Research Note: Closing the gender gap in Australia’s workforce participation

Increasing women’s participation in the workforce is a major social and economic imperative. Despite significant improvements over the last two decades, women are less likely to be employed than men, work fewer hours than men, and as a group are paid less than men. These gender gaps in employment outcomes have negative impacts on women’s economic security, and deprive businesses a critical component of the workforce at a time of major skills shortages.

One of the key drivers of these gender gaps is women’s lower participation in the workforce. Women make up 47.9% of the Australian workforce, despite being 50.8% of the working age population. While the gap has been closing for many years, on present trends it will take another one to two decades to achieve parity in workforce participation.

This research note examines changes in women’s workforce participation in Australia. Utilising newly-available microdata from the Australian Bureau of Statistics, it explores the factors driving increased female participation across industries and age groups.

Some of our findings are quite surprising. Women’s employment is increasing, but the number of hours they are working are increasing faster. Many industries are roughly gender equal, but some remain male- or female-dominated. It is traditionally male industrial sectors – like manufacturing, construction and mining – which are seeing the fastest growth in women’s participation. And it is women at the older end of the age spectrum who are leading the charge,

Women’s employment is increasing, but the hours they work are increasing faster

First, the good news – Australia is making good progress towards overall gender parity in workforce participation. In early 2025, women comprised 47.9% of the labour force, a record level. The female share has been steadily trending up for the last two decades and is rising by around 0.15% per year. At this rate, Australia should achieve workforce gender parity sometime in the late-2030s.

However, a better measure of women’s labour market participation is given in terms of hours worked rather than people employed. This is because women are more likely than men to work part-time, and so measuring by people over-states women’s contribution to the labour force. When measured on the basis of total hours worked, women comprise 42.9% of the workforce, 5% less than the headcount number.

However, looking at hours also reveals a faster rate of closure in the gender participation gap. In 2006 women contributed only 38.1% of the hours worked in the economy, but the share has risen by an average of 0.25% per year to close the gap with overall participation. This is because women in the labour force are working more hours than they did in the past, leading to a faster rate of closure for the hours gap. On current trend, it is likely to achieve gender parity in the late-2040s.

While it is good to see the gender gap closing at a solid rate, the fact it will persist for another two decades has significant implications for the female workforce. On the employee side it can mean lower total income, limited career advancement and potentially less job satisfaction. For businesses, it affects a range of factors linked to workforce capability including labour and skills shortages, as well as other business impacts such as employee retention, regulatory compliance and gender pay gaps.

Gender-dominated and gender-equal industries

So what is driving the uptick in women’s labour force participation? To understand the dynamics we need to look to industry level patterns, where we can identify three clusters of gender participation.

At one end are the female-dominated industries of education and healthcare & social assistance. The latest data shows that women contributed over 70% of the hours worked in these industries. These ‘care’ type industries make extensive use of female dominated occupations such as teachers, carers and health professionals.

At the other end are male-dominated sectors, where women account for around a third of the hours worked. These tend to be industrial sectors that make use of male dominated trade and labouring occupations. It also includes some technology and service sectors (like IT) with many technical roles. Construction has the lowest female share with just 11% of hours done by women.

Between these two extremes lie a group of relatively gender balanced industries, where the share of hours worked by women falls into the 45-55% range. The group is diverse, but includes a range of service industries including both consumer oriented and administrative industries. The financial sector, conventionally thought of as a male-dominated industry, actually sees women performing 48% of the hours worked – higher than the national average of 43%.

Much of the gender gap in the Australian labour market therefore originates at the industry level. The overall gap emerges due to the relative balance of women’s over-representation in care industries against their under-representation in industrial sectors. So how are dynamics changing in these two gender-equal outlier groups?

Male-dominated industrial sectors lead on closing the gender gap

Gender dynamics in in male-dominated industrial sectors are surprising. On one hand they have the lowest share of female hours worked, but they are also leading the national effort in closing the gender participation gap.

