econlife - More on the Mom Penalty by Elaine Schwartz

During February, we had lots to say about the mommy penalty. Now there is more.

Our first stop is a cartoon and then a study from Denmark.

The Cartoon

In “You Should’ve Asked,” French cartoonist Emma perfectly sums up the mommy penalty in two words: Mental Load.

Emma tells us that, “When a man expects his partner to ask him to do things, he’s viewing her as the manager of household chores…So it’s up to her to know what needs to be done and when…” And to cope with home as her second full-time job.

This is a brief excerpt from a much longer (phenomenal) cartoon:

The Denmark Study

To remember the quantitative side of the mental load, just think, “20%.” From 1980 to 2013, the long run gender pay gap averaged close to 20%.

Who

Although the data is from Denmark, it is not just about them. Initially, the Scandinavian countries did have less of a gender pay gap. Then though, their progress slowed, others accelerated, and all of us are close to the same spot now.

Below, the convergence is evident:

Why

Asking why that gap continues, the authors of this study say it is the children. Women switch to more family friendly firms and jobs. They work for fewer hours. Their pay dives– initially down close to 30%. Meanwhile for men, no change.

You can see the drop for women right after a first child was born. Even 20 years later, it never bounced back:

Furthermore, this study’s authors emphatically believe that we have causation here, not correlation.

Our Bottom Line:  Human Capital

Because we are also talking about raising children, we can ask if it’s good or bad for them that women are drawn to the home.

If you support the “good” side, then comparative advantage comes into play. Thinking traditionally, you believe that women are more suited to childrearing.  Consequently, they should be doing more of it and accept the opportunity cost.

On the other hand, blaming outdated social norms, you could believe that moms who work should not be tethered to the home. The data below is from 2002 but might still prevail:

Whichever, your side, we can all agree that most women have more of a mental load in the home than their partners.

My sources and more: If you go to just one link after econlife, do see the entire cartoon. But if you do continue to the academic side, this paper is a possibility.

Ideal for the classroom, econlife.com reflects Elaine Schwartz’s work as a teacher and a writer. As a teacher at the Kent Place School in Summit, NJ, she’s been an Endowed Chair in Economics and chaired the history department. She’s developed curricula, was a featured teacher in the Annenberg/CPB video project “The Economics Classroom,” and has written several books including Econ 101 ½ (Avon Books/Harper Collins). You can get econlife on a daily basis! Head to econlife.

econlife - The Mom Penalty and the Dad Bonus by Elaine Schwartz

Elon Musk has five sons. In 2013, when asked about his time with them, he said, “What I find is I’m able to be with them and still be on email. I can be with them and still be working at the same time…If I didn’t, I wouldn’t be able to get my job done.”

Would most women have said the same thing?

The Mom Penalty

In 1979, women typically earned 63 cents for every dollar that men made. By 2003, the gap had shrunk to 81 cents for each dollar. In 2010, we even had ABC  News announcing that women earned 8% more than men if they were unmarried, under 30 and living in a urban area.

But that subset is small.

You can see below that other categories of women who are comparable to men in every other way get paid less:


The 4% Plunge

The number to remember is 4%. A mom’s wages plunge 4% per child. But it gets even worse because your affluence counts. For the top 10%, the motherhood penalty pretty much disappears. However, with the lower wage earner, it is 6%.

Hypothesizing why, we can cite a list of reasons.

Women could earn less because they…

• Spend more time at home to be with children.
• Select lower paid mom-friendly jobs.
• Have less energy and more distractions at work because of children.
• Experience employer discrimination.

The Dad Bonus

Meanwhile, men benefit from being fathers, especially those at the top. The reason could be that fatherhood implies stability, a wife to take over your responsibilities, and the need for a greater work commitment. For married (or even unmarried) white college-educated men. the daddy bonus can be as much as 8%. But lower wage earners benefit much less.

The fatherhood wage bonus:

Our Bottom Line: Confirmation Bias

A behavioral economist could say that the mom penalty and dad bonus are all about confirmation bias. Because employers expected children to affect the job done by women, they paid them less. Consequently they were reinforcing and perpetuating social norms that constrained women’s careers.

So yes, Elon Musk might be disparaged less for working when with his children than a mom. And, as a white highly educated dad, he has the biggest boost from the fatherhood bonus.

My sources and more: Recently, articles about professional women and children are everywhere. WSJ spoke about female innovators and the NY Times, about the economics profession (as did econlife). Meanwhile, these recent papers, here and here, and summaries of studies, refer to the motherhood penalty. And BusinessInsider had the Elon Musk fatherhood quote.

Ideal for the classroom, econlife.com reflects Elaine Schwartz’s work as a teacher and a writer. As a teacher at the Kent Place School in Summit, NJ, she’s been an Endowed Chair in Economics and chaired the history department. She’s developed curricula, was a featured teacher in the Annenberg/CPB video project “The Economics Classroom,” and has written several books including Econ 101 ½ (Avon Books/Harper Collins). You can get econlife on a daily basis! Head to econlife.

econlife - What Not To Tell During a Job Interview by Elaine Schwartz

Assume that a new employee in a similar position will be earning more than you. Your attempt to get a raise does not work so you look for a new job. In most states, you could have a problem.

Only California, Delaware, and NYC have implemented a salary question ban that covers all public and private employees:

 

Why?

During a job interview, it is tough to dodge the salary question. If someone asks what you earned in a previous job, you could answer with a targeted salary range. But the dialogue could get uncomfortable, especially with unfair pay.

And that takes us to women and the gender pay gap. The media tell us that women earn 79 cents for every dollar that men are paid. Although the real gap is much more complicated, for today, let’s stick with that number.

At a new job, you could narrow the gap by starting on a higher rung of the wage ladder. However, your previous salary could diminish a pay offer. To eliminate the influence of your wage history, laws are multiplying that prohibit the salary question during job interviews.

You can see below where laws banning the salary question have been passed and proposed. Since the graphic was created, Delaware and Oregon passed legislation. The Delaware law kicked in last month while Oregon’s will not be in effect until January, 2019.

 

Our Bottom Line: The Anchoring Effect

In Thinking Fast and Slow, Nobel laureate Daniel Kahneman discusses a supermarket sign that limited soup purchases to 12 cans. When the sign was up, shoppers bought more soup than when there was no cap. Similarly, when asked how long Mahatma Gandhi lived, the question made a difference. Respondents offered a higher answer when they were asked, “Was Gandhi 144 years old when he died?”

The anchoring effect links soup purchases and Gandhi’s life span. As a number that influences our subsequent behavior, the anchoring effect can justify the salary history ban. When told a lower number, a prospective employer might offer less.

My sources and more: Thanks to NPR for alerting me to the dreaded interview question. BusinessInsider was also a handy source through their states overview. But for some insight, do look at the XXfactor at Slate.

Ideal for the classroom, econlife.com reflects Elaine Schwartz's work as a teacher and a writer. As a teacher at the Kent Place School in Summit, NJ, she’s been an Endowed Chair in Economics and chaired the history department. She’s developed curricula, was a featured teacher in the Annenberg/CPB video project “The Economics Classroom,” and has written several books including Econ 101 ½ (Avon Books/Harper Collins). You can get econlife on a daily basis! Head to econlife.