Sunday, August 21, 2011

Labor Force Participation Rates-Part Two


Dr. Maya Choshen

Labor force participation rates are calculated as the number of individuals between the ages of 20 and 65 who are actively involved in the labor force as a percentage of the entire working-aged population.  The category of labor force participants includes those who are employed or are actively seeking employment.  Recently, the country has been embroiled in a public and professional debate over the age of retirement for women in Israel, which is currently lower than retirement age for men. This debate is naturally connected to more general differences between men and women which also play out in the work world.  The present column focuses on the gender differences of labor force   participation rates.  As previously noted, labor force participation rates in Jerusalem are lower than the national average (58% compared with 71%), primarily owing to the low participation rates among Jerusalem’s ultra-orthodox men and Arab women.  The labor force  participation rate of the Jewish male population was 59% in Jerusalem compared with 75% in Israel.  Among the Arab male population the situation was reversed: their labor force participation rates were higher in Jerusalem than their national average (78% compared with 75%).  As for women, what can be said?

Women’s labor force participation rates were lower in Jerusalem than in Israel, among both the Jewish and Arab populations.  In 2009, the labor force participation rate for Jewish women was 68% in Jerusalem compared with 75% nationally; for Arab women the rate was 15% in Jerusalem compared with 26%.    

On the other hand, labor force participation rates of Jewish women in Jerusalem outstrip Jewish men (68% versus 59%), which can again be pinned to the low participation rate of ultra-orthodox men.  In Israel, the labor force participation rate of Jewish women was similar to Jewish Men. It is worthwhile to note that the labor force participation rate of Jewish women in Tel Aviv was only slightly lower than the rate for Jewish men (79% compared with 82%), and similarly in Haifa, the comparison was 76% to 78%, respectively.



Sunday, August 7, 2011

Labor Force Participation Rates


Dr. Maya Choshen


Labor force participation rates are calculated as the number of individuals actively involved in the Labor force as a percentage of the entire working-aged population.  The category of Labor force participants includes those who are employed or are actively seeking employment.  While there are a number of different ways to define the Labor force, this column follows the definition of those between the ages of 20 and 65.

The economic effects of Labor force participation rates play out on the individual, family, city and national levels.  Studies performed by the Bank of Israel have found that low Labor force participation rates characterize those who have less education, ultra-orthodox males with an extensive religious education, and Arab women, particularly with less education.  Low participation rates prevent the maximization of the country’s productiveness, lower quality of living, and increase the scope of poverty as well as government spending on welfare entitlements.

A comparison of Labor force participation rates for 2009 (for those aged 20 to 65) in Jerusalem and Israel as a whole reveal significantly lower rates for Jerusalem (58% compared with 71%).  Jerusalemites’ Labor force participation rates lagged far behind national averages for both the Jewish population (includes non-Arab Christians, and persons without religious classification) and Arab population. The average participation rate for Jerusalem among the former group was 64% compared with a national average of 75%; among the latter group it was 47% compared with a national rate of 50%.  It is noteworthy that the disparity between participation rates in Jerusalem and Israel as a whole is greater for the Jewish rather than the Arab population.  This finding might be explained by the distinct character of Jerusalem’s Jewish population which is greatly ultra-orthodox, a group with strikingly low employment rates among its male population. This reality impacts Jerusalem’s economy as well as the pervasiveness of poverty among the ultra-orthodox population.  On the upside, the current situation offers tremendous potential for economic growth, and there are many national and municipal programs aiming to incorporate more ultra-orthodox men in institutions of higher education for the purpose of helping them incorporate in the Labor force.  The upcoming column will deal with Labor force participation rates among the Arab population and gender differences.