By Paul Walker 11/03/2017 4


The career dynamics of the gender gap for graduates of the Chicago Business School, as studied by Bertrand, Goldin, and Katz (2010), illustrate a common pattern. While women and men start their careers with similar earnings, a substantial gap arises over time, and the arrival of children is a major concurrent factor in the rising earnings gap. At least in this highly (and homogeneously) educated population, only a small share of the gender gap is due to premarket factors such as training and coursework; instead, family formation sets the gap in motion.

In short, kids are bad for the income of women. The above quote comes from Specialization Then and Now: Marriage, Children, and the Gender Earnings Gap across Cohorts by Chinhui Juhn and Kristin McCue, Journal of Economic Perspectives—Volume 31, Number 1—Winter 2017—Pages 183–204.

The conclusion of the paper reads, in part:

Given women’s gains in the labor market, Becker’s (1981) seminal model predicts that patterns of specialization should become less gendered. It predicts that the gender earnings gap associated with marriage should fall, and it has. However, the gender earnings gap associated with children has been more persistent, and the proportion of the remaining gender earnings gap associated with children has risen.

The persistent nature of the motherhood gap—particularly among professional women poised for high-paying careers, and among women who have access to generous leave benefits and childcare subsidies—brings home the point that women still devote much more time to child-rearing over the course of their careers than do men with similar human capital characteristics. One set of explanations put forward revolve around social norms that are slow to change and resist economic forces (Fortin 2005; Bertrand 2011; Bertrand, Kamenica, and Pan 2015). Social norms can serve as both push or pull factors. On the pull side, women may still by-and-large identify themselves as the primary caretaker of children. On the push side, work places may still be governed by norms from an earlier era of male breadwinners with stay-at-home wives. According to this set of norms, an employee is a “good” employee only if he or she is married to the job and willing to work long hours. A number of papers have shown that the gender gap is particularly large in jobs that require long hours (Goldin 2014; Gicheva 2013; Cha and Wheeden 2014; Cortes and Pan 2016) (Emphasis added.)

As an example of this consider some recent research that suggests women earn, on average, around 31% less that men in STEM (Science, Technology, Engineering or Mathematics) subjects after gaining a PhD.

The obvious question is why.

Perhaps surprisingly the answer to this questions can be reduced to just two factors: 1) field of study and 2) kids.

But after controlling for differences in academic field, the pay gap between males and females is reduced to around 11% in first-year earnings. There is a tendency for women to graduate in less-lucrative academic fields – such as biology and chemistry than comparatively industry-friendly fields, such as engineering and mathematics.

This 11% difference can be explained by the finding that married women with children earned less than men. Note that an unmarried, childless woman earned, on average, the same annual salary after receiving her doctorate as a man with a PhD in the same field.

These results come from a paper, “STEM Training and Early Career Outcomes of Female and Male Graduate Students: Evidence from UMETRICS Data Linked to the 2010 Census” by Catherine Buffington, Benjamin Cerf, Christina Jones and Bruce A. Weinberg published in the American Economic Review: Papers & Proceedings 2016, 106(5): 333–338.

This would suggest that if you are studying the pay gap between men and women two things to take into account are hours worked and time off for kids.

Featured image: Flickr / NTNU Faculty of Natural Sciences.


4 Responses to “Marriage, kids, and the wage gap”

    • We could say, more precisely, “that the evidence that we have so far tells us that kids are bad for the income of women but this could change in the future depending on what changes take place within the economy, and society more generally, from now on”. But it does seem a bit long-winded. From what we know about pay gaps, given the way society is currently, “kids are bad for the income of women”.

      • Actually Claudia Goldin makes the point that if you could change the labour market so that non-linear compensation schemes were reduced then the pay gap would be reduced.

        “Goldin has a less popular idea: that the pay gap arises not because men and women are paid differently for the same work, but because the labor market incentivizes them to work differently.

        Consider a couple graduating together from a prestigious law school, and taking highly paid jobs at firms that demand long hours. The evidence suggests they’re likely to begin at similar salaries. But a few years later, Goldin says, one of them—more likely the woman—may decide to leave for a smaller practice with fewer hours and more flexibility in scheduling. In that new job, research suggests, she’s likely to earn less per hour than her partner. Goldin calls this phenomenon non-linearity, or a part-time penalty: the part-timer works half the time her partner does, but earns less than half his salary.

        It isn’t clear, she says, why firms compensate on a non-linear scale in the first place. “Why would anyone pay for that?” she asks. Apart from scenarios in which a client might want a lawyer available at all hours, day or night—during a merger or acquisition, say—and must offer a hefty premium for that unrestricted access, she says, “It’s a question I don’t have a particularly good answer to.”

        Non-linear compensation prevails in the corporate sector, finance, and law, where employees are incentivized to work double or triple a traditional full-time schedule, because their time is better compensated per hour when they work longer hours. That compensation structure makes it more lucrative for one partner to work 80 hours and the other not to work at all than for both of them to work 40 hours each. If both partners opt for 40-hour weeks so they can share responsibilities at home, Goldin says, “lots of money is going to be left on the table,” which is why she believes so many couples don’t.

        Non-linearity helps explain why most of the gender pay gap occurs within professions, Goldin adds.” (http://harvardmagazine.com/2016/05/reassessing-the-gender-wage-gap)

        Of course firms use non-linear pay schemes for a reason, and its not clear how you could change that. If they think such scheme are a good idea, and they have had a long time to work this out, then they are not likely to change things.

  • I suggest that kids are good for job security (for both parents or caregivers). My observations from slightly outside “the system” suggest that the welfare of children is taken into account when it comes to making decisions relating to the employment of parents/caregivers. At it’s most simple, if someone has to be made redundant, it isn’t going to be anyone with a young family to support, not unless there isn’t any other alternative.

Site Meter