Europa Regina: The Effect of World War II on European Female Labor

Transcription

1 University of Colorado, Boulder CU Scholar Undergraduate Honors Theses Honors Program Spring 2017 Europa Regina: The Effect of World War II on European Female Labor Helen Harris Follow this and additional works at: Part of the Economic History Commons, and the Labor Economics Commons Recommended Citation Harris, Helen, "Europa Regina: The Effect of World War II on European Female Labor" (2017). Undergraduate Honors Theses This Thesis is brought to you for free and open access by Honors Program at CU Scholar. It has been accepted for inclusion in Undergraduate Honors Theses by an authorized administrator of CU Scholar. For more information, please contact

2 Europa Regina: The Effect of World War II on European Female Labor Helen Harris Advisor: Carol Shiue, Economics Honors Council Representative: Martin Boileau, Economics Committee Member: Lorraine Bayard de Volo, Women and Gender Studies April 7 th, 2017 Previous research suggests that WWII induced a lasting increase in American female labor force participation. This paper explores if WWII influenced European female labor force participation in a similar way from 1940 to The analysis regresses changes in female labor force participation after the war, on changes in military mobilization rates for 17 European countries. The results show that the European female labor force participation growth rate decreased during the decade and increased from While these results are statistically significant and female specific, they are relatively small in magnitude. Within these changes were sectoral changes, primarily a decrease in white-collar growth for both time frames. The mechanisms for these changes most likely stem from a post-war baby boom and an increase in national education levels.

3 1. Introduction World War II caused political upheaval, transformations in foreign policy, and economic disruption for countries across the world. A less noticeable, but still important, change that the war sparked was a long-term increase in female labor force participation in the United States (Goldin and Olivetti, 2013). Goldin and others argue that the massive military personnel mobilization during the war created vacuums in the male dominated work force, which were filled by women. While the long-term impact varied depending on women s socio-economic level, familial status, and education, this experience of drastic mobilization changes may have had a hand in transforming the American female labor supply into what is seen today (Goldin and Olivetti, 2013). Research about the war and female labor has predominantly focused on the United States. Arguably though, the United States had a unique war experience due to the high level of involvement, yet low levels of physical damage that it sustained. In contrast, many countries in Europe also faced large amounts of civilian casualties, obliteration of infrastructure, and economic crises in addition to the changes in mobilization rates. To quantitatively investigate the European war experience and compare it to that of the United States, this analysis examines how different experiences across countries during WWII affected short- and long-term changes in female labor force participation. This paper regresses the short- and long-term percent changes in female labor force participation on percent changes in national mobilization rates, while controlling for pre-war levels of education, marriage, and birth rates. To explain any variations in female labor force participation, alterations in sectoral participation and their relationships to changes in mobilization

4 rates are also examined. The same analysis is then applied to male labor force participation to explore possible macroeconomic fluctuations that existed and would have affected the labor force in total. The analysis aims to determine if there was a war-induced change, which sectors were driving forces, and if this change was female specific. 2. Literature Review Recent research on WWII and European female labor can be divided into two categories: the influence of WWII and general motivators. The first of these focuses specifically on effects of WWII on female labor force participation. The second has a more general scope and explores the different general motivators of female labor. 2.1 Relationship of WWII and Female Labor Force Participation: This section of literature covers several of the general motivators, however one common feature is that the research focuses on changes in the American labor force. While Olivetti (2013) executes an analysis involving multiple countries with a time frame that saddles WWII, the specific conflict caused effects are analyzed with a focus on the American labor force. Acemoglu, Autor, and Lyle (2004) use mobilization rates during the war to examine women entering the labor force and the effect that this had on wages for both men and women. Similarly, Jaworski (2014) examines the war s negative impact on female education which in turn lowered women s wages in the short-run. Goldin and Olivetti (2013) published the research most similar to this paper. They also use the methodology of mobilization rates to reassess one of Goldin s previous studies (Goldin 1991), which looked at the long-term impact of the war on American female labor force participation rates. This reassessment contradicts the original work s conclusion, and finds that instead of the

