What causes the earnings gap between men and women? If you listen to progressives, the answer is pretty clear: it’s sexism. It’s the privilege of powerful (white!) males. It’s men exhibiting prejudice against women in the workplace.
Yes, discrimination and workplace bias against women absolutely exist. Thousands of legal cases of people, usually women, being treated worse at work on account of their sex are heard every year.
Yet new research adds to the overwhelming body of research that suggests the sexes’ earnings gap is mostly not caused by discrimination or sexism. It’s not an unequal pay for equal work issue, it’s largely that women do different work.
The Earnings Gap Is Largely Driven by Culture
The new research looks at what happens to women’s earnings after they have a baby, compared to various benchmarks (spousal income before and after baby, similarly situated women who don’t have a baby: the method used finds similar effects regardless of the baseline measured against). What it finds is striking.
Having a baby massively lowers earnings for women in every country where it’s been studied. Even countries with very generous welfare systems like Denmark or Germany have much lower maternal earnings. Strikingly, the correlation between how generously a country supports moms and maternity leave tells you very little about the maternal earnings gap: low-maternity-leave America has a smaller baby earnings penalty than much-more-generous Austria or Germany.
So what explains this gap? Well, it turns out that it’s mostly driven not by changes in wages or hours worked, although there are effects there, but by changes in the odds that a woman works at all. That is to say, this isn’t mostly about mommy-track jobs, or unequal pay for equal work. It’s about stay-at-home-moms.
The authors estimate the penalty to labor-force participation similarly to their estimates of earnings. They find changes in labor force participation account for a majority of the change in women’s earnings in every country except Sweden. In the United States and United Kingdom., changes in employment account for more than 100 percent of changes in women’s earnings, meaning that, apparently, moms who do return to work actually earn more than non-moms.
This graph correlates more nicely with policy differences but, again, there are offsets: countries where more women return to work, like Sweden and Denmark, evidently have more women working part-time or for lower-wages: the so-called “mommy track.” Countries where fewer women return to work, like the United States and United Kingdom, ultimately seem to have lower penalties for the women who do return. In either case, what seems to be happening is that a lot of women value spending at least some of their time at home with kids.
This cultural value turns out to matter a lot. Using data from rigorously conducted social surveys, we can see what percentage of people in each country say it’s important for women to stay home with the kids.
It turns out that how many people in a society want moms to stay home with the kids is a very good predictor of the size of the earnings penalty. I have checked the underlying data, and confirmed that these trends hold up whether you use responses just from reproductive-age women, or responses from all people in society. But since the study authors use all people in society, I go with that metric. Suffice to say, the vast majority of the baby penalty on women’s earnings can be explained by the essentially voluntary, cultural preferences about childrearing of the women who decide to be stay-at-home moms.
The question of the earnings gap turns out to be fairly straightforward. These same study authors showed in a previous study that most of the earnings gap between the sexes in at least some countries is explained by women having a baby. That is in turn primarily driven by the cultural values that motivate some women to become stay-at-home moms while their kids are in school.
Some progressives will nonetheless say there’s a problem here in need of a solution: women shouldn’t want to stay home with the kids. In this telling, women will never be equal until they are all working like men, earning market income like men.
But this is a perverse argument that willfully ignores what women say they want. Surveys show that majorities of moms, even working moms, want to be stay-at-home moms, and large shares even of women who aren’t moms desire to be full-time homemakers. Arguing that these women are making some inherently bad choice that needs correction is simply insulting to the hard work parents everywhere do, and especially moms.
The work parents do is not inferior work, it is not work they should feel ashamed of it, and it isn’t something society should be discouraging. If anything, we need more parenting, not less.
Government Daycare Won’t Help
This issue is particularly pressing now because many progressives have been arguing for expanded nationwide government daycare. This policy is misguided.
First of all, polls show that working moms who would prefer to stay home vastly outnumber the stay-at-home moms who would prefer to work: America’s bigger problem is not excessively expensive child care, but the excessive cost of non-child expenses that force moms who want to work as parents to also work in the marketplace.
Second, as the comparison to other countries shows, the reason women fall behind in earnings isn’t a lack of daycare. Germany and Austria have subsidized childcare, and moms fall even further behind in earnings in those countries than in America. Implementing daycare will not eliminate or reduce the baby penalty, because the “baby penalty” is driven by families’ preferences for parent-provided rather than daycare-provided childcare.
Third, publicly provided daycare is unfair. It taxes all families to subsidize the choices of families where both parents work. If the goal is to ease family budgets to give stay-at-home moms who want to work a chance to do so, a much better policy is a “parental wage”: just cut parents a check every month for each child they have. They can use it to pay for child care, or for something else they or their children need. It’s a much fairer policy than publicly funded daycare.
Fourth, publicly funded daycare will ignite a disastrous set of political battles that nobody wants. Will church daycares get public funds? How much religious content is too much? Will public daycare centers use e-Verify on their workers (they’d probably be required to do so under current law)? The can of worms that would be opened by publicly funded daycare is better left closed. If our society values providing support for parents, the way to do it is with a simple “parental wage,” not public daycare.
The gender gap is mostly driven, not by unequal pay for equal work, but by the fact that a lot of women in our country are performing the valuable work of full-time motherhood. These women mostly do not need or appear to desire free daycare. They could probably use society recognizing the value of their work and paying a parental wage.
But if that’s too far, society could at least do these moms the courtesy of butting out. They don’t need to be fixed, they deserve to be thanked.