Women spend too much time on housework relative to men, new research suggests, and it's probably dragging on U.S. productivity.
That's the first finding in this week's economic research wrap, which also looks at changes in the way women have spent their days in recent years and summarizes studies on spillovers from central bank balance-sheet normalization. Check this column each Tuesday for new and topical research from around the world.
Less time for bringing home the bacon
Women have less time for on-the-job labor because they spend more time doing housework than their male counterparts — so they miss out when they're working in fields that reward long hours, based on a new National Bureau for Economic Research study. Some women shy away from jobs in fields that require long workweeks, knowing they won't have the time: a 10 percent cut in free time for women reduces their share in high-hour occupations by about 14 percent relative to men, according to the researcher's model.
In total, that difference in time spent on at-home labor results in an 11 percentage point gender wage gap, their analysis estimates. All of this may seem pretty intuitive, but here's the surprise: the pattern hurts society as a whole. If labor were instead allocated in a gender-neutral way, welfare would increase and output per hour would climb by 5.4 percent as people made better use of their time, given their skills.
"Our main message is that developing a theory of time allocation and occupational choice is important for understanding the forces that shape gender differences in labor market outcomes," the researchers from Universidad Carlos III de Madrid, University of Toronto and Princeton University write.
Hours, Occupations, and Gender Differences in Labor Market Outcomes
Published July 2017
Available on the NBER website
The silver lining in the gender labor divide
On the bright side, women are finding a way to spend less time on chores and shopping, even if men aren't stepping up to the plate when it comes to housework.
A new Bank of America Merrill Lynch analysis of American Time Use Survey data show that only 46 percent of prime-age women engaged in housework in 2014 to 2016, versus 52 percent in 2003 to 2005. Where women did housework, they were spending five minutes less on it, on average. That shift came as prime-age men contributed a few more minutes of housework, but not enough to offset the gap, suggesting that the tasks like laundry and cleaning are probably being outsourced, while online shopping is more efficient.
As they spent less time on chores, women worked and slept more, the data show. The trend is probably going to persist going forward, the economists suggest, especially as younger groups of women have become more educated — affording them the affluence to work more and spend time with their families while hiring someone else to do the dusting.
A day in the life of a working woman
Published July 28, 2017
Available to Bank of America subscribers
How will balance-sheet normalization effect emerging markets?
As the Federal Reserve looks toward normalizing its $4.5 trillion balance sheet and the European Central Bank contemplates when to taper off its quantitative easing program, International Monetary Fund researchers are asking a timely question: will such adjustments in advanced economies have a different effect than tightening that comes via interest rates?
The answer is yes, based on their logic. While emerging markets can mitigate spillovers from rate changes by aligning short-term policy rates with the advanced central bank, there's no simple way to offset cross-border financial spillovers coming from a balance sheet unwind like the one the Fed is headed toward. This matters a lot for economies that are pegged to the dollar, like Hong Kong. "Simply aligning the short-term policy rate will no longer be sufficient in shielding EMs from external monetary spillovers," the researchers write.
Central Bank Balance Sheet Policies and Spillovers to Emerging Markets
Published July 25, 2017
Available at the International Monetary Fund website
Speaking of spillovers...
Economists at Goldman Sachs Group Inc. take a look at another balance sheet-relevant issue, digging into how normalization will impact other major economies. They find that U.S. rate hikes lead to a larger trade-weighted deprecation in the euro and the Japanese yen than balance-sheet unwinding, so that rate-based tightening is responsible for a bigger boost to growth and inflation in those countries. They also take a look at China, which will see a stronger currency as the U.S. tightens thanks to its dollar link. The effects on Chinese growth and inflation are most negative when the Fed hikes rates and the ECB tightens via the balance sheet, based on the Goldman analysis.
In a nutshell, "the FOMC's plan to use the balance sheet rather than the funds rate as its next tightening step is helpful for China, but acts as a drag on growth and inflation in the euro area and Japan," Goldman economist Sven Jari Stehn writes.
Global Economics Analyst: Policy Rate vs. Balance Sheet Spillovers
Published July 28, 2017
Available to Goldman Sachs subscribers