5 war having weak effects, as previously thought, it did alter the female labor supply. Furthermore, they compare their results to the revisionist and watershed theories outlined previously in Goldin s other work (Goldin 1991). The watershed theory is the idea that the war caused significant changes in the ideological structure of the US, and because of this, the women who entered the workforce during the war remained in the work force later on. The revisionist theory contradicts this argument by noting the many women who were pushed out of the work force in the long-run because of gender norms. Goldin and Olivetti s conclusion combines the two theories and supports the hypothesis that women with higher education experienced the watershed theory, while less educated women experienced the revisionist situation. More specifically, the authors find that higher mobilization rates impacted women with higher education, and that the short-term effects (1950) were felt primarily by married women without children during the war. In the long-run (1960), however, the war also impacted married women with children during the war. 2.2 General Motivators of Female Labor Force Participation: Of the many incentives highlighted by researchers, theorists, and authors, the most prevalent influence on women s labor decision is societal norms. Dao (2014) focuses on the impact of social norms pertaining to parenthood and housewives. Göksel (2013) also explores the role of norms but chooses instead to examine the role of conservatism and religion. While her research pertains to Turkey and traditional Islam, it would be possible to argue that the negative effects of conservative norms on female labor force participation that Göksel (2013) finds are influential to varying degrees in other societies too. The role of Islam and non-secular rule is further explored by Mehmood, Ahmad, and Imran (2015), but their findings, while including some norms, focus

6 primarily on factors such as the cost of living, education, and women s support systems, and finds that these other factors outweigh the effects of conservatism. The idea of norms is measured in various ways in the different analyses. Göksel (2013) creates dummy variables to represent conservatism which are based on survey questions about the role of religion, while Mehmood, Ahmad, and Imran (2015) calculate their female empowerment variable as equivalent to the prevalence of contraceptives. Education is the second most noted factor in an abundance of papers. Shah (1990), Mehmood, Ahmad, and Imran (2015), and Goldin (2006) all examine the role of education and find almost unanimously that as women s education becomes more prominent in a society, women start to face higher opportunity costs for not working, so labor force participation increases. Several other cultural and political factors are outlined in various pieces such as government policy relating to child care subsidies or tax breaks, as outlined by the OECD Economics Department (2004). Continuing on the more national scale, Moghadam (1990) argues that a country s economic status as a whole is relevant for female labor, and Olivetti (2013) expands on this idea, concluding that there is a U-shaped relationship between the two. Part of the economic status that Fernandez, Olivetti, and Fogli (2004) point to is a growth in the service sector, and a corresponding increase in availability of part-time positions. They also examine factors which act on the more individual level, including the availability of reliable birth control, domestic appliances decreasing the domestic workload, and familial norms. An interesting familial norm examined by both Fernandez, Olivetti, and Fogli (2004) and Morrill and Morrill (2013), is the relationship between women working and their mother s and mother-in-law s participation in the labor force. The two pieces together argue that while women are influenced by their own mothers, they are more influenced by their mother-in-law due to marriage preferences that men develop

7 through their family norms. This type of individual level analysis can be very specific, and has a broad range. For example, Slakever (1990) finds a stronger negative impact of a disabled child on labor supply and earnings for mothers than for fathers. 2.3 Non-Economic Literature: Outside of the strictly economic scope, the relationship between war and women is well developed in qualitative analysis. This relationship can be examined through both historic and women s studies lenses, with each area highlighting different aspects. Women s studies researchers have emphasized the effects of war such as increased violence towards women through war time violence, such as rape, and domestic violence or stress induced incidents such as those caused by PTSD. Another aspect highlighted by this area is the push for gender equality leading to equality in the armed forces, which could normalize the effects of war between men and women, since both are affected in a more similar, direct manner (Bayard de Volo, 2016). Similar to the economic literature, there is a strand of historical literature which explores the changing of norms of women s role in society and the household. A prevalent point of view is that war causes a disruption of norms, so after war societies try to return to normality, or the norms which were accepted before the war (Kent, 2016). Again similar to economic literature, research in the other fields emphasizes increases in education as a means to increase female labor force participation and equality in general. 3. Data The data used for analyzing the effect of changes in mobilization rates on changes in female labor force participation for European countries involved in WWII comes from two different sources.

