Heterogeneity in gender wage growth gap across fields of study in Europe

This paper analyzes the early career dynamics of wages of European college graduates using data from the Flexible Professional in the Knowledge Society, a retrospective survey interviewing individuals a few years after their graduation in 1999/2000. The sample includes individuals from Austria, Belgium, Finland, France, Germany, Italy, Netherlands, Spain, UK, Portugal and Norway. The paper finds a gender gap of 0.7 percentage points on an average annual raw wage growth over the five-year period after graduation of 6 1/2%.

Portugal presents the lowest average wage growth, 3.3%, and the highest gender gap of 2.2 percentage points.

Controlling for differences in subfield of study, occupation and industry, there is an overall significant female penalty of 1.0 percentage points in wage growth among those who became parents, but insignificant for those who remained childless. Heterogeneity across fields of study is striking (see figure). Only within the Economics, Business and Law category the gender gap is significant. In this field, women who became mothers during the period of analysis exhibit a wage growth penalty of 2.5 percentage points with respect to men who became fathers, more than double the female wage growth penalty of 1.1 percentage points found among childless individuals. Variables capturing individual differences in job mobility and human capital play a modest role in accounting for gender differences in wage growth. Finally, including the individual self-reported ability to negotiate as a control variable left the estimated gender gap unchanged.

These findings are in line with Bütikofer et al. (2018), who find that the child earnings penalty for mothers is larger among MBAs and lawyers than among STEM and Medicine graduates in Norway, and in line with the evidence reported in Goldin (2014) for the case of the US.

Click here to go to the paper by Rocío Sánchez-Mangas and Virginia Sánchez-Marcos.