In this post I summarise a recent study I published in collaboration with R. Breen on the motherhood penalty entitled “Earnings and Income Penalties for Motherhood: Estimates for British Women using the Individual Synthetic Control Method” published in the European Sociological Review.

Introduction

The gender gap in pay often makes the headlines. But how this gap comes about is less talked about. One central factor contributing to the persistence of inequality in pay between men and women is parenthood. The birth of a child affects mothers and fathers very differently. For a mother, the birth of a child is an event with long lasting consequences on her career, while for a father, it has little impact to no impact on his. This phenomenon is known as the “motherhood penalty”.

Our Study

In our study, we investigate the motherhood penalty in earnings and in household income for mothers in the UK (1991-2008). Using a novel methodology (more here), we estimate the causal effect of first birth on mothers’ earnings and on household income up to six years after the birth. We empirically demonstrate that motherhood has a large negative impact on mothers’ earning growth. We estimate that on average mothers lose about 45% of what they would have earned if they did not have a child. This number is large but similar figures have been reported in other studies (see here Figure 2 for the UK). We find that the penalty grows over time, which is also consistent with other studies.

One innovation of our paper is to show that the average causal effect of motherhood on earnings can hide important variations in the earning penalty of having a child. While most mothers experience a long lasting reduction in their earnings, we find that a small number of women experience a positive growth in earnings. On the other hand, we also find that some women experience a very large penalty, much larger than the average penalty. This insight into the variation of causal effects is important because it indicates that no life trajectory is the same and probably no one solution will fit everyone’s circumstances.

We tried to understand what factors played a role in the earning penalty. We found that older mothers (over 30 years old) and highly educated mothers suffer a smaller penalty. The finding regarding education differs from other studies who found that highly educated mothers were affected the most in their career by parenthood. More evidence is needed here to understand why our finding differs from others studies.

One factor did stand out in explaining the earning penalty: working hours. This result is consistent with several other studies (here) and (here). We found that mothers who are able to maintain full-time working hours experience little to no penalty. However, few mothers manage to do so. After the birth of their first child, few manage to return to their pre-birth working hours.

The second part of our study is concerned with household income. We found more variability in the effect of children on household income. We found a small negative average effect of having children on household income. In other words, the birth of a child, on average, reduces household income, and can put some families in a difficult financial situation. But this average effect is slightly misleading because some households experience a large reduction in income, and others experience growth in household income.

We found that highly educated households did experience a growth in household income after the first birth compared to other households, who mostly experienced a loss of income. Education seems therefore to be a protection against financial vulnerability during parenthood. Again, we found that a mother’s working hours did play an important part in determining the household income penalty. This result highlights the importance of women’s contribution to household income. This has ramification for gender equality between but also within households. We did find that the transition to parenthood creates an earning gap between a father and a mother from the same couple. While it seems that the earnings of mothers and fathers are roughly equal before parenthood, they strongly diverge after the birth of a child, with mothers being much more likely to experience a reduction in their income. This result suggests that the birth of a child creates long-lasting inequalities in the balance of earnings within couples.

Conclusion

The motherhood penalty is now a very well documented phenomenon. Our study, as well as other studies, suggest that one of the most important mechanisms through which motherhood affects a woman’s career is that the birth of a child creates a very difficult “work-care balance” for mothers. The UK is a country with a very expensive private childcare system. Mothers are much more likely to be the ones putting their career aside with the birth of a child. Therefore, motherhood takes mothers away from the labour market during the prime years of career development. Mothers with young children miss out on important job opportunities and promotions.

Often, when mothers return to the labour market, they do so on a part-time basis. We know now that part-time work does not contribute to meaningful career progression (see this research paper on this point). Employers also take advantage of the fact that mothers are looking for flexible working arrangements and might offer them lower wages in return. Therefore, mothers are constrained to trade-off wages for flexibility and often have to take more flexible occupations where wages are lower. Fathers do not face this trade-off because they generally manage to take the backseat and enjoy the ride of parenthood. Some studies even suggest that fathers enjoy some kind of career premium when becoming dads.

Our study highlights that the motherhood penalty is not only important for understanding contemporary challenges of gender equality but that parenthood also reinforces existing social inequalities between households. More work is needed to uncover how parenthood generates forms of social and economic inequalities.