Today is Canada Day, a good opportunity to compare the U.S. with its neighbor to the north. In many ways, the Canadian and U.S. economies are similar, foremost from the fact that they’re so intertwined. But there are also some stark differences. One difference that’s received a good amount of attention is women in the labor force.
The FRED graph above tracks the labor participation rate of Canadian and American women. In both countries, it has increased since the 1960s, thanks to household technology and emancipation. In 1998, it stalled in the U.S. but it has continued to progress in Canada to this date. The gap between the two countries is now almost 9 percentage points, and it’s back to pre-pandemic levels in Canada while still lagging in the U.S.
What’s going on? We can speculate here about some institutional differences that would impact the willingness and ability of women to work. Canada has several provisions for job-protected parental leave and supporting children in the tax code, as well as substantial child care subsidies in some provinces. U.S. support for working families is more limited.
How this graph was created: Search FRED for “activity rate female” and click on the Canadian series. From the “Edit Graph” panel, use the “Add Line” tab to search for and select the U.S. series. Finally, start the graph on 1995-01-01.
Suggested by Tammy Schirle.