Flex Work Research Centre

The recession the United States economy entered in December of 2007 is considered to be the most severe downturn the country has experienced since the Great Depression. The unemployment rate reached as high as 10.1 percent in October 2009 – the highest we have seen since the 1982 recession. In this paper the authors examine the severity of this recession compared to those in the past by examining worker flows into and out of unemployment taking into account changes in the demographic structure of the population. The authors identify the most vulnerable groups of this recession by dissagregating the workforce by age, gender and race. The authors find that adjusting for the aging of the U.S. labor force increases the severity of this recession. Their results indicate that the increase in the unemployment rate is driven to a larger extent by the lack of hiring (low outflows), but flows into unemployment are still important for understanding unemployment rate dynamics (they are not as acyclical as some literature suggests) and differences in unemployment rates across demographic groups. The authors find that this is indeed a “mancession,” as men face higher job separation probabilities, lower job finding probabilities and, as a result, higher unemployment rates than women. Lastly, there is some evidence that blacks suffered more than whites (again, this difference is particularly pronounced for men).

Men’s and women’s employment effects due to changing economic conditions can also take place due to gender differences in the division of part-time and full-time work and labor market attachment and its correlation with occupational segregation. In both Europe and the US, women have a considerably lower presence in full-time work compared to men and concentrate in temporary and part-time jobs, which are more sensitive to economic downturns and upswings. Occupational segregation is also positively correlated with the share of part-time jobs, as these jobs tend to be in occupations traditionally held by women.