Female Labor Force Participation Rates

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pation rate is determined by comparing the actual labor force with the potential labor force (age-eligible population). The potential labor force is the entire population less people under 16, and people who are institutionalized. The actual labor force is the people who are actually employed or seeking employment.

Over the past fifty years, labor force participation rates of women in general have been on the rise. However if one were to be more thorough, they would look at women in the different age groups. As Mcconnell, Brue and Macpherson suggest, we will break the women up into four different age groups. These groups are 20 to 24, 25 to 54, 55 to 64, and finally 65 and over. Since 1950, the age groups with the sharpest increases in the labor force participation rates are the 20 to 24, and the 25 to 54.
As one can clearly see in the chart above the participation rates of women in 20 to 24 and the 25 to 54 age groups have had the highest rates of increase over the fifty years time period that the chart covers. The 55-64 age group has also risen but not as sharply as the first two age groups. The only group that seems to be relatively unchanged is the 65 and over age group. They have stayed around the ten percent mark over the past 50 years. During this period of time, 1950 to 2000, the total number of females in the labor force has increased by approximately 46 million. Of this total increase, about 67 percent were married women.

The participation rates of married women have been on the rise over the past 50 years. This is a surprising turn of events, if one considers the fact that since World War II, real wage rates and income of married males has been generally rising. These factors coupled with the fact that cross sectional studies reveal that participation rates of married women are inversely related to their husbands income, does make this an interesting phenomenon. Simply put, this states that couples in the lower inc...