From Trend to Cycle: the changing Careers of Women and Business Cycle Risk

Speaker: Dr Amanda Michaud Senior Economist, Federal Reserve Bank of Saint Louis

Paper abstract: The rise in hours and employment of married women has been driven by a rise of "career women" with highly persistent full-time participation. We derive implications of this secular change for the cyclically aggregate labor using a unified theory where increases in the returns to tenure and decreasing child care costs change women's choice of career paths. We find that, while the cyclicality of hours varies greatly across career types, the changing composition of careers and families increases the cyclicality of aggregate hours and redistributes the cyclical risk across household types. We explore implications for households' welfare, risk sharing, and savings, by cohort and for each recessionary episode over the computed transition from 1975-2015.