Why Has the Female Unemployment Rate Fallen So Much in Britain?

Abstract

A decrease in female unemployment wholly accounts for the fall in total U.K. unemployment between its 1984 and 1993 peaks. This fall is associated with a fall in the female inflow rate, is concentrated among women with young children, and is equally evident for all skill groups. These trends cannot be explained by cyclical factors, rather, it is argued that improvements in the provision of workplace childcare have made it easier for mothers with young children to return to work. This reduction in labor market frictions could mean that the natural rate of unemployment has fallen.