What causes the gender pay gap?
Even when you control for occupation, education, age, and full-time employment, there's always a gender pay gap. So, just what causes it? That's a much harder question to answer, but there is a lot of research on this. It's important to note that the gender pay gap is narrowing, but that's due in part to the stagnation of men's wages since 1979.
Women's wages have grown due to increased education and workforce participation. But, because high earners are experiencing the biggest wage gap, improvements to women's pay haven't done much to eliminate the wage gap at the top.
It may come down to societal expectations and the heavier burden that they tend to place on women vs. men. Often, women are expected to drop their career aspirations to care for children or elderly family members, whereas men are less likely to be asked to shoulder these responsibilities.
A study looking at MBA recipients showed that in the 10 years following graduation, only 10% of men had experienced a career interruption of more than six months compared to 32% of women. By year 16, around 40% of women had experienced a career interruption. After such a break, workers may find it difficult to regain their earning power.
These same expectations can also affect how many hours a woman can work at her job, which will influence the types of jobs she may be able to secure and maintain. High earners, especially in the financial sector, are generously rewarded for putting in long hours. But if you have a child at home and are expected to be the primary caretaker, being unable to work long, inflexible hours could lower your earning potential.
Research also shows that when controlled for other variables, including education and experience, mothers are paid less than women without children in the same jobs. This is known as the motherhood pay penalty, and it is another complex variable in the gender pay gap equation.
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