1990s. Then it began to level off, especially in the prairies and BC, where in every province in 2005 it was below its previous highs. As a result, overall female participation rates stopped rising in all four western provinces. This slowdown in participation rates is surprising in light of the boom in growth in the west and increasing signs of labour shortages in crucial sectors of the economy (participation rates did start recovering early in 2006).

Mothers with young children

The most striking gap in the trend of participation rates between eastern and western Canada is for women with at least one child under six years old. In Alberta, participation of these women fell by a full percentage point in 2005 to 64.9%. This is three points lower than its peak in 1999, and 10 points below the rates in Quebec and Atlantic Canada.

If the participation rate of women with young children in Alberta and BC had risen in tandem with Quebec, 30,000 more women would be in their labour forces in 2005 (Table 1), mostly in the prime working ages between 25 and 44. In Alberta’s red-hot labour market, this increase in the labour force would have boosted the employment rate for 15 to 64 year-olds by a full percentage point. This is considerable given Alberta’s 3.4% unemployment rate in May 2006, the second lowest in North America.

Participation rates of mothers in the prairies and Quebec have switched positions since 1992 (Figure 3). In 1992, the prairies ranked first in the participation rate of women with children less than six years, while Quebec was last. In 2005, these positions were reversed, with Quebec first and the prairies last. BC had the second lowest participation rate, while the Atlantic provinces have the second highest.

Figure 3

This reversal reflects increases in Quebec and declines for the prairies. The participation rate of Quebec women with young children has completely eliminated its traditional lag behind the rest of the country. In 1976, their participation rate was well below the Canadian average (30.0% versus 35.6%), before catching up to the national average by 1999. Equally important was the speed of this increase, especially this decade. Since 2000, it has accelerated further and surpassed the national average by 4.2 points (76.0% versus 71.8%) in 2005.

The lowest participation rate was for mothers in Alberta, which at 64.9% was over 10 points less than in Quebec. Manitoba was next at 68.7%, followed by Newfoundland (68.8%), BC (69.0%) and Saskatchewan (70.9%). Ontario equalled the national average at 71.9%. These relative standings are the complete opposite of the 1960s and 1970s, when participation rates in the west were ahead of the east.

Table 1 Women with children under age 6

Birth Rates

An increase in infants can be associated with more mothers staying home: for example, during the start of the post-war baby boom, the participation rate of women fell from 24.7% in 1946 to 23.2% in 1950.

The prairies generally have the highest birth rate in the country, with 48 births for every 1000 women (aged 15 to 49) versus 41 in the rest of Canada in 2005. In particular, Alberta women may have left the labour force to look after their children full-time since it is the only province where the number of children aged 0 to 5 increased after 1999 (Figure 4). There were an additional 8,175 infants (to 121,550) less than 3 years old just since 2002. Conversely, birth rates were the lowest in the Atlantic provinces, reducing the number of infants under 3 years by 2,483 (to 65,204) after 2002.

Figure 4

Day Care

While it had more infants, Alberta has the smallest share of children in all non-parental child care at only 43%. In 2004, the province had 47,959 day care spaces for 163,400 mothers with pre-school age children, and day care capacity fell outright over the past decade.

Mothers in the labour force in Quebec multiplied rapidly after its $5 day universal care system was introduced in 1997. The province had 321,732 day care spaces in 2004, triple 1992 levels. Between 2001 and 2004, about 60% of all day care spaces added in Canada were in Quebec, which has 43% of all Canadian children registered in day care.² The share of children in Quebec’s day care centres rose to 52% in 2003, almost double the national average of 28%.³

Table 2 Number of supervised day care spaces, 1992 to 2004

One reason Quebec families use day care more is that they are charged less. In 2002, families using day care in Quebec spent an average of $1,391, versus the national average of $2,337 (and $2,215 in Alberta). Day care is a large part of the expense of raising a child: excluding child care, kids cost about $5,000 a year (including $1,200 for food).⁴

Education

Different education levels also affect the trends of women’s labour force participation in eastern and western Canada, as more schooling is often positively correlated with participation rates. Quebec has pulled ahead in education. Since 1999, a larger share of Quebec women aged 25 to 44 years had some post-secondary education. Not only are more women in Quebec highly educated, but they participate more in the labour force than the rest of Canada (87.8% versus 83.3% in Alberta and 83.5% in BC for women with a university degree).

