The heterogeneous impact of uncertainty shocks on labour market outcomes for men and women

Todd Potts and Jennifer Roy

Applied Economics, 2025, vol. 57, issue 50, 8327-8345

Abstract: This study examines whether innovations to macroeconomic uncertainty affect labour market outcomes for men and women differently. Findings reveal that increases in macroeconomic uncertainty lead to recessionary outcomes, with the unemployment rate for men rising higher than that for women if the uncertainty is related to financial markets or economic policy. There is slight evidence that men’s labour force participation declines more than women’s during such shocks, but the ratio of real earnings is largely unchanged. Variance decompositions reveal that over the full 1979–2023 sample, the variance in uncertainty is responsible for as much as 14% of the variance in the ratio of men’s to women’s unemployment rate. This percentage is found to be higher when using only pre-COVID data.

Date: 2025
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DOI: 10.1080/00036846.2024.2399811

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