Sarah Green Carmichael: Motherhood shouldn't stifle women's income

Sarah Green Carmichael, Bloomberg Opinion on

Published in Business News

American mothers typically earn less than childless women, while fathers earn just as much as childless men. The “motherhood penalty” has been documented for years, and it’s the primary reason for the overall gender gap in earnings between men and women. But a just-published study throws open new questions about why it exists — and why it’s been so hard to eradicate.

The earnings discrepancy creates a problem for moms and their families. Children put extra financial pressure on a household, and the motherhood penalty makes it harder for women to help their families meet those needs. Moreover, the hit to earnings leaves women vulnerable should their partner’s income disappear.

Previous research has suggested that mothers might earn less because they switch to smaller or lower-paying firms that offer more flexible schedules. Other scholars have suggested that households are making a rational decision to prioritize the higher-earning partner