gaining ground in the labour force - rbc€¦ · from sheryl sandberg’s “lean in” to...

93619 The State of Women in Canada’s Economy: In Pictures March 2017

Remember Justin Trudeau’s quip about why he named an equal number of men and women to his cabinet (“Because it is

2015”)? That’s just one example of how efforts to raise women’s profile in economic and political life have taken centre-stage.

From Sheryl Sandberg’s “Lean In” to policymakers’ efforts to put more women on corporate boards, the issue of female partic-

ipation in the economy has come to dominate policy discussions as never before. The spotlight on gender issues has highlighted

ongoing gender disparities, including the wage gap and the lack of women in executive positions.

Further strides towards economic equality could produce sizeable economic benefits for Canada. But first, it’s important to

understand the state of play. This chart book aims to provide a snapshot of the role of women in Canada’s economy.

Key points:

Laura Cooper Economist | 416-974-8593 | [email protected]

“Equal pay and better economic opportunities for women boost economic growth—creating a bigger pie for everyone to share, women and men alike. Better opportunities for women also promote diversity and reduce economic inequality around the world. It is an economic no-brainer”. -Christine Lagarde, Managing Director

The International Monetary Fund

November 14, 2016

• Female participation in the workforce in Canada is the highest amongst G7 countries.

• The wage gap has narrowed, but it’s still there: for full-time workers of prime working-age, females earned 88 cents, on average, for every $1 earned by males.

• Boosting women’s participation in the labour force could partially offset demographic trends that threaten Canadian growth.

• Women are making headway in typically male-dominated fields.

• Fewer women are working part-time due to family obligations, but they are still far more likely to work part-time than men.

• Less than 3% of females head incorporated businesses in Canada, which is half the rate of males. Only 1 in 5 directors of large publicly listed companies in Canada are women.

• The share of women-owned businesses in Canada is growing but still falls well behind coun-tries including Mexico and Japan.

• The pipeline for leadership talent is bright. Canada leads OECD countries both for the share of women holding post-secondary degrees and involved in early-stage firms.

• While many Canadian women pursue post-secondary education, the number of women opting to study in the STEM fields remains low.

• Women in Canada carry most of the burden of unpaid work.

Women| March 2017

2

Gaining ground in the labour force

Canada had the highest female participation rate of G7 countries over the past decade. The

female participation rate in Canada was well above the OECD average of 51.6% in 2015 and

is amongst the highest of this group, next to Norway, Sweden and Iceland.

After rising by nearly 20 percentage points over the three decades leading up to the 2008/09

recession, the participation rate of females in Canada’s labour force began to decline before

stabilizing more recently. Rising educational attainment and changing attitudes to family

structure underpinned the prolonged rise; however, an aging population means the peak is

likely in the past.

62% of Canadian females participate in the workforce.

The Canadian rate compares to 57% in the United States.

10

20

30

40

50

60

70

80

90

Turkey

Italy

Mexico

Greece

South Africa

Belgium

Chile

Poland

Japan

Czech Republic

OECD countries

France

Korea

Slovenia

Slovak Republic

Ireland

Hungary

Spain

Portugal

Luxembourg

Germ

any

Austria

United States

United Kingdom

Denmark

Netherlands

Australia

Israel

Canada

Switzerland

Russian Federation

New Zealand

Finland

Estonia

Norw

ay

Sweden

Iceland

Female labour force participation in 2015, %

Exhibit 1: Female participation in the Canadian workforce is relatively high...

Source: OECD, RBC Economics Research

40

45

50

55

60

65

1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 2016

Canada United States

%

Exhibit 2: ...but has steadied in recent years after rising for three decades

Source: Statistics Canada, RBC Economics Research

Women| March 2017

3

Closing the gap between male and female participa-tion rates could

boost GDP by 4%

Since 2000, the participation rates of older Canadian females have increased sharply, albeit

from relatively low levels. Going forward, as an increasing share of the population reaches

an age that is typically associated with lower labour force participation, downward pressure

on the overall headline participation rate is expected to intensify.

The demographic shift taking place in Canada raises concerns about the ability to sustain

labour force gains which have contributed to economic growth over past decades. Important-

ly, a further narrowing and eventual elimination of the gap between female and male partici-

pation rates over the next 20 years could act to partially offset the projected slowdown in

economic growth.

A record 32% of females aged 55

and older partici-pated in the labour force in 2016, up

from 19% in 2000.

