Who bears the burden? Age dependency and gender employment gap

As demographic structures change, demographic pressures increasingly threaten labor market inclusivity and sustainability. Age dependency, traditionally defined as the proportion of the population younger than 15 or older than 64 relative to the working-age population, is expected to place a greater burden on women, particularly in relatively low-income countries where caregiving responsibilities disproportionately fall on female workers. Given this expectation, this study investigates the impact of age dependency on the gender employment gap across 20 OECD countries from 2010 to 2021. Our analysis confirms the widening effect in lower-income members, while increasing age dependency does not affect the gender employment gap in higher-income members. Focusing on lower-income OECD countries, we find that institutional quality helps counter the impact of age dependency on the gender employment gap. Even when the gender wage gap narrows, an outcome often seen as progress, our results show that the widening effect of age dependency on the gender employment gap becomes stronger. Nonetheless, high institutional quality continues to counter this impact. These findings highlight the importance of institutional readiness in addressing the intersection of demographic change and labor market inequality, with direct implications for policy agendas related to inclusive growth, aging societies, and the Sustainable Development Goals.