5.2  Labour force participation by age

Looking at participation rates by age gives a fuller picture than just looking at overall participation. New Zealand has relatively low participation rates for both women and men aged 25-39, but relatively high participation rates for younger and for older people (Figure 16).

Figure 16 – Labour force participation in the OECD

a. women

b. men

Source:OECD Labour Market Statistics, 2003 data.

‘Top five’ is the mean participation rate of the overall highest-participating countries within each band. The top five countries for men and for women are as reported in Figure 13.

‘OECD median’ is the median participation rate within each age band; ‘OECD mean’ is the mean participation rate within each age band; ‘OECD mean#2’ is the mean participation rate within each band, weighted by the population of each country.

It is difficult to see how New Zealand differs from other countries, however, by just comparing participation rates with the OECD median or mean rates. The OECD is a diverse group of countries and it is instructive to look at the different patterns of women’s participation within the OECD. Figure 17 shows the OECD countries grouped according to the shape and height of their participation profiles.

Figure 17 – Groupings of OECD countries by women’s participation profiles

Source: OECD Labour Market Statistics, 2003 data.

The Nordic countries, together with Canada, have the highest women’s participation rates. Women’s participation profiles in these countries are similar to those of men, although slightly lower at each age. Austria, France and Germany also have an n-shaped profile, although participation rates are slightly lower on the whole, and considerably lower for younger and older women. The Nordic countries, France and Austria have the highest rates of public spending on childcare in the OECD, together with generous paid parental leave provisions (Jaumotte 2003).

New Zealand, the United Kingdom, Australia and Switzerland all show a dip in participation around the peak childbearing ages. The United States has a hint of a dip, which has gradually flattened out over time (Jacobsen 1999). As in New Zealand, this dip is characteristic of women leaving the workforce when they have young children, and returning when their children are older. On the other hand, another group of European countries—many of them predominantly Catholic countries—have a participation profile which is consistent with a pattern of withdrawing from the labour force after marriage or childbirth and not returning, or returning intermittently, later in life.

Eastern European countries tend to have a peak on the right-hand side (ie in the older age groups), which is striking but difficult to explain. The OECD (2002a) says that this is the result of increased barriers for women to participate in the labour market during the transition period from a planned economy, which appears to have disproportionately affected younger age groups. Finally, the Asian countries in the OECD, Japan and Korea, also display dips around the peak childbearing ages, although these dips are much bigger than in the Anglo countries, and women’s participation overall is much lower.

What these groupings show is that participation profiles are not randomly distributed across OECD countries. Countries with similar profiles of labour force participation often occupy the same geographical region, or share similar national values, norms or histories. These parallels should not be overstated, and the match of profiles to countries is by no means perfect, but Figure 17 suggests that similarities in the labour force participation of women may be part of wider similarities between countries.