Analysis: U.S. Workforce Missing 5M Women Due to Lack of Support for Parents

An analysis of labor force participation trends in Canada and the United States led the authors of a Nov. 13, 2018, Federal Reserve Bank of San Francisco Economic Letter to conclude that “employment and social policies in Canada have made it easier for women to remain in the labor force while raising children.”

FRBSF President and CEO Mary C. Daly and her co-authors point, in particular, to universal child care, universal preschool, tax relief for spousal income and up to 78 weeks of job and wage protections for new parents who take leave as reasons women in Canada “maintain a continuous employment relationship.”

The determination followed from the observation that the current labor force participation rates for individuals between the ages of 25 and 54 in Canada and the United States are, respectively, 87 percent and 81.7 percent. Fully three-quarters of the difference results from more women in the prime working age cohort remaining employed in Canada.

By adopting Canadian-style parental support programs, Daly et al. argue, the United States could “catch up with Canada’s labor market participation rate … [and] add as many as 5 million prime-age workers to its labor force.”

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