Participation Rate and Labour Force Growth in Canada

Abstract

This paper analyzes the determinants of participation rate movements in Canada from the early 1950s through the 1970s, with a particular focus on the socio-economic determinants of the changing labour force attachment of successive cohorts of adult men and women and young persons, and develops projections of participation rate and labour force growth to the year 2000.

A wide variety of sociological and economic forces is identified as contributing to the remarkably steady growth of women's labour force participation since the early 1950s including: the rising material aspirations of families; the development of new birth control techniques; very pronounced changes in attitudes with respect to desired family size; changes in women’s personal aspirations, as reflected in the increasing average educational attainments of women; the sharply rising incidence of marriage break-down and divorce; the expansion of the service sectors of industrialized economies; and the growth in the range of household labour-saving devices and convenience products. Notably,the largest increases in women's participation rates were recorded by women with very young children present in the home. The apparent stability of the participation rate of adult men is identified as resulting from different influences working in opposite directions; namely rising average educational attainments that operated to increase their participation and improvements in social security and other factors that worked to decrease their participation.

For young persons, labour force participation patterns appear to be related to changes in the economic returns to higher education. The high monetary rewards to further education in the 1950s and 1960s were associated with declining participation rates and rising school enrollment rates; the decline in the returns to education in the 1970s was associated with declining (or more slowly rising) enrollment rates, and rising participation rates.

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Keywords: Canada, participation rates, labour force, women, men, young persons

JEL Classification: J11, J12, J13, J14, J16, J21, J24, J26, J31, J32