Do Gender and Age Matter in Employment - Sectoral Growth Relationship Over the Recession and Expansion

Abstract

This paper examines age- and gender-specific employment sensitivity to growth across different economic sectors. The study applies a nonlinear panel specification of Okun's first-difference equation on EU-28 countries for 1995-2019 and uses OLS to estimate age-, gender-, and sector-specific employment intensities of growth. Our study examines the ability of growth in different sectors to generate total employment opportunities. Results show that regardless of gender or age, employment growth is mainly driven by the services sector growth. Still, if we consider the share of a sector in the economy, the construction sector is found to be the most employment-intensive. Our estimates show that the male and female employment intensities of growth in services are quite equal. Considering the employment opportunities by gender, the main differences were found in the construction sector. Expansion and recession were confirmed to have a significantly different effect on the employment rate only in the construction sector regardless of age and gender. Contrary to findings in studies on the unemployment version of Okun's law, we do not find significantly higher employment-output elasticity for youth compared to total employment.