Millennial women are participating in the American job market at levels last seen in 2000 as people like Remya Ravindran dive back into the labor pool.
Ravindran landed a job at Quizlet, a San Francisco-based technology company, in late 2018 after taking two years off to care for her baby. The 29-year-old software quality-assurance engineer says she wanted to become the household’s second breadwinner and use her education in a labor market she describes as “very, very hot.”
Her case is far from unique. The share of 25- to 34-year-old women who are employed or looking has staged a sharp turnaround since 2016. The group since December 2015 has accounted for 86 percent of growth in the workforce of prime-working-age women, who are 25- to 54-years-old, and for 46 percent of gains in the prime-age labor pool as a whole.
That’s good news for the U.S. economy, as an injection of workers gives overall production more room to run. The phenomenon is also positive for newly-employed women, because they may be laying the groundwork for higher wages as their careers progress. But it creates a puzzling contrast with young men: that group has posted a comparatively weak labor-market rebound. Their participation rate -- though still higher than their female counterparts -- has failed to recover to pre-recession levels.
The gap between young women who are working or looking and their male peers has narrowed to 12.3 percentage points. That’s down from 16.7 points 20 years ago, and it’s the lowest gender divide the age group has ever seen.
Cultural shifts are probably at play. Millennial women are now more likely to have a college degree than their male peers, and employment rates climb with education. The age group has also been delaying weddings and kids. That should boost employment for women, who often drop out of work after marriage, even as married men tend to work more.
Men without college diplomas have been struggling to find lucrative jobs, which could itself keep women at work as they choose to supplement household income. And single-mother households have been on the rise, leaving more young women supporting families.
In fact, single mothers have staged by far the biggest comeback in the labor force of any group of young women since 2016, based on an analysis by Ernie Tedeschi at Evercore ISI. Married women without kids come in second.
Still, none of those trends fully explain why female participation started taking a clear step higher three years ago.
It could be that an uptick in wage growth has tipped the scale: it may be easier for mothers to afford childcare as jobs pay more. And it almost certainly helps that industries doing the most hiring -- led by education and health services -- include many job titles dominated by women.