8 3.1 Demographic and Labor Data The first is the International Historical Statistics, which provides macro-level data for every European country through compiling various primary sources. The data includes specifics concerning population levels by gender and age cohorts, sectoral employment levels by gender, marriages, births, and education. Because the majority of the data is from censuses, each observation is a specific year in a specific country with, on average, a ten-year gap between observations for one country. The observations range for 101 years, between 1900 and 2001, and include 17 European countries which were involved in WWII 1. For this specific analysis, the sectoral employment levels for each year-country combination were aggregated to generate the total female working population, which was then divided by the corresponding total working aged (between 15 and 64 years old) female population. This creates the female labor force participation rate for each country-year combination 2. Comparing the average participation rate from before WWII to after shows the anticipated increase in average female labor force participation. As Table 1.1 shows, across Europe the participation rate grew slightly from 48.36% to 51.19%. Focusing in to more country level analysis, each country s female labor force participation is turned into a short- and long-term percent change to 1 The examined countries are: Austria, Belgium, Bulgaria, Czechoslovakia, Denmark, Finland, France, Greece, Hungary, Italy, the Netherlands, Norway, Poland, Romania, Russia/USSR, the United Kingdom, and Yugoslavia. While Germany was one of the biggest participants, it is excluded due to the complexities surrounding its post-war division. 2 This data may contain measurement inaccuracies rooted in the surveys and question wording which is the most common tool of measurement; Anker (1990) explores possible measurement errors which are frequent when measuring female labor force participation.

9 capture each country s specific situation 3. The changes in female labor force participation are constructed as the percent changes from 1940 to 1950 (short-run), or 1940 to 1960 (long-run) 4. The other variables included in this data set have been shown by previous research to be influential in women s labor choices. Of the previously mentioned variables, for this analysis education, birth rates, and marriage rates are considered to be not only directly influential, but also representative of norms. These three variables are reflective of women s expected role in society, where a more domestic role emphasizes marriage and child bearing, and less domestic focuses instead on education and independence. Corresponding to this hypothesis, the data in Table 1.1 shows that both marriages and births decreased: the pre-1945 marriages per 1000 mean decreased from to and the pre-1945 births per 1000 mean dropped significantly from to Education also shows the expected increase from a pre-1945 university attendance rate of 1.9% to 15.1% Mobilization Data The data pertaining to mobilization and military personnel comes from the Correlates of War Project, which has data of total population and military personnel population for each country for almost every year. The mobilization rate used in this analysis is defined as the total number of military personnel over the total population 6 for each country-year combination defined by the 3 The temporal division is created to allow for analysis with regards to the watershed and revisionist theories, which each focus on short- and long-term effects. 4 Russia is excluded from the percent change due to a lack of data. Since every country took its census at different years, the 1940 labor participation rate is the nearest pre-1941 year available for each country. The 1950 and 1960 observations are actually a range of five years before to four years after the target year. For countries with multiple years in each range, the year closest to the target year is chosen. 5 Education is measured as the percent of individuals who attend university out of the total population. This data is an aggregate of males and females, so it is used to represent societal education and to attempt to control for social norms. The more recent data for some countries is inaccurate, stemming from either the population or university population numbers. 6 The population used is the number from the Correlates of War Project and not the International Historical Statistics, while female labor force participation uses the total population from the International Historical Statistics.

10 female labor force participation. To examine the changes in mobilization caused by WWII, a variable of the percent change in military personnel is created. This variable shows the change between the pre-1940 average of military personnel since 1900, and the peak level of mobilization during the war for each country. 4. Methodology The percent change in female labor force participation is regressed on the percent change in mobilization rate while controlling for several demographic differences. The equation for this is: Y x,t = β 1 M x + β 2 C x + ε where Yx,t is the outcome of the change in the growth rate of female labor force participation for country x from 1940 to year t, where t equals either 1950 or β1mx is constructed as the percent change in mobilization rates from a pre-1940 average to a war time peak for country x. Mobilization rates are measured as the percent of a population which was military personnel. The pre-1940 average is a country specific average of all available observations between 1900 and The peak rate used extracts the highest, country specific mobilization rate that was experienced between 1940 and The coefficient β1 is the most important for this analysis as it reflects the specific effect of changes in mobilization rates on female labor force participation changes. Since mobilization rates are being used as a proxy for a country s experience during WWII, more generally this coefficient represents how WWII itself impacted female labor force participation. To control for cross-country differences, β2cx reflects a vector of country specific control variables. This includes the average

