Do Gender Disparities in Employment Increase Profitability? Evidence from the United States

Abstract

This paper investigates whether the contribution of the declining share of wages in national income to the upswing in profitability between 1982 and 1997 in the United States was aided by the growing incorporation of women into employment. The analysis finds that women helped moderate the decline in the aggregate wage share. The reduction in gender pay disparity overwhelmed the negative effect of women's growing share of market work on the wage share. However, in (one-digit) sectors where wage shares fell, women did not contribute to restraining the fall, indicating that the aggregate outcome was the net result of distinct sectoral trends in women's employment conditions. We argue that the perverse process of labor productivity falling faster than the real wage in the service sector may have played a key role in shaping the aggregate outcome. The post-1997 trends in the US are discussed in a postscript.Profitability, feminization of the labor force, gender wage gap,

Gender Employment Disparities, Financialization, and Profitability Dynamics on the Eve of Italy's Post-2008 Crisis

“…We aggregate sectors to make our results comparable to those in Zacharias and Mahoney (2009), where it was found that, in the US, structural change contributed to the wage share dynamics only by 10 percent between 1982 and 1997. Table 4 shows that it had a much greater role in Italy from 1994 to 2005, when the economy was shifting from sectors where income distribution had a positive contribution to the aggregate wage share (especially manufacturing and trade) to sectors with negative contributions (especially financial intermediation).…”

“…Therefore, the Italian workforce also experienced an increasing feminization. Zacharias and Mahoney (2009) phenomenon in the US, including an attempt to defend family living standards from declines in men's compensation, social and educational factors changing women's preferences, declines in fertility and marriage rates, and increases in the rate of divorces. Italian society went through similar changes in the past decades.…”

“…10 Mita Marra (2012) provides further data on labor market issues by gender in Italy. 11 Zacharias and Mahoney (2009) also provide counterfactual analyses by keeping the gender wage gap and the share of women in total working hours at their initial level. Alice Tescari (2012) performs similar exercises; however, since these variables did not markedly change over the period of observation, actual results are not dramatically different from counterfactual ones.…”

“…3 We do so by following in particular the example of Ajit Zacharias and Melissa Mahoney (2009), which is our main reference. To our knowledge, this is the first study to highlight gender issues in the connection of structural change and aggregate capital profitability.…”

“…The change in the gross profit rate and its components, US and Italy (percentage points) Notes: Figures for the US are reproduced fromZacharias and Mahoney (2009).…”