Employment, Education and Childbearing Decisions in Norway, 1993-2016

Lars Dommermuth, Research Dep., Statistics Norway
Trude Lappegard, University of Oslo
Tom Kornstad, Research Dep., Statistics Norway

In this paper, we revisit the relationship between female employment and childbearing, focusing on Norway. There are several arguments for the relevance of revisiting the relationship between female employment and childbearing. First, decisions about employment and fertility is embedded in the social policy context and over the last decades, generous arrangements have improved substantially in Norway. This may indicate reduced opportunity cost of having children for most Norwegian women and thus less fertility differences between employed and not employed women. Second, the meaning of education has changed because more women taking higher education. This raises the question about whether the relationship between employment and childbearing has changed for different educational groups. Third, a high proportion of Norwegian women work part-time, but a downward trend is emerging. That fewer women choose part-time work is most likely because of the increasing trend in women with higher education. Scholars argue that high level of female part-time work is a prerequisite for the relatively high fertility in Norway. This raises the question about whether relatively high fertility is sustainable with increasing female full-time employment. Applying data covering all women living in Norway 1992-2016, we investigate the effect of (current) employment status of women on their childbearing over time, and whether this effect have changed among women with different educational attainment. To account for the possibility that the birth- and the employment process might be jointly determined, and the possible selection issues arising from this, we employ a simultaneous equations approach for hazard models. In addition, we use the estimated model for simulation experiments focusing on the interrelationship between employment, childbearing and education. That is, we can quantify how much of the decreasing fertility level that is a result of increased female educational attainment.

In this paper, we revisit the relationship between female employment and childbearing. The aim is to investigate the relationship between women’s employment and childbearing, and we are especially interested in whether the relationship has changed for different educational groups over time. Ever since female employment started to increase, the relationship between women’s employment and fertility behavior has been of high interest. At first, increasing female employment was associated with lower fertility, often explained by increasing opportunity costs for women and an increasing gap between female contribution to family economy on the one side and male contribution to domestic duties on the other side. Especially women with higher education had the highest opportunity costs and thus the lowest fertility. Later, the relationship changed at macro level and countries with highest female employment rates reported higher fertility. That is, countries lowering the opportunity cost for women in the labor market through social policies and thus facilitating more compatibility between female employment and childrearing. At the individual level, there is still a mixed relationship between women’s employment and fertility.

In this paper, we focus on Norway, a country following a dual strategy for women choosing both work and childbearing. There are several arguments for the relevance of revisiting the relationship between female employment and childbearing. First, women’s decisions about employment and fertility is embedded in the social policy context and over the last three decades, generous arrangements such as paid parental leave and subsidized day-care have improved substantially in Norway. This may indicate reduced opportunity cost of having children for most Norwegian women and thus less fertility differences between employed and not employed women. Second, the meaning of education has changed because more women taking higher education, and while women with higher education have become a less selective group, women with lower education have become a more selective group. This raises the question about whether the relationship between employment and childbearing has changed for different educational groups. Third, a high proportion of Norwegian women work part-time, but a downward trend is emerging. That fewer women choose part-time work is most likely because of the increasing trend in women with higher education and jobs that requires higher education are more difficult to combine with part-time work. Scholars argue that high level of female part-time work is a prerequisite for the relatively high fertility in Norway (Rønsen and Skrede 2010). This raises the question about whether relatively high fertility in Norway is sustainable with increasing proportions of full-time employed women.

We examine the relationship between employment and childbearing for Norwegian women during the period 1993-2016. Female educational attainment has increased during this period and increased the probability of full-time work among women. The main interest will be on the effect of (current) employment status of women on their childbearing over time. Of special interest is whether this effect have changed among women with different educational attainment. To account for the possibility that the birth process and the employment process might be jointly determined and the possible selection issues arising from this we employ a simultaneous equations approach for hazard models.

The data cover all women living in Norway during the period 1992-2016. Information from Norwegian administrative registers gives us complete fertility and employment histories for all women, while information about background variables such as educational achievement arise from additional administrative registries. This allows us to observe if and eventually when women give birth to a child and to identify whether the women works or not. From this can follow the women over time – from quarter to quarter - and observe their transitions to first, second, third and fourth birth and their prior employment.

We will estimate a simultaneous hazard model for births and employment, taking into account the possible selection problems that might arise due to unobserved characteristics influencing the women’s childbearing and employment decisions. By estimating a simultaneous hazard model, we consider that employment might influence the birth process and vice versa. An expectation for the hazard for full-time work is to find a positive effect of higher education, while for the hazard for birth a negative effect of higher education. When accounting for the simultaneous adjustments about births and employment, higher education might explain the downward fertility trend via effects in the labor market.

We use the estimated model for simulation experiments where we focus on the interrelationship between employment, childbearing and educational attainment. That is, we can estimate the total number of births for women in different employment groups and with different educational achievement. In addition, we can investigate the contribution of women working full-time to the total fertility rate, and see how this differs over time for different groups. We can also quantify how much of the decreasing fertility level that is a result of increased educational level among women.

Presented in Session 1137: Fertility