Women in the labor market could exacerbate skills shortages in the long term

_ Jurij Kofner, Economist, MIWI Institute for Market Integration and Economic Policy. Munich, April 11, 2024, first published on the Austrian portal Heimatkurier.

Women’s freedom to choose between a job and a career or children and family, or a combination of both, is an important social achievement. Accordingly, women should naturally have the same rights and opportunities as men in the labor market. In the postmodern West, however, we see the reversal of these liberal principles towards the promotion of female labor force participation as the only role model deemed successful, accompanied by an ever-increasing financial necessity for women to work. The mainstream push to force more and more women into the labor market under the guise of “progressiveness” and “emancipation” is not only an attack on the traditional family and the birth rate, but will also exacerbate the skills shortage in the long term from a purely economic perspective.


Political interest groups and research institutes are pushing for greater participation of women in the labor market. They justify this not only by alleviating the shortage of skilled workers and increasing economic growth, but also see it as a step towards emancipation and “progress.”[1] In fact, bringing female labor force participation in line with that of men would bring 1.3 million (Germans without a migration background) to 2.4 million (total population) more women into the labor market.

On the contrary, conservatives view this critically – as an attack on traditional family values – and fear that it will accelerate the population decline. The conservative argument is that increased female labor force participation (FLFP), ceteris paribus, reduces the likelihood that a woman will have children, thereby lowering a country’s total fertility rate (TFR). Thus, while measures to increase female labor force participation help to alleviate the current skills shortage, they could actually exacerbate it after 15-20 years, when the children who are not born as a result have reached working age.

Empirical studies on this topic are very interesting. The following trends were identified for the OECD countries:[2] Initially, the correlation between FLFP and TFR was indeed strongly negative. In the 1980s, however, this relationship turned positive. Between 2005 and 2021, the fertility rate of German citizens rose from 1.3 to 1.5, although the labor force participation rate of German women without a migration background increased from 70 to 81 percent over the same period.[3]

Researchers explain this both with more accommodating social attitudes towards working mothers and with increased political efforts to reconcile work and family life, e.g. with the help of child benefit and better childcare[4].

However, there are two major caveats: The shift towards a positive correlation between FLFP and TFR generally only occurred after the TFR had fallen below the necessary replacement rate of 2.1. And this is still lower in the countries studied. This means that the population of developed countries is still shrinking, as is their respective labor forces. Moreover, as far as the author can tell, previous studies have not taken into account the impact of immigration from cultures with traditionally higher fertility rates on the relationship under discussion. For example, the federal statistics do not differentiate between Germans with and without a migration background in the TFR, but only between citizens and foreigners as a whole.

Until these two questions have been better researched, the German government, especially in the case of a possible conservative coalition, should not prematurely choose increasing female employment as a possible approach to solving the shortage of skilled workers.


[1] Siehe, z.B.: Merkur (2023). Familienministerin: Frauen als Lösung für Fachkräftemangel. URL: https://www.merkur.de/wirtschaft/familienministerin-frauen-als-loesung-fuer-fachkraeftemangel-zr-91857350.html

[2] Oshio T. (2019) Is a positive association between female employment and fertility still spurious in developed countries?  Hitotsubashi University. URL: https://www.demographic-research.org/volumes/vol41/45/default.htm

[3] Destatis (2023b). Ergebnisse des Mikrozensus. Statistische Bibliothek. URL: https://www.statistischebibliothek.de/mir/receive/DESerie_mods_00000020 |

[4] Destatis (2023c). Zusammengefasste Geburtenziffern (je Frau): Deutschland, Jahre, Staatsangehörigkeit der Mutter. URL: https://bit.ly/3TPbDu6

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