New studies show kids, marriage wreak havoc on pay gap

Reports show women have equal pay with men — right up until childbirth

When men and women finish school and start working, they are paid pretty much equally. But a gender pay gap soon appears and grows significantly over the next two decades.

So what changes? The answer can be found by looking at when the pay gap widens most sharply. It’s the late 20s to mid-30s, according to two new studies — in other words, when many women have children. Unmarried women without children continue to earn closer to what men do.

The big reason having children, and even marrying in the first place, hurts women’s pay relative to men’s is that the division of labour at home is still unequal, even when both spouses work full time. That’s especially true for college-educated women in high-earning occupations: Children are particularly damaging to their careers.

But even married women without children earn less, research shows, because women are more likely to give up job opportunities to either move or stay put for their husband’s job. Married women might also take less-intensive jobs in preparation for children, or employers might not give them more responsibility because they assume they’ll have babies and take time off.

“One person focuses on career and the other one does the lion’s share of the work at home,” said Sari Kerr, an economist at Wellesley College and an author of both papers. One will be published in the American Economic Review this month; the other was published this month as a working paper by the National Bureau of Eco- nomic Research. The other researchers were Claudia Goldin of Harvard, Claudia Olivetti of Boston College and Erling Barth of the Institute for Social Research in Oslo.

It is logical for couples to decide that the person who earns less, usually a woman, does more of the household chores and child care, Kerr said. But it’s also a reason women earn less in the first place. “That reinforces the pay gap in the labour market, and we’re trapped in this self-reinforcing cycle.”

To achieve greater pay equality, social scientists say — other than wom- en avoiding marriage and children — changes would have to take place in workplaces and public policy that applied to both men and women. Examples could be companies putting less priority on long hours and face time, and the government providing subsidized child care and moderate-length parental leave.

According to the data, Kerr said, college-educated women make about 90 per cent as much as men at age 25 and about 55 per cent as much at age 45.

The new working paper, which covered the broadest group of people over time, found that between ages 25 and 45, the gender pay gap for college graduates, which starts close to zero, widens by 55 percentage points. For those without college degrees, it widens by 28 points.

Much of that happens early in people’s careers, during women’s childbearing years.

The pay gap is larger for college graduates because their earnings are higher and men dominate the highest-paying jobs. These jobs also place more value on long, inflexible hours.

People without college degrees start out with a slightly larger pay gap, but it is smaller throughout their careers. Part of the reason is that less-educated men have fewer highpaying job options than they used to.

Twenty-seven per cent of the overall pay gap is from men being more likely to jump to higher-paying firms, the economists found. When married women leave jobs, they are less likely to get a big pay bump as a result.

But the bulk of the pay gap — 73 per cent, they found — is from women not getting raises and promotions at the rate of men within companies.

“On every possible front, women are getting the short end of the stick,” Kerr said.

“On every possible front, women are getting the short end of the stick.” SARI KERR ECONOMIST