A new study by Stefania Albanesi, an economics professor at the University of Miami Patti and Allan Herbert Business School, highlights the substantial yet underappreciated impact of women on long-term U.S. economic performance. The research, titled “Changing Business Cycles: The Role of Women’s Employment,” reveals that increasing female participation in the labor force and advancements in their educational attainment contributed to 30 percent of total factor productivity (TFP) growth between 1969 and 2017—a metric reflecting how effectively labor and capital are utilized in the economy.
Albanesi’s analysis also identifies women’s employment patterns as a previously unrecognized contributor to the Great Moderation, a prolonged era of reduced economic volatility from the mid-1980s through 2017. While earlier explanations emphasized improved monetary policy and smaller economic shocks, this study argues those factors alone were insufficient. Instead, the growing presence of women in more stable industries helped buffer recessions and accelerate recoveries.
Contrary to the widely held belief that jobless recoveries became common after the 1990s, the data shows that men have consistently faced slower employment rebounds since the 1970s. Women, often employed in sectors less sensitive to economic cycles, maintained stronger job resilience during downturns and faster gains during upturns. However, starting in the mid-1990s, the upward trend in female labor force involvement plateaued. As a result, their recovery patterns began aligning more closely with men’s, contributing to weaker overall employment rebounds.
The paper, set for publication in the October edition of the American Economic Journal: Macroeconomics, includes a counterfactual scenario: had women’s workforce engagement continued rising, aggregate economic outcomes—including both employment and GDP—would have seen significant improvement.
Albanesi stresses the importance of disaggregating economic data by gender, even when analyzing broad trends. Ignoring such distinctions, she warns, leads to incomplete conclusions about macroeconomic behavior.
Looking ahead, the normalization of remote work during the pandemic enabled a strong rebound in women’s employment. Yet recent corporate pushes to return to office settings may undermine these gains, particularly given that women still manage a disproportionate share of domestic and caregiving duties.
“This could reverse the remarkable recovery we witnessed post-pandemic,” Albanesi noted, adding that such a setback would negatively affect overall economic performance—an outcome she describes as entirely preventable.
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Miami Herbert study shows women’s employment key driver of U.S. economic growth
A study by Stefania Albanesi, economics professor at the University of Miami Patti and Allan Herbert Business School, uncovers the critical and often overlooked role of women in shaping U.S. economic trends.
Albanesi’s work, “Changing Business Cycles: The Role of Women’s Employment,” shows that women’s rising workforce participation and increased education accounted for 30 percent of growth in total factor productivity (TFP)—an economic performance measure that reflects how efficiently labor and capital are used—between 1969 and 2017. Moreover, her research illuminates that women’s labor supply was a significant but previously unmeasured factor in explaining the Great Moderation, a period of macroeconomic stability from the mid-1980s to 2017.
“The research provides an additional channel that explains and contributes to The Great Moderation, which means it diminishes the roles of the channels that literature focused on [like smaller shocks and better policy],” said Albanesi. “Those explanations were not incorrect; they were just incomplete.”
Previously, it was believed that jobless recoveries in recessions after 1990 were true for the aggregate. Albanesi’s study reveals a surprising truth: since the 1970s, slow and incomplete job recovery has been the consistent reality for men. Women, on the other hand, tended to be less affected by job losses during recessions because of their employment in less cyclical sectors. They also experienced strong employment growth during recoveries, driving aggregate employment growth. However, this trend began to shift in the mid-1990s when women’s labor force participation stalled. As a result, their employment recovery began to mirror men’s more closely, leading to sluggish recovery in aggregate employment.
Albanesi’s research, to be published in the October issue of the American Economic Journal: Macroeconomics, further explores a hypothetical scenario: what economic performance would have looked like if women’s workforce participation had continued to grow.
“There would have been very substantial gains on aggregate economic performance, both in terms of employment growth as well as GDP growth,” Albanesi said.
This study also emphasizes that accounting for all drivers in research—like gender—is essential to fully understanding key economic phenomena.
“It’s important to disaggregate [the data], even if you’re just interested in how the aggregate behaves,” Albanesi said. “Otherwise, you’re going to miss part of the picture.”
Albanesi’s findings offer possible insight into current and future trends as well. Even if more women lost jobs during the COVID-19 pandemic, in its aftermath, women experienced strong employment growth due to the normalization of remote work. But, the recent push for return-to-office mandates could disproportionately affect women, who still shoulder a larger share of household and childcare responsibilities.
“It’s basically undoing this really impressive recovery that we saw in the years after COVID,” Albanesi said. “That’s going to have an effect on the aggregate economic performance and on aggregate employment as well—and it’s a totally avoidable effect.”