Women’s increased labour market participation has long been a driver of economic growth in New Zealand. However, women have different experiences in the labour market to men, which can put women at an economic disadvantage.
Common trends we see with women and the labour market are:
- Women are more likely to be underemployed and underutilised in the labour market.
- Women are concentrated in lower skilled, lower paid and/or part-time or casual work.
- Women earn less despite often having more qualifications than men.
- Women are more likely than men to have experienced discrimination, harassment, or bullying at work.
- Women undertake a disproportionate share of caring and family responsibilities, which can reduce their capacity to adapt to labour market requirements and changes.
The quarterly Household Labour Force Survey (HLFS) monitors key indicators of women’s patterns of employment, such as the labour force participation rate (i.e., the proportion of working age (15 years and above) women who are in the labour force) and the unemployment rate.
As at June 2023 in Aotearoa New Zealand, 65.4% of women 15 years and above are employed, compared to 74.4% of men 15 years and above. Women’s participation in the labour force has increased to 67.7%, the highest participation rate since 1986. The labour force participation rate for wāhine Māori (the rate of working aged wāhine who are either in work or looking for work) is slightly lower at 65.7%.
The HLFS includes a measure of the underutilisation of labour in Aotearoa New Zealand. This measure provides an indication of people who are employed but want to work more hours (underemployed), those who want a job but are not currently actively looking or available to start work, and people who are unemployed by the official definition.
308,000 people were reported as underutilised in the June 2023 quarter, which equates to an underutilisation rate of 9.0%. The measure is important because it provides a way to better understand the untapped potential in the labour market.
As at March 2023:
- the underutilisation rate for women was 10.9%, compared with 7.3% for men.
- 160,000 women were underutilised, compared to 118,000 men.
- twice as many women as men were underemployed (61,000 women compared to 30,000 men).
Women undertake most of the unpaid work, particularly caring for children, older people, and those with disabilities, often while managing their paid work commitments.
The Westpac New Zealand 2021 report, Sharing the Load, found that the division of labour remains gendered in New Zealand households as fathers typically do most of the paid work, while mothers undertake the bulk of the work at home. This report found that if the load of housework and care responsibilities was shared more equally, the size of New Zealand’s economy could increase by $1.5 billion on average every year, representing approximately 0.5 percent of New Zealand GDP.
Although unpaid work makes an important contribution to the economy and plays a pivotal role in society and to individuals and communities, it is not visible, widely understood, or recognised, as “real” work.
Where women shoulder most of the responsibility for unpaid care work, they are less likely to be engaged in paid employment. Those who are active in the labour market are more likely to be limited to part-time or informal employment and earn less than their male peers.
The Ministry’s research, Parenthood and Labour Market Outcomes, shows that mothers in paid work suffer a "motherhood penalty" that increases the longer they stay out of the workforce, and mothers who were in low or no-paid work before becoming parents face an ‘employment gap’.
As a result of the motherhood penalty, women are disadvantaged in areas such as pay, progression and security of employment. Women often experience decreased earnings when they return to the paid workforce from career breaks and have difficulty getting their careers back on track or getting into sustainable employment. All of this has a significant impact on women’s lifetime earnings, financial security, and their capacity for retirement savings, which are substantially reduced in comparison to men.
Supporting women into work
There are a range of supports and subsidies that parents could be eligible for that can help with balancing their work and caring responsibilities on the Work and Income website.
Flexible work is any variation from the norm in a worker’s hours, days, or location of work. It can be a formal or informal arrangement with an employer. It can be a key enabler of women’s labour force participation. Flexible work can help men and women to remain in the labour market and can facilitate shared care for children or other dependents.
Flexible work can offer more opportunities for employees and employers and can help to attract and retain skilled labour. Flexible work is commonly seen as a business retention tool and one which, if used strategically, can also improve the productivity and profitability of a business.
Paid parental leave
Paid parental leave is one of the key supports for women in the workforce to be supported while caring for their children and ensure their role is available when they return. Parents are entitled to 26 weeks of government-funded parental leave payments if they will be the 'primary carer' of a child born (or coming into their care), and 52 weeks of unpaid parental leave.
Manatū Wāhine-sponsored research used the Growing Up in New Zealand (GUiNZ) study to report on mothers’ difficulty in accessing childcare. Amongst the findings of the reports, it was identified that:
- Access issues were experienced by 7.7% of mothers nine months after birth, and by 7.5% of mothers two years after birth.
- Mothers reported a range of different access issues, but cost was cited as a major factor, particularly by Pacific mothers.
- Māori and Pacific mothers are two to three times more likely to experience access issues than European mothers, and three to four times as likely to face long term access issues.
- Mothers whose work history was impacted by childcare access issues had more difficulty securing higher-skilled work later.
Access to childcare services can also enable more women to participate in the labour market. Childcare services can include out of school care (OSCAR) and early childhood education (ECE). ECE is important both for children’s education outcomes and as an enabler of their carers’ participation in work.