11 pre-1940 levels of education, birthrates, and marriages for country x. The levels are constructed as country specific averages of all available observations for each respective control between 1900 and Due to possible reverse causality between the control variables and labor force participation, the analysis is working under the assumption that these variables have a stronger effect than the inverse. As Claudia and Olivetti point out in their research, mobilization must be independent of female labor and using the same technique, it is shown (Table ) that pre-1940 female labor force participation rates are independent of the war induced changes in mobilization rates. 5. Results The analysis of the data starts at the continent level and gradually focus in to sectoral specific data. For the macro-scale, Figure 1.1 shows each data point of female labor force participation over time for Europe. The data shows a general upward trend since 1900, however there are no clear, sudden changes between 1940 and Splitting the trend line at 1945 (Figure 1.2), however, does show a small decrease in the continent-wide participation rate around 1945 and a steeper slope after the war. Because the pre-1945 trend line is almost completely flat, the change of slope post-1945 leads one to believe on a very preliminary basis that the war had a longrun positive impact on female labor force participation. 7 The categories of mobilization rates are derived from breaking mobilization rate changes into thirds with the upper third being high and the bottom third being low mobilization rates.

12 5.1 Macro Changes in Female Labor Force Participation Examining the relationship between mobilization rate changes and labor force changes allows for more specific analysis of the possible changes around Starting with the relationship between the percent change in mobilization rates and the short-run percent change in female labor force participation, Figure 2.1 shows a negative slope. Regressing the two produces a statistically significant negative coefficient on mobilization rates, as seen in Table 2.1 9, where the β1 coefficient is relatively indifferent to the vector of country specific effects, remaining between -1.2 and -2 percentage points. In the short-run, a 100 percentage point increase in a country s mobilization rate during the war produced a decrease of 1.6 percentage points in the respective female labor force participation rate growth between 1940 and Given an average mobilization increase of 276%, this would equate to a 4.42 (=2.76*-1.6) percentage point decrease in the average female labor force participation growth, reducing it from the pre-war average growth rate of 2.71% to -1.71% 10. Figure 2.2 graphically shows the long-run percent change in female labor force participation which appears to increase with mobilization rates. Table 2.2 shows the long-run regression which produces a statistically significant positive coefficient. Similar to the short-run, this coefficient remains fairly stable regardless of the controls. In the long run, the β1 coefficient shows a 1.6 percentage point increase in the growth of female labor force participation between 1940 and 1960 for a 100 percentage point increase in a country s mobilization growth rate. A 1.6 percentage point increase would result in an average projected increase in the growth of female 8 As shown by Figures 2.1 and 2.2, country GDP is unrelated to changes in mobilization or changes in female labor force participation. 9 A clear outlier which might bias the trend line is Yugoslavia, which experienced an abnormally large increase in female labor with low mobilization rate changes. 10 The true average growth of female labor force participation in the short-run was -0.51%

13 labor by 4.42 (=2.76*1.6) percentage points, resulting in a projected change of 7.31% between 1940 and Sectoral Changes in Female Labor Force Participation Sectoral analysis is used to further examine reasons for a short-run decline and long-run increase in female labor force participation. The labor force is divided into four sectors: bluecollar, white-collar, agricultural, and service and other. Examining the relationship between mobilization rate changes and female labor force participation changes shows which sectors are the driving forces behind the more macro level changes previously examined. Between 1940 and 1950, white-collar job growth decreased while service jobs increased as mobilization increased (Table 3.1). The β1 coefficient for white-collar jobs shows a decrease in the growth by 12.1 percentage points for a 100 percentage point increase in mobilization, which is relatively large given a total decline of 1.6 percentage points. Moving to the long-run, the driving sector of growth is agriculture, while white-collar jobs continued to shrink (Table 3.2). Again, the white-collar decline is relatively large at 11.5 percentage points. There is also some growth, though insignificant, of the service sector and an insignificant decline in blue-collar jobs which is somewhat supported by Goldin and Olivetti s claims for the American labor force, in which they argued women were pushed out of blue-collar occupations and instead entered service occupations. However, there is also a contrast with Goldin and Olivetti due to the changes in white-collar labor. They discussed that primarily more educated women in white-collar positions experienced the long-term impact of the war, however these results show that white-collar positions declined in growth. 11 The actual average change of long-run female labor force participation was -4.71%.

