FENICs Female Employment and Family Formation in National Institutional Contexts Estimates of the Family Gap in Pay Research Objectives: Is there a penalty in pay associated with motherhood for women within Europe? Can these ‘family gaps’ be explained by differences in the characteristics of mothers compared to women without children? Do national differences reflect institutional structures?

FENICs Female Employment and Family Formation in National Institutional Contexts Reasons for a Family Gap in Pay Labour market experience (career breaks) Unobserved characteristics (lifestyle preferences) Part time employment – direct and indirect effects Occupational segregation Conflict between early motherhood and education

FENICs Female Employment and Family Formation in National Institutional Contexts Raw Estimates of the Family Gap (ECHP) 1 Child2 Children3+ Children Portugal82%90%68% Germany88%85%88% UK90%75%72% Belgium93%98%93% Spain93%94%82% Ireland99%94%91% Netherlands100%96%90% France100%105%86% Greece102%100%88% Italy105% 92% Denmark109%103%98%

FENICs Female Employment and Family Formation in National Institutional Contexts Identifying a Family Gap in Pay Data: ECHP (1994 to 1998 – Waves 1 to 5) BHPS (1991 and 1998/9) GSOEP (1990/1 and 1997/8) Estimation of earning functions (age, education, experience, partnership status, family status) Cross sectional estimates of pooled data (OLS/Heckman) Panel data techniques - BHPS and GSOEP only

FENICs Female Employment and Family Formation in National Institutional Contexts Estimates from the ECHP Women who became mothers before 25 exhibit larger family gaps in pay Gap increases with number of children present Excluding part-time employees does effect size of gaps Controlling for selection increases family gap where significant High: United Kingdom, Germany Intermediate: Netherlands, Ireland, Spain, Greece Low: Belgium, Italy, Portugal, France, Denmark

FENICs Female Employment and Family Formation in National Institutional Contexts Problems with ECHP Analysis Mothers identified by reference to children living in household – no direct questions on fertility Measure of potential labour market experience not actual labour market experience Cross sectional estimates do not control for unobserved heterogeneity Cannot observe long term effects

FENICs Female Employment and Family Formation in National Institutional Contexts Detailing the German and British Cases: Cross Sectional Estimates Base: women with no childrenUKGermany OLSHeckOLSHeck* Young mum and 1 child *-0.20* Young mum and 2 children-0.12*-0.13*-0.22*-0.24* Young mum and 3 children-0.18*-0.19*-0.18*-0.20 Older mum and 1 child *-0.09*-0.11* Older mum and 2 children-0.13*-0.15*-0.12*-0.14* Older mum and 3 children

FENICs Female Employment and Family Formation in National Institutional Contexts Detailing the German and British Cases: Models of Earnings Growth UKGermany Additional Children-0.13*-0.14* None then some * Some and no more0.25*-0.05 Some then more * Had child no break * Had child with break *

FENICs Female Employment and Family Formation in National Institutional Contexts Detailing the German and British Cases: Unobserved Heterogeneity UKGermany OLSFirst DiffOLSFirst Diff 0 to * to to to 10.21*0.35* to * to * to 20.22*0.31* to to 30.24*0.33*

FENICs Female Employment and Family Formation in National Institutional Contexts Interpreting the family gap within the institutional context Country differences do not relate to broad typologies Similar size gaps can have different explanations (e.g. Germany and the UK) Belgium, Italy, France and Denmark are not shown to exhibit family gaps in pay. Childcare? Small family gaps may be representative of regimes where alternative preferences cannot be realised