The increase in participation rates for Quebec women with post-secondary education was led by those who attended community colleges. This reflects the highest community college attendance in the country. It also helps explain why Quebec women now have the most post-secondary education in the country: as recently as 1990, they had the least (Figure 5).⁵ University attendance is comparable with the rest of the country at the undergraduate level, but is much higher for postgraduate studies. Post-secondary education was lowest in Alberta and BC for young women, falling behind even the Atlantic provinces. The increase in labour force participation associated with higher education levels reflects higher pay: in 2000, before-tax earnings for university and college grads were 77% and 15% higher, respectively, than for high school grads.

Figure 5

At the same time, the participation rate for Quebec women with a high school education rose even faster than for university grads, catching up to the level in the rest of the country. The trend of the participation rate by education level has been the opposite in Quebec and Alberta. In Quebec, participation rates rose as education levels fell: for those with less than high school, it rose 5.9 points to 65%. In Alberta it declined 6.9 points, also to 65%.

Age Structure

The population’s age structure also has a considerable impact on overall participation rates. In recent years, our population has been shifting to those age groups where participation rates are the lowest, notably young adults and people over 45 years. This can be characterized as a U-shaped change in population by age.

Figure 6

Since 1999, only 35,000 women 25 to 44 years old were added to the labour force, reflecting a slowdown in the overall population in this age group (it fell outright by 84,000). Labour force growth has been concentrated among aging boomer women, including those who did not always pursue a career and are now entering the labour force. Between 1999 and 2005, almost 80% of labour force growth was accounted for by women aged 45 to 64: this group expanded by 721,000 over this period, with half 55 years old or over.

Figure 7

These trends were amplified in the west. On the prairies, the female labour force 25 to 44 fell 25,000 after 1999, while 45 to 64 year-olds increased 123,000. The net result was that the female adult labour force 15 to 64 years grew less on the prairies than elsewhere between 1999 and 2005 (10% versus 15%). This gap represents 60,000 fewer women, equivalent to 2% of all jobs.

The female population aged 25 to 44 also fell markedly in BC, down 24,000, while older women 45 to 64 rose 112,000. As well, BC posted a sharp decrease in young women in the labour force. If BC’s participation rates had held steady at its peak of 73.7% in 1990, 23,000 more women would be in its labour force.

Ontario and Quebec boosted the labour force for all age groups, even as the number of women 25 to 44 fell outright. It has continued to grow early in 2006. The labour force of Quebec women rose 18,000, despite a 20,000 drop in the number with children under six since 1999. Almost half of the 38,000 mothers in Canada who rejoined the labour force after 1999 were in Quebec.

Job Composition

Differences in the type of jobs created may also help explain changes in the east and west participation rates. Services employ almost as many women as men. In goods, however, there are four men for every woman. As well, women hold most part-time jobs (most of which are in services).

Figure 8

The resurgence of the prairie and BC’s resource sectors has generated jobs in areas where women have less of a presence, notably mining, transportation and utilities. Between 1999 and 2005, blue-collar jobs held by men in BC and the prairies and white-collar jobs for women rose at a similar rate. In Quebec and the Atlantic provinces, white collar jobs for women grew three times faster than blue collar jobs held by men.

At the same time, part-time jobs held by white collar women rose faster in Quebec, while a slightly larger share of unemployed women in Alberta than in Quebec were looking for a part-time job (21% versus 16%). This suggests that both supply and demand dampened Alberta’s female labour force.

Immigration

Participation rates for women in Quebec and the Atlantic provinces also were higher because they have fewer immigrants than the rest of the country⁶: immigrants’ participation rate was lower than for native-born women 25 to 44 year (75% versus 82.4%). Recent immigrants arriving from 1996 to 2001 have the lowest participation rate at 63.9%.

In Canada, about 20% of women aged 25 to 44 were immigrants, ranging from 30% in Ontario and BC to 17% in Alberta to around 10 % in Quebec and Atlantic Canada. If the participation rates of immigrant women equalled the native-born, almost 200,000 more prime-aged women would be in the labour force.

Conclusion

For decades, the growing number of women in the labour force has been the primary source of increased labour supply for Canada’s economy. While participation rates remain high, they have slowed in recent years for a number of reasons. Most of this slowdown has been concentrated in the prairies and BC, aggravating the shortage of labour in these areas. Conversely, women in eastern Canada continue to enter the labour force in growing numbers, especially in Quebec. Such increases will increasingly be needed as our society copes with the aging of the population in the coming decades.

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Notes