14 5.3 Macro Changes in Total Labor Force Participation Because the economy as a whole is comprised of many moving parts which were affected during the war, it is necessary to also explore possible trends which would have influenced the whole labor force, not just women. Examining the respective short- and long-run changes in male labor force participation shows any indicators of drastic changes to the economy. This analysis is identical to that of the female labor force participation and its relationship to mobilization, where percent change in mobilization rate is measured using the pre-1940 average to peak level change, and labor force participation is measured as the number of working men out of the total male population between the ages of 15 and The coefficients in Table 4.1 focus on the male trend, and show a decrease in male labor force participation growth by 0.7 percentage points for every 100 percentage point increase in mobilization growth. In the long-run, there is a statistically insignificant relationship of a 0.6 percentage point decrease for every 100 percentage point mobilization increase (Table 4.2). Because there appears to be no strong relationship between mobilization rates and male labor force participation, this reinforces the idea that any labor force changes that were occurring were female specific. If there had been trends similar in the male data to the female data, then that would suggest that countries with higher mobilization rate changes faced other economic changes which influenced labor in total. Infrastructure damage and economic instability would result in an effect across the board, but because the short-run decrease and long-run increase seen in female 12 Several observations have values greater than one for male labor force participation rate. This is most likely due to the age restrictions on the total population. Because the variable of interest is percent change, the greater than one observations are included and left unedited.

15 labor were not consistent with male labor, there was a gender specific mechanism that influenced female labor force participation. Some possible female specific macroeconomic events could be changes in the control variables of births, marriages, and education. Graphically, it appears that country wide level education experienced a sudden increase in growth after the war (Figure 5.3). While the data does not show which gender experienced a larger educational gain, making the assumption that women experienced some gain would affect opportunity costs, and encourage entrance into the labor force. Births and marriages are relevant to female labor, and both appear to increase after the war, creating a possible baby boom situation (Figures 5.1 and 5.2). If there was increase in marriages and families immediately after the war, this could decrease female participation, depending on social norms. Assuming Europeans maintained similar traditional gender roles to those of Americans, then an increase in marriages and births would cause women to leave the work force and enter the domestic domain. This macroeconomic effect would be most prevalent right after the war, and might explain some of the short-run decreases seen in the female participation growth rate. 6. Conclusion Overall, it appears that WWII induced economic changes which had a gender specific influence on female labor force participation. The hypothesis that the effects were female specific is drawn from the small coefficients observed in the male labor regression. Because there appears to be a minimal effect from the war on male labor growth, this shows that the macroeconomic change was not universal, but operated through mechanisms which affected women more than men. These mechanisms could be numerous, but most likely include motherhood.

16 The motherhood aspect of women s lives is in both regressions, though it is most likely more explanative from Looking at births graphically shows a decline in the average European birth rate, however fracturing the trend line at 1945 appears to show a jump in births right after the war. Depending on the magnitude of this jump for each country, this could be a leading factor in the decline in female labor growth which is projected by the regression. If there was a baby boom similar to that of the United States, then women would have exited the labor force to become mothers, producing the projected average -1.71% growth rate in the short-run. The sectoral data analysis shows a significant decline in white-collar labor, which is counter-intuitive since one would think that women in white-collar jobs would have a high opportunity cost for exiting the labor force. Because the regression examines the percent changes in each sector though, it is important to look at the numbers of women in each sector, which shows that the average number of women in white collar sectors was lower than that in the other sectors (Table ). This means that while white collar women may have experienced the biggest change in percentage, a higher number of women may have exited the work force in other sectors. The decline is existent across all sectors, except for the service sector, which encourages the babyboom hypothesis since it would be influential to all child-bearing aged women, regardless of economic class or sector. The baby-boom effect is probably reduced by 1960 because children who were born after the war have grown and would no longer occupy their mothers time. This situation would eliminate the decline of the short-run, but not explain the increase in the long-run. Examining country level education shows an increase in the slope of the educated population over time. While 13 The range was chosen to account for all observations which compose the percent change data. There is less than a one person change in the average for all of the sectors from a range of to a range from

