The family gap in wages and careers

MEMORANDUM No 1:2006 The family gap in wages and careers By Geir Høgsnes, University of Oslo Andrew Penner, University of California, Berkeley Trond Petersen, University of California, Berkeley and University of Oslo

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The report investigates how family and children affect female and male wages and careers.
We analyze wages of men and women, their wage increases, promotions, changes to part-time
work, choice of occupations, choice of employers, and exits from employment. How do these
outcomes depend on family status, the presence of children, number of children and their age?
The main objective is to assess whether there is a reward to fatherhood and/or penalty to
motherhood and to what extent effects vary over time. The analyses are based on large-scale
data from employees within firms, which are members of the Confederation of Norwegian
Business and Industry (NHO). The data cover the period 1980-1997. The main findings are
the following:
First, the role of marriage and children for wages varies over time. At the beginning of
the period male wages increased with marriage and children while they were decreasing for
females. At the end of the period, in 1995-97, the effects of marriage and children were more
similar for men and women with less of a negative impact for women’s wages.
Secondly, concerning the wage gap between men and women, it is larger for those
with children than those who are single or without children. At the population level the wage
gap at the end of the period (1995-97) was at the level of around 20% among those married
with children. This significant gap, however, to a large extent is due to different sorting of
men and women on occupations. That is, once men and women work in the same occupation
and for the same employer the penalty for married women with children is much lower, less
than 5% compared to men.
Thirdly, concerning the impact of marriage and children on wage changes, there are no
effects for men. There is, however, a clear negative effect of wage growth of being female. At
the same time, for women there are small positive effects of children to begin with, but at the
end of the period the presence of children had little impact. By and large, the gross effect is
that women receive lower wage increases than men, but that there is no additional negative
effect of having children at the end of the period.
Fourthly, women are promoted at a significantly lower rate than men. The difference is
declining toward the end of the period, but still the differences are substantial. In the early
period, having children helped the promotion rate for women, but in the last period it was
detrimental. This is in contrast to the results concerning marital status, children and wage
gaps.
The report also investigates various adaptations to family status and children. The
question was what impact family status and children have on exiting the private sector, on
changing from full-time to part-time work, on changing establishment, career ladder,
occupation, and moving to a lower-ranked occupation. Here the findings are that for men,
family status and children made little difference for these adaptations, while for women the
effects were often major.
The most significant sex differences were observed in relation to exiting the sector and
changing to part-time work. Women did so at a much higher rate. None of these processes
were much modified when switching to the different levels of analyses; establishment,
occupation, and occupation-establishment. The lack of such modification is not surprising
given the climate for and practice of parental leave and part-time work in Norway.
The main conclusion is that it seems to have become easier for women to combine family,
children and career over the 18-year period. It is still, however, the case that women withdraw
from the sector at a higher rate than men, and more frequently change to part-time
employment whereas men rarely do. This difference may result in women losing ground
relative to men in competition for promotions, better assignments, and larger wage increases.
Their position relative to men in their adaptive behaviour in exiting the sector has improved
but the gap is still there and is large. One may speculate whether the declining gap in exiting
the sector, and the still remaining gap, can account for part of the decline in but continued
presence of the gender gaps in wages and promotions.
 

Av Matthew Whiting
Publisert 23. sep. 2010 10:12 - Sist endret 10. okt. 2010 12:27