As the chart below shows, over the past 20 years most industrial sectors showed an increase in the proportion of female hours worked. The largest uplift in hours has been in the industries with the lowest female participation - construction has seen female hours worked rise from 8% in 2006 to 11% in 2025, and mining from 13% to 18%. While coming off a low base, industrials have delivered the fastest rates of gap closure of any industry group in Australia.

By contrast, other industries have not seen their gender balance change much over the last twenty years. The gender-balanced industries have seen their rates stay relatively constant at around 40-55%. For female-dominated industries, healthcare & social has stayed at around 75%, while in education gender segregation has gotten worse, with the female share of hours rising from 66% to 71%.

This means it is industrial sectors – and only industrial sectors – which are showing any progress in closing the gender gap in workforce participation. Why are these traditionally male industries doing most of the work?

Social and cultural shifts for both men and women are leading to more equal expectations of workforce contribution. Following this, government and business policy initiatives have enabled an uplift in female employment and hours. Targeted plans within businesses to improve gender balance including gender improvement programs and female apprenticeships are among some of the efforts that have had a measurable impact.

Increased female uptake of STEM at the secondary and tertiary level have led to a wider pool of candidates for technical roles. At the same time, ongoing skills shortages have pushed businesses to widen hiring searches. Increased technology adoption and automation has reduced the physical demands of some industrial jobs enabling a broader pool of people to participate.

Government measures such as reporting requirements and project tender criteria have put gender firmly on the agenda for many industrial businesses, impacts absent in non-industrial sectors. Male-dominated sectors have faced a level of scrutiny and societal pressure to change that female-dominated sectors haven’t.

Older women are driving the increase in women’s workforce participation

There is also a demographic dimension to the steady increase in women’s labour force participation. Female participation in the Australian workforce is at its highest level since records began. Over the past two decades the proportion of all women aged fifteen and over in the workforce has steadily increased from 58% in 2006 to 64% in 2025. Men’s participation has been broadly stable at around 70% during this time.

Importantly, age plays a key role in explaining the dynamics behind women’s increasing participation.

Middle aged female cohorts – those 25 to 55 years old - have the highest levels of engagement. This reflects income needs, workforce support, social change, educational attainment and career momentum at this stage of life. These groups have seen a moderate increase in participation of around 5% over the last two decades. This can be attributed to initiatives such as broadened parental leave, increased workplace flexibility, and the expansion of childcare availability, all of which enable greater participation.

However, the most significant rise has occurred among women over 55 years old. This group has historically had much lower rates of participation, reflecting the fact that women retire from the labour market earlier than men. But over the last two decades their participation rate has soared, jumping from 48% to 64%. This has closed much of the gap between older women and the average. Women who entered the workforce in the 1980s ago have stayed attached rather than exiting during their 50s as they did in previous decades.

The upward trend for this group is driven by multiple factors. Changing social and cultural attitudes have also seen stronger labour market attachment in middle age, which has carried forward into delayed retirement. Higher levels of education and skill attainment, as well as better health and physical capability contribute to this trend. As workplaces have evolved with automation and technology, some jobs have become less physically demanding, allowing people to remain in the workforce longer. Changing financial pressures may also encourage continued workforce engagement. Together, these shifts highlight the shifting dynamics that have led to an increase female workforce participation across different age groups.

Untapped labour and skills resource

Australian businesses have been navigating a prolonged period of labour and skills shortages, driven by a persistently tight labour market. Unemployment rates have remained at historically low levels over the past few years, while job vacancy rates sit well above long-term averages. These conditions have placed significant pressure on employers to find and retain skilled staff.

One underutilised resource in this context is the gap between the number of women employed and the total hours they work. Women working part-time hours who would prefer to work more hours if given the opportunity and necessary supports could do so. This indicates a pool of available labour of staff that may already have the education level, skills and training, making them well-positioned to fill existing shortages.

Increasing hours for current employees, redesigning roles for part-time workers including flexibility, could unlock this latent capacity. Doing so not only helps address immediate staffing challenges but also supports broader goals around gender equity and workforce participation particularly in the imbalanced sectors. Maximising the potential of existing employees, particularly women seeking more hours in industrials and men seeking more hours in education, health and social assistance, represents a practical solution for shortages.