The effects of gender-specific local labor demand on birth and later outcomes

We study the effects of local labor market conditions during early pregnancy on birth and later outcomes. Using a longitudinal survey of newborns in Japan, we find that improvements in employment opportunities increase the probability of low birth weight and premature birth. We also examine the effects of gender-specific labor market conditions. An increase in labor demand for women has a large negative effect on gestational age, especially for mothers who gave birth at relatively young ages. However, we find little evidence of a lasting negative effect of an increase in labor demand during early pregnancy on serious health conditions or developmental delays in early childhood. Using prefecture-level panel data, we confirm that the negative effect on infant birth weight is not driven by selective fertility and mortality.