Abstract
Cross-country differences in both the age at first birth and fertility are substantial in Europe. This paper uses distinct fluctuations in unemployment rates across European countries during the 1980s and the 1990s combined with broad differences in their labor market arrangements to analyze the associations between fertility timing and the changing economic environment with close to 50,000 women from 13 European countries. First, it employs time-varying measures of aggregate market conditions in each woman’s country as covariates and second, it adds micro-measures of each woman’s labor market history to the models. High and persistent unemployment in a country is associated with delays in childbearing (and second births). The association is robust to diverse measures of unemployment and to controls for family-friendly policies. Besides moderate unemployment, a large public employment sector (which provides security and benefits) is coupled with faster transitions to all births. Women with temporary contracts, mostly in Southern Europe, are the least likely to give birth to a second child.
Résumé
En Europe, les différences entre pays tant pour l’âge à la première naissance que pour la fécondité sont importantes. Dans cet article, les données sur les fluctuations des taux de chômage dans les pays européens durant les années 1980 et les années 1990 ainsi que sur les grandes différences dans les caractéristiques du marché du travail sont utilisées afin d’analyser les associations entre calendrier de fécondité et l’environnement économique variable, pour près de 50.000 femmes dans treize pays européens. Dans un premier temps, des mesures agrégées et variant avec le temps du marché économique du pays de chacune des femmes sont utilisées comme covariables ; dans un deuxième temps, des caractéristiques relatives à l’histoire de chaque femme sur le marché du travail sont ajoutées au modèle. Dans les pays présentant un chômage élevé et persistant, la fécondité (et les secondes naissances) est postposée. Cette association persiste en dépit de diverses mesures prises pour enrayer le chômage et malgré le contrôle de l’existence de politiques en faveur de la famille. Un chômage modéré et une proportion élevée d’emploi dans le secteur public (garantie de sécurité et d’avantages) sont associés à une procréation plus rapide. Les femmes ayant des contrats d’emploi temporaires, principalement en Europe du Sud, ont les plus faibles probabilités de donner naissance à un deuxième enfant.
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Notes
Gauthier (2007) provides a good review of this literature.
The total fertility rate (TFR) is an age-period fertility rate for a synthetic cohort of women. It measures the average number of children a group of women would bear by the end of their lifetime if they were to give birth at the current age-specific fertility rates.
The purchase of childcare services in the market may lessen the substitution effect. As a result the net impact of broader market opportunities on fertility may conceivably turn positive for women with high potential wages (Ermisch 1989). In that regard, Del Boca et al. (2005) show that Italian regions with bad child care provision have experienced larger fertility decreases.
Murphy (1992) cites from a report of the Royal Commission on Population in 1949: “The heavy unemployment of the inter-war period must have affected the attitude to parenthood not only for the workers who at any one moment were out of work but also of the far larger number for whom it was an ever-present threat”. Other analyses have also found a negative relationship between different measures of unemployment and first births (De Cooman et al. 1987; Ermisch 1988; Macunovich 1996; Ahn and Mira 2001; Kravdal 2002).
The dataset also includes, for later waves, observations from the Luxembourg and the British household panels (PSELL and BHPS) converted for comparability with the ECHP. Some of the interviews were conducted in 1993 and in 2001.
Results are robust to restricting the sample to women 38 and younger. Further, in the data less than 0.7% of children live with their father and not their mother, so this is not likely to bias the results in any important manner.
Kravdal (2007) has shown the estimated impact of education to be sensitive to whether the variable is entered as a fixed covariate or not. In the first estimates of this article in Section 4 only the highest educational attainment is used since we lack information to trace back the time at which each degree was achieved from age 16. However, in Section 5, education is time-varying since we limit the analysis to the years when the individual is interviewed.
The absence of large within-country variation constitutes a problem for some of the covariates of interest such as government and part-time employment, but not as much for measures of unemployment. For the decades of the 1980s and 1990s, country dummies alone explain close to 90% of the variance of government and part-time shares in the panel of European nations, but only around 64% of unemployment differences—and less than 40% when the sample extends to the late 1960s.
Postponement of first birth brings risks that women will not have all the children they intend (Morgan 2003). In the 1999 Spanish Fertility Survey, among women who report a gap between their preferred family size and their actual fertility, economic constraints appear at the top of reasons for restricting fertility. Necessity to work outside of the home and unemployment of either the woman or her spouse are also ranked high (Adsera 2006).
If country dummies are excluded the simulated percentage of mothers at age 30 in the two scenarios above moves to 71 and 53, respectively, and the simulated fertility rates fluctuate considerably from 1.98 to 1.42. Results are available from the author.
However, in cross-country estimates, transitions to first births are, on average, faster where female participation is higher. This is consistent with the positive cross-country correlation between fertility and female participation found since the mid-eighties in the OECD (Adsera 2004).
