Labour force dynamics and the obesity gap in female unemployment in Finland

In this paper we analyse the obesity gap in female unemployment in Finland. A growing body of research has documented that women suffer from obesity penalties in the labour market, whereas men do not. In this paper, we focus on the link between obesity and female unemployment. Since the obesity gap in unemployment may be due to both worker and employer behaviour, our approach provides an interesting test case for analysing various hypotheses put forward to explain the obesity gap in labour market rewards. With data from the Finnish component of the European Community Household Panel, we start by decomposing the obesity gap in unemployment rates to transitions between labour market statuses. The results show that the difference in transitions from unemployment to employment is the most important component of the difference in unemployment rates. We further analyse this transition by performing event-history analyses of the transitions from unemployment to employment and by looking into the job search behaviour of obese versus non-obese women. The obesity gap in transitions from unemployment to employment remains after controlling for human capital and demographic features. Neither do obese women differ from their non-obese peers in job search behaviour. We conclude that employer discrimination is an important explanation of the obesity gap in female unemployment.