While it is true men are affected more than women during recessions, this recession is nothing out of the ordinary
St. Louis (Vocus) October 3, 2009
A new St. Louis Fed research report released today debunks the popular notion that the current recession is predominantly a "man-cession"—a recession hurting American males proportionately more than women and other demographic groups.
The "man-cession" catchphrase is misleading and fails to reveal the full consequences of the recession across different demographic groups, according to author Howard J. Wall, a St. Louis Fed vice president and economist.
"While it is true men are affected more than women during recessions, this recession is nothing out of the ordinary," Wall said. "By some measures, the difference between men and women is smaller than in past recessions."
Indeed, Wall's research showed American men are not suffering more relative to women in this particular recession than in past recessions; their current 78 percent rate of job loss is the same as it was during the 2001 recession. In addition, when foregone employment and an expanded timeframe are included in the analysis, the current recession is actually hurting other demographics groups—women, African Americans, the less educated and the young—proportionally more than men.
"Simply looking at recession in terms of gender and unemployment does not reveal the full impact of the current recession," Wall said. "In order to understand the true effect of recessions on employment across demographic groups, it is necessary to go beyond traditional employment figures and consider foregone employment and an expanded timeframe."
Foregone employment is one key factor not usually included as part of a typical analysis of employment numbers, but it is critical for seeing the full picture, Wall said.
"Foregone employment is lost opportunity—it is the increase in employment that would have existed had the recession not hit," Wall said.
His foregone employment estimates are derived from the Bureau of Labor Statistics’ household survey report and are based on the average employment growth for different demographic groups.
"A recession is not just people losing jobs – it's people who would have had jobs and don't get them," Wall explained. "While male employment has fallen at a very quick rate, their foregone employment is much smaller than it is for women."
After including foregone employment, analysis of this data shows women and African Americans have been hit the hardest by the recession, as have the least educated and the young.
Timeframe is another key factor for seeing a clear picture of the effects of the recession. Because labor markets can weaken before a recession officially begins and remain weak after it ends, the full effects of a recession on employment can't be seen when we limit our examination to the exact timing of an official recession. In the case of the current recession, labor market weakening actually began several months before the official start of the recession in the fourth quarter of 2007. Expanding the timeframe to include these additional months also contributes to a much clearer picture of the effects on employment, he said.
Some surprises Wall found as part of his analysis of the current recession across all demographics include:
- the 55 and up demographic has actually experienced positive employment growth during the current recession, due somewhat to this group delaying retirement;
- married people have experienced much lower employment losses than single people;
- African-Americans have been affected the most by direct employment loss, followed by other non-white demographic groups that have been affected the most by foregone employment; and
- education has a much greater effect on total employment than does gender.
"There are far more interesting demographic differences in this recession than just men versus women," Wall said. "A better understanding of the total effects of recessions across a range of demographic groups will help us manage the effects of the current recession and be better prepared for future ones."
Wall's report, "The Effects of Recession across Demographic Groups," is available on the St. Louis Fed's web site at http://www.stlouisfed.org/publications/RecessionDemographics/. Wall also delves deeper into the research in the October edition of The Regional Economist, the St. Louis Fed’s quarterly journal of business and economic issues. The Regional Economist is available at http://www.stlouisfed.org/publications/re/.
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