Bianchi (2000) shows that, even as they (re)enter the labor force, mother’s time with children in the US is fairly constant and women use part-time or temporary exits from the labor force to accommodate those needs. The ability to remain, at least, partially attached to the labor market may minimize the depreciation of women’s skills (and its negative income effects). However some low-wage unstable part-time jobs may be similar in their effects to the short-term contracts mentioned above (Ariza et al. 2005).
When country dummies are excluded, larger maternity benefits are associated with faster second births.
In separate estimates I have interacted foreign birth with all the covariates in the model to analyze whether either unemployment, the availability of certain types of employment or demographic characteristics are associated with transition to maternity in a distinct way among those born abroad. Only the coefficient for low educational achievement is significant indicating that low educated migrants are those who become mothers the earliest.
When country dummies are excluded, the index of disposable income is positively associated with transitions to first and second birth and pre-primary enrollment with second and third births. Overall, findings in Table 3 are robust to excluding one country at a time. Estimates are available upon request.
I estimated additional models of first births that included an interaction between female unemployment and a dummy for either Southern countries or those with a particularly persistent female unemployment such as Belgium and/or France, in addition to Southern nations. The coefficient on these interactions is in general negative but its size and whether it is significant hinge on the particular countries included in the group. The main coefficient on female unemployment remains significant in the range of −0.011 and −0.014, close to estimates in column 1, Table 3. Results are available upon request.
I use total instead of female long-term unemployment rates because data series are more complete. Both rates move closely though female rates are slightly higher in Southern Europe and are slightly lower in the UK and Ireland, countries with moderate unemployment. As a result, using female long-term unemployment would only strengthen the results.
Several works conclude that attrition biases in the ECHP are relatively mild and low for individuals living in couples as the great majority in this sample (Nicoletti and Peracchi 2005; Ehling and Rendtel 2004). Longitudinal individual labor market information is limited for Sweden and this country is excluded from this sample.
Income is converted to Euros and adjusted for differences in purchasing power with the index provided in the ECHP dataset.
In 1984 Spain allowed non-permanent contracts with temporary subsidies for new hires. The percentage of female workers holding temporary contracts increased from around 5% in 1984 to over 35% in less than 10 years. Temporary employment also rose in Italy during the late 1980s and the 1990s as employers were searching for means to reduce non-wage costs.
This legislation was developed after the Swedish model. When Swedish mothers have a child before their first-born is 30 months old, their earnings (prior to maternity) continue to be the basis for the cash benefits they receive (Gustafsson et al. 1996) for the second child. This provides a financial incentive for “speeding up” births without reentering work.
Estimated coefficients also suggest a positive income effect from a spouse’s college education. In country specific estimates available from the author, women whose spouses were highly educated and/or employed in the public sector transited relatively fast to second and third births in Southern Europe where families still relied more heavily on spouse’s employment and faced higher job uncertainty than elsewhere in Europe (Ahn and Mira 2001).
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Acknowledgments
I would like to thank Patrick Heuveline, Bo Honore, Bob Kaestner, Kevin Milligan, Ernesto Villanueva, two anonymous referees, and seminar participants at University of British Columbia, University of Calgary, George Mason University, University of Illinois Urbana-Champaign, University of Chicago, Universitat Pompeu Fabra, Universitat de Barcelona, ESPE, PAA, Midwest Economics Association, and Cristina Mora for excellent research assistance. This paper was made possible by Grant Numbers P30-HD18288 and T32-HD007302 from the NICHD. Its contents are solely the responsibility of the author and do not necessarily represent the official views of the NIH.
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Appendix
Appendix
See Table 9.
Labor market and income per capita covariates (1968–2001): OECD Labour Force Statistics, OECD Economic Outlook and national official statistics. Part-time employment and long-term unemployment are only available for 1979–2001. Public sector employment for Luxembourg is available from 1985 and long-term unemployment from 1985 for Portugal and from 1991 for Luxembourg, Italy, and Greece. Unemployment rates are annual for 1969–1982 and monthly starting in 1983.
Maternity benefits (1968–2001): Social Security Programs throughout the World (US Department of Health and Human Services, various years), The Jobs Study [OECD 1991], Maternity Benefits in the eighties: An ILO global survey 1964–1984 (International Labor Organization 1985) and Employment Outlook (OECD, various issues).
Gross Enrollment Rates in pre-Primary School (1971–2001): Gauthier (2003) and UNESCO Statistics. Note that this indicator can exceed 100% due to the inclusion of over-aged and under-aged pupils/students, therefore causing a discrepancy between the numerator and denominator of this index.
Total Family Benefits (1980–2001) as percentage of GDP from OECD Social Expenditures Database and index of Disposable Income (1972–1999) is available from Gauthier (2003).
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Adsera, A. Where Are the Babies? Labor Market Conditions and Fertility in Europe. Eur J Population 27, 1–32 (2011). https://doi.org/10.1007/s10680-010-9222-x
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DOI: https://doi.org/10.1007/s10680-010-9222-x
Keywords
- Low fertility
- Unemployment
- Economic uncertainty
- Labor market
- Europe
- Short-term contracts
- Public sector employment