Working paper No. 87
By Phil Evans
The fall in aggregate unemployment in Britain between its peaks in 1984 and 1993 is wholly accounted for by a decrease in female unemployment. This remarkable improvement is associated with a fall in their inflow rate, is concentrated among women with young children, and is equally spread across all skill groups. Having discounted temporary demand-side explanations for these trends, we argue that improvements in the provision of workplace assistance to mothers returning to work after childbirth have reduced the labour market frictions associated with the presence of young children. That may be seen as a fall in the natural rate of unemployment.