Understanding the "Family Gap" in Pay for Women with Children

T he narrowing of the gender gap in pay in the 1980s and 1990s, following decades in which the gap between the hourly earnings of women and men held constant, has been one of the most notable trends in the labor market in recent years. The decline in the gender gap has been all the more remarkable because it occurred while other types of wage inequality were increasing. These recent trends in the gender gap and in wage inequality have been extensively studied. However, less attention has been paid to the ''family gap''—the wage differential between women with and without children. 1 Over the past few decades, as the gap in pay between women and men has been narrowing, the gap between women with children and those without children has been widening. Why is this the case? One reason may be the institutional structure in the United States, which has emphasized equal pay and equal opportunity policies, but not family policies such as maternity leave and child care. Other industrialized countries that have implemented family policies along with their gender policies seem to have had better success at narrowing both the gender gap and the family gap. Although much of the evidence on links between family policies and women's pay is speculative, there is one policy—maternity leave—where we now have more persuasive evidence. Recent research in the United States, as well as comparative research on Britain and Japan, suggests that maternity leave coverage may raise 1 Other types of family-related gaps may exist—for example, those between women with responsibility for aging parents and those without—but here the focus is on women with children and those without. Also note that the family gap refers to the differential in hourly wages, so mothers' lower work hours do not directly affect the gap (although they may affect it indirectly through lower acquired human capital).