-5

0

5

10

15

20

20 to 24 years 25 to 29 years 30 to 34 years 35 to 39 years 40 to 44 years 45 to 49 years 50 to 54 years 55 to 59 years 60 to 64 years 65 years and

over

Exhibit 3: Shift to females staying in the labour force longer

Percentage point change in female labour force participation rates from 2000 to 2014


45

50

55

60

65

70

75

80

85

1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035

% of Population in the Labour Force

Exhibit 4: Convergence of participation rates can boost growth

Projected


Projected convergence of female to male participation rates could

boost economic growth

Males

Females

Women| March 2017

4

Breaking barriers: the gender wage gap

Despite gains made by women in the workforce, there exists a gender wage gap in Canada. It

was relatively high amongst OECD countries in 2015, ranking next to Korea, Japan and

Finland and was well above the OECD average.

The wage gap has held steady in Canada in recent years after narrowing over the preceding

decade. Increased educational attainment, greater work experience and rising earnings in

female-dominated occupations likely contributed to the improvement.

A further narrowing of the wage gap could yield knock-on benefits for the economy. If fe-

males aged 25 to 54 and working full-time had earned the same hourly wage as their male

counterparts, this cohort’s aggregate earnings would have been a whopping 17% higher in

2015. Notably, this does not account for the uneven distribution of males and females across

industries, but in aggregate, it does signal economic gains are being left on the table.

The wage gap suggests economic gains are being left

on the table.

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Exhibit 6: Closing the earnings gap could boost economic growth

Difference (RHS)

Actual female earnings

If Female = Male Wages

Aggregate earnings of full-time female workers aged 25 to 54, Billions $


Earnings difference between actual and simulated wages for females,

Billions $

At 20%, Canada’s wage gap was higher

than the OECD average of 15% in

2015.

5

10

15

20

25

30

35

40

Belgium

Hungary

Luxembourg

Slovenia

Italy

New Zealand

Denmark

Norw

ay

Turkey

Greece

Poland

Iceland

Netherlands

Slovak Republic

Ireland

Australia

OECD - Average

Czech Republic

Switzerland

Germ

any

United Kingdom

United States

Austria

Mexico

Portugal

Canada

Finland

Japan

Estonia

Korea

% difference between male and female median wages, 2014

Exhibit 5: Gender wage gap is higher in Canada than the OECD average

Source: OECD, RBC Economics ResearchDifference between male and female median wages divided by the male median wages

Women| March 2017

5

Factoring in full-time workers of prime-working age, the wage gap has gradually narrowed

since the late 1990s. In January 2017, for every $1 of male hourly earnings, females earned

$0.88, on average. This 12% shortfall compared to a nearly 20% gap at the turn of the mil-

lennium.

The wage gap varies on an industry-by-industry basis in Canada. It was largest for goods-

producing sectors in 2015, although some service sectors have a larger wage gap than the

average across industries such as in the professional, scientific and technical sector.

The gap between male and female earnings narrowed in some industries over the past decade,

but has deteriorated in others. It widened in goods-producing sectors such as construction and

agriculture while the largest improvement was seen in business, building and other services.

The wage gap is lower for full-time workers of

prime working age than the gender gap

for all employees.

-12

-10

-8

-6

-4

-2

0

2

4

6

8

Bus

ines

s, b

uild

ing

an

d o

the

r

Hea

lth

car

e a

nd

so

cial

ass

ista

nce

Oth

er s

ervi

ces

(ex.

pu

blic

adm

in)

Fina

nce

, In

sura

nce

, Rea

l Est

ate

Info

rmat

ion,

cu

lture

an

d r

ecre

atio

n

Serv

ice

s-p

rod

uci

ng s

ecto

r

Who

lesa

le a

nd r

eta

il t

rad

e

All

ind

ustr

ies

Pro

f, s

cie

ntif

ic, t

ech

nica

l

Pu

blic

adm

in

Ma

nu

fact

uri

ng

Uti

litie

s

Tra

nsp

ort

atio

n an

d w

areh

ous

ing

Goo

ds-

pro

duc

ing

Ed

uca

tion

al s

ervi

ces

Con

stru

ctio

n

Agr

icul

ture

Acc

om

. an

d f

oo

d s

ervi

ces

Exhibit 8: ...and has improved in some industries...

% change in wage gap in 2015 from 2005


Wage gap narrowed

Wage gap widened

0.05

0.07

0.09

0.11

0.13

0.15

0.17

0.19

0.21

Gap between male and female average hourly wages of full-time workers aged 25-54


Exhibit 7: Gap has improved for full-time workers of prime-working age...