17 the education variable includes males and females, assuming women experienced a portion of the academic gains would mean labor force participation was encouraged by women being more educated and having higher opportunity costs for not working. This hypothesis, however, is contrasted by the sectoral data, since there is a negative coefficient on the white-collar sector. Even though there is a contrast, education should not be ruled out completely because it could influence other social aspects which in-turn influence female labor. European female labor force participation growth decreased right after the war, possibly due to a baby-boom, but increased by This fits with neither the revisionist or watershed theories since both support an initial increase in female labor, but it is consistent with the watershed theory in regards to the lasting impact of the war, though the theory also emphasizes a change in norms which is difficult to analyze with this data. Another important aspect of the watershed view which is missing is the idea of a large and fundamental change caused by the war. It is true that there was a long-run labor force participation growth rate increase of 1.6 percentage points, however this rate required a 276% increase in mobilization rates, in contrast to the 4.6 percentage point increase 14 observed in the United States which required only a 6.8 percentage point increase in mobilization (Goldin and Olivetti, 2013). While the war increased European labor, it was a relatively small increase. It is important to note though, that the American analysis involves much more specific categorization, and the European magnitude could be augmented by similar categorical analysis. The difference in outcomes is reflective of different war experiences. The United States felt the war primarily as increased costs and a sudden decreased labor supply. For the majority of Europe, infrastructure damage, civilian casualties, and uncertainty shadowed the decreased labor 14 This figure only examines married women from ages

18 supply. After the war, Europe faced a long recovery process which included economic stabilization and political restructuring for many countries. These processes would have influenced economic growth, labor demands, and social norms which all could have inhibited women from working more. The American analysis examines a relatively specific change which allows for clear analysis, while European analysis is muddled because of the many simultaneous and drastic changes which were results of the war. This analysis is constrained by the scope, quantity, and accuracy of the available data. Future research would benefit from specific individual level observations to develop a more robust sample, and to allow for more details in the birth, marriage, and education controls. Country specific analysis would also be beneficial, and allow for more discussion surrounding the changes in institutions and political structures which occurred. These country specific, war induced changes would bias the mobilization rate coefficient, such as a positive bias due to changes in cost of living or a negative one caused by infrastructure damage. More in-depth future analysis would be able to more closely examine the war related effects, and more accurately tie mobilization rate changes and female labor force participation together.

19 References 1. Acemoglu, Daron, David Autor H., and David Lyle. "Women, War, and Wages: The Effect of Female Labor Supply on the Wage Structure at Midcentury." Journal of Political Economy (2004): Web. 2. Anker, Richard. Methodological Considerations in Measuring Women s Labor Force Activity in Developing Countries: The Case of Egypt. Research in Human Capital and Development 6 (1990): Print. 3. Bayard de Volo, Lorraine (women s studies professor) in discussion with the author, September, Dao, Minh Quang. Female Labor Force Participation in Developing Countries. Economia Internazionale 67.3 (2014): Web. 5. Göksel, İdil. Female Labor Force Participation in Turkey: The Role of Conservatism. Women's Studies International Forum 41.1 (2013): Web. 6. Goldin, Claudia. The Role of World War II in the Rise of Women's Employment. The American Economic Review 81.4 (1991): Web The Quiet Revolution That Transformed Women s Employment, Education, and Family. American Economic Review 96 (2006): Goldin, Claudia, and Claudia Olivetti. "Shocking Labor Supply: A Reassessment of the Role of World War II on Women s Labor Supply." American Economic Review: Papers & Proceedings (2013): Web. 9. Jaworski, Taylor. You re in the Army Now: The Impact of World War II on Women s Education, Work, and Family. The Journal of Economic History 74.1 (2014): Web. 10. Kent, Susan (history professor) in discussion with the author, October, Mehmood, Bilal; Ahmad, Sama; Imran, Muhammad. What Derives Female Labor Force Participation in Muslim Countries? A Generalized Method of Moments Inference. Pakistan Journal of Commerce and Social Sciences 9.1 (2015): Web. 12. Moghadam, V. M. Determinants of Female Labor Force Participation in the Middle East and North Africa. Working paper no. 85. World Institute for Development Economics Research of the United Nations University, (1990): Web. 13. Morrill, Melinda S. and Thayer Morrill. Intergenerational Links in Female Labor Force Participation. Labour Economics 20 (2013): Web.

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