Trends in Women’s Labor Supply and the Family Income Inequality: 1982-2001

Taek-Jin Shin, University of California, Berkeley

This paper shows the results from an analysis of women’s labor supply in the United States and draw inference on the relationship between female labor supply and family income inequality. Using the CPS data from 1982 to 2001, I analyzed the trends in the female labor supply. Disaggregated by education and family income, the data reveal a story that is not usually discussed elsewhere. Educational differentials in labor supply have been persistent, but income differentials have been narrowing. Women’s education continues to be a strong force driving women’s commitment to the labor market, whereas family income has become a less powerful disincentive for women’s employment over time. It is not simply more women in the labor force that caused a greater, or smaller, income inequality. With more high-income women in the labor market working longer hours than before, the family income distribution has become more unequal.