Wage gap trends have differed across

industries over the past decade.

Women| March 2017

6

The share of females working part-time is more than double the rate for males.

0

5

10

15

20

25

30

35

197

6

197

7

197

8

197

9

198

0

198

1

198

2

198

3

198

4

198

5

198

6

198

7

198

8

198

9

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

201

5

201

6

Exhibit 10: Females are more likely to be employed part-time...

Females Males

Part-time workers as % of employed by gender


Uncovering employment trends

Only 1 in 5 women work in the goods-producing sector with the lowest shares in construc-

tion and forestry, fishing, mining, oil & gas.

Instead women account for close to 55% of jobs in the services sector including industries

that tend to pay lower wages such as accommodation and food services.

More than a quarter of employed females worked part-time in 2016. This share has remained broadly unchanged since the early 1980’s. At the same time, the share of males working part-time has increased, although remains well below the rate recorded for females at 12.6%.

Women make up the majority of workers in

the fields of health care, social assistance

and education.

0 10 20 30 40 50 60 70 80 90

Construction

Forestry, fishing, mining, quarrying, oil and gas

Goods-producing sector

Transportation and warehousing

Utilities

Manufacturing

Agriculture

Professional, scientific and technical services

Business, building and other support services

Information, culture and recreation

Total, all industries

Wholesale and retail trade

Public administration

Other services

Finance, insurance, real estate

Services-producing sector

Accommodation and food services

Educational services

Health care and social assistance

Exhibit 9: Women account for the majority of jobs in health care% share of employment, 2016


Women| March 2017

7

Of women working part-time in 2015, 16% were doing so to care for children or for other personal responsibilities. This was down from 21% in 2000, but compared to less than 3% for males. Females in school accounted for close to one third of part-time workers while 1 in 4 females working part-time were doing so because they could not find full-time work.

Women with children increasingly entered the workforce over the 1970s, 1980s and 1990s, contributing to the headline female participation rate rising over this period. The upward trend in participation rates amongst these groups have moderated over the past decade;

however, women with children are increasingly entering the labour force. Since 2000, mothers with children under 3 have recorded the highest increase in workforce participation among women.

0

5

10

15

20

25

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Exhibit 11: ...although fewer working part-time due to family reasons*

% of part-time workers by gender


* Caring for children or other personal or family responsibilities

Females

Males

0.0

1.0

2.0

3.0

4.0

5.0

6.0

Youngest child less than 3

years

Youngest child 3 -5 years Youngest child 6 - 15 years No children under 16

Exhibit 12: More women with children participating in the workforce

Percentage point change in female labour force rates from 2000 to 2016


Fewer women are working part-time due to family obli-gations, but this is

still well above males.

Women with young children are in-

creasingly entering the workforce.

Women| March 2017

8

Women accounted for bulk of job

gains in 2015 and 2016.

3/4 of prime working-age

females hired in 2016 were for

full-time positions.

Females accounted for the majority of employment gains in 2015 and 2016, in sharp con-

trast to the previous two years. Employment rose by 121K in 2016 for females compared to

108K for males in Canada.

In sharp contrast to recent years, females aged 25 to 44 accounted for the bulk of hiring

gains in 2016. This cohort saw employment grow by 92K jobs.

Encouragingly, three quarters of the hiring gains recorded by females of prime working-age

in 2016 were full-time positions. This represented the highest increase since 2012.

-300

-200

-100

0

100

200

300

400

500

600

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Exhibit 13: Females accounted for majority of jobs in 2015 and 2016...

Males Females


Employment gains, thousands

-100

-50

0

50

100

150

200

250

300

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Exhibit 14: ...and predominantly full-time positions

Full-time Part-time


Net employment growth of 15-64 year old females, Thousands

Women| March 2017

9

Lagging in leadership Despite accounting for close to half of the labour force, the share of women heading incorpo-rated businesses is well below that of males (2.6% vs. 6.5%). That said, relative to other G7 countries, Canada performs well in this regard, coming next to Italy.

A greater share of highly educated women participating in the workforce signals a larger talent pool for senior positions in the future. While female board membership in Canada has been increasing, it was still only 20.8% in 2015, below several OECD countries. According to the International Monetary Fund, electing one additional female to a corporate board is associated with between 8 and 13 basis points higher return on assets*.

* “Unlocking Female Employment Potential in Europe: Drivers and Benefits”. IMF, March 2016.

0

1

2

3

4

5

6

7

8

9

Italy Canada Germany OECD average France United Kingdom United States Japan

Exhibit 15: There are fewer females heading incorporated businesses...

Females Males


Share of employed who are employers, 2014

0

5

10

15

20

25

30

35

40

45

50

Exhibit 16: ... and representation of women on boards remains low


Share of seats helds by women on boards of publicly listed companies

Less than 3% of females lead

incorporated busi-nesses in Canada, less than half the

rate of males.

Only 1 in 5 board members on publicly-listed companies in Canada were female

in 2015.

Women| March 2017

10

Tapping into an underutilized resource

Female majority-owned business establishments have made headway in the Canadian SME landscape with the share of firms with greater than 50% female ownership edging up to 15.7% in 2014 from an estimated 15.5% in 2011 and 14.9% in 2007. This is well below oth-er countries, however. The share of sole-proprietor women-owned firms was above 40% in Mexico, close to 35% in Sweden and Spain and just below 30% in Japan.

For small and medium-sized businesses as a whole, one in ten high-growth firms were fe-male majority-owned and female owned firms accounted for 8% of SMEs in the ICT sector (more than 60% of firms in this field were solely owned by males). Firms with female majority-ownership tend to be found in the services sector. Close to 1 in 4 firms in this sector are majority-owned by females. This compares to only 9% and 5% of SMEs in manufacturing and construction, respectively.

Only 15.7% of small and medium-

sized firms were female-majority owned in 2014.

Female majority-owned firms

predominantly in the services sector.

67.5

17.6

14.9

66.4

18.1

15.5

64.7

19.7

15.7

0

10

20

30

40

50

60

70

80

Male majority-owned 50/50 Female majority-owned

Exhibit 17: Much ground to be covered for female entrepreneurship...

2007 2011 2014

Ownership of Canadian small and medium-sized businesses by gender


Female majority-owned firms:

15.7% in 2014

0

5

10

15

20

25

Exhibit 18: ...with these firms predominantly in the services industry

Female majority-owned firms as % of firms by industry


* Information and cultural industries, real estate, administration, health care, arts, entertainment recreation

Women| March 2017

11

The share of patent applications from women around the globe amounted to nearly 30% in 2015, an unremarkable figure but up from 17% two decades prior. Females in Canada ac-counted for less than one quarter of patent applications over the 2011 to 2015 period; only a 5 percentage point improvement from the late 1990s. This put Canada in the bottom half of the countries examined and on the lower range in terms of increases on a country-by-country basis over the past two decades.

Addressing the lack of female inventors is important for Canada’s economic future for a number of reasons. Innovation - loosely defined as a new product, service or process, that which a patent protects—is an important facet for greater economic growth. Despite Canada lagging behind its international peers, the pipeline for female talent is en-couraging. The share of the female population involved in business start-ups in 2016 was the second highest amongst OECD countries. It was 13.5% in Canada, lower than the 20.3% for males, but above the OECD average of 7.7%.

0 5 10 15 20 25

Germany

Italy

France

Spain

Greece

Hungary

Slovenia

Switzerland

Finland

United Kingdom

Portugal

Sweden

Luxembourg

Israel

Ireland

OECD average

Austria

Poland

Netherlands

Latvia

Mexico

Turkey

United States

Australia

Estonia

Canada

Chile

Exhibit 20: Canadian females engaged in start-ups is high amongst OECD

% of female population involved in early-stagebusinesses

Source: Global entrepreneurship monitor 2016/2017, Statista, RBC Economics Research

0

10

20

30

40

50

60

Exhibit 19: Share of international patent applications held by women

Source: WIPO Statistics Database, RBC Economics Research

%

Women accounted for 24% of

international patent applications in

Canada in 2015.

Females are engaged in early-

stage businesses in Canada.

Women| March 2017

12

Bright prospects for the (female) talent pipeline Females account for an increasing share of STEM university graduates (science, technology, engineering and mathematics). They make up the majority of science and technology degree holders and are gaining ground in traditionally male-dominated roles including civil engi-neering where 1 in 4 young workers are female*.

There is still much ground to be covered, however. Nearly 1 in 5 male college graduates study engineering compared to only 2% of females. Despite gaining ground in the fields of science, technology, engineering and mathematics, the labour market outcomes differ between male and female degree-holders. Females with a degree in a STEM field, on average, earn more than non-STEM female degree holders, but the earnings for males in these fields are higher**.

* “Gender differences in STEM programs at university”. Statistics Canada, December 2013. ** “Women in Canada: Education, qualifications, skills and technology”. Statistics Canada, July 2016.

Close to 60% of science and tech-nology graduates

are female.

Females with a STEM degree earn $9.1K less, on aver-

age, than males.

0

50

100

150

200

250

Females Males

Exhibit 21: Females trail behind males in STEM fields of study...

Science and technologyEngineeringMathematics and computer science

Thousands of STEM university graduates aged 25 to 34, 2011


0

10

20

30

40

50

60

70

STEM Non-STEM Sccience Technology Engineering Math and computer

science

Exhibit 22: ... and labour market outcomes differ within these fields

Females Males

Median wages and salaries for full-time workers, Thousands of dollars, 2010


Women| March 2017

13

0 10 20 30 40 50 60 70 80

Architecture, engineering and related technologies

Mathematics, computer and information sciences

Personal improvement and leisure

Personal, protective and transportation services

Other instructional programs

Business, management and public administration

Physical and life sciences and technologies

Agriculture, natural resources and conservation

Humanities

Visual and performing arts, and communications technologies

Social and behavioural sciences and law

Health and related fields

Education

Exhibit 23: Females are the majority of education and health students...

% of university students by field of study, 2014


-30 -20 -10 0 10 20 30 40 50

Other instructional programs

Visual and performing arts, and communications technologies

Mathematics, computer and information sciences

Humanities

Business, management and public administration

Architecture, engineering and related technologies

Education

Social and behavioural sciences and law

Physical and life sciences and technologies

Health and related fields

Agriculture, natural resources and conservation

Personal, protective and transportation services

Exhibit 24: ...and account for rising share in some male-dominated fields

Percentage point change in share of students from 1994 to 2014


Millennial females account for the majority of university students studying nursing and edu-cation. Conversely, females comprise only one-third of students in math, computer and in-formation science, a figure that has remained broadly unchanged over the past two decades.

Engineering remains the 2nd most popular field of study for males with information, commu-nication and technology (ICT) ranking 6th. For females, these fields rank 7th and 15th, re-spectively. Females are accounting for a higher share of students in some male-dominated fields. En-couragingly, females aged 25 to 34 make up an increasing number of employees in fields such as civil engineering (26%), financial management (46%) and investment analysis (43%).

One-third of university students studying math and computer science

are female.

The share of females studying ICT in university

has remained broadly unchanged over two decades.

Women| March 2017

14

More than half of university and college students in Canada are female, a trend that has been in place since the early 1990s. As a result, Canada leads the pack of OECD countries for fe-males aged 25 to 64 with post-secondary degrees. The 60% rate in Canada compares to the 37% average across OECD countries.

Still much ground to cover...

Women in Canada have made strides in achieving advancements in the workforce, yet there are still significant gains to be made and much ground has yet to be covered. The rise of flex-ible work arrangements has likely played a role in encouraging women to participate in the workforce; however, women still account for the majority of time spent in unpaid work. In Canada, females devote 254 minutes per day to unpaid work compared to 160 minutes for males. Encouragingly, the gap between the two (94 minutes) was lower in Canada than the average across OECD countries (at 134 minutes), although was higher than some countries—notably Denmark (57), Norway (49) and Sweden (53).

Close to 60% of post-secondary stu-

dents in Canada are female.

Despite advances, structural challenges persist for females in

the workforce.

0

50

100

150

200

250

300

350

400

Exhibit 26: Females still spend more time in unpaid work

Females Males


Number of minutes spent on unpaid work

0

10

20

30

40

50

60

Exhibit 25: Leading the pack for females with post-secondary education


% of females aged 25 to 64 with post-secondary degree, 2015

Women| March 2017

15

The material contained in this report is the property of Royal Bank of Canada and may not be reproduced in any way, in whole or in part, without express authori-

zation of the copyright holder in writing. The statements and statistics contained herein have been prepared by RBC Economics Research based on information

from sources considered to be reliable. We make no representation or warranty, express or implied, as to its accuracy or completeness. This publication is for the

information of investors and business persons and does not constitute an offer to sell or a solicitation to buy securities.

®Registered trademark of Royal Bank of Canada.

©Royal Bank of Canada.

gaining ground in the labour force - rbc€¦ · from sheryl sandberg’s “lean in” to...

Documents