Gender Differences in Self-Employment: Does Education Matter?

This article focuses on the question, to which extent gender-specific differences in the selfemployment ratio can be explained as a result of the vertical and horizontal structure of the educational system in Germany. Firstly, the influence of educational attainment and occupational skills on the entry of women and men into self-employment will be examined. Secondly we will verify the hypothesis that gender-specific differences in the choice of field of study form the main reason for the lower female self-employment rate. Finally, we will follow up the question to which extent women and men can make use of their acquired qualifications later on. The study is based on micro data files from the German Microcensus (1991 to 1999), carried out annually by the Federal Statistical Office and covers 1% of all German households. The findings demonstrate that a higher level of education is an important resource for female self-employment: In the period from 1991 to 1999 the growth in female self-employment was mainly due to the rising number of female university graduates. With regard to the occupational positions of female university graduates it can be asserted that those running their own businesses can be found more frequently in qualified occupations and high managerial positions than their colleagues in paid employment. Furthermore, the field of study is an important determinant for women’s entry into self-employment. Areas of study that most favour the entry of women into self-employment are the so-called “integrated” ones. In contrast, women who study male-intensive as well as female-intensive branches have lower probability to switch into self-employment. However, the gender-specific differences on the level of self-employment cannot be explained substantially by different choices in the fields of study. Assuming that women selected the same areas of study as men with the area-specific self-employed ratio remaining constant, the overall “gender gap” would not be reduced considerably. On the other hand, if women kept up their fields of study, while the female area-specific self-employment ratio increased to that of the male ratio, the female overall self-employment ratio would rise by more than 4%. Thus, for a substantial reduction in the self-employment gender gap, an adaptation of female choices in the fields of study to male ones does not seem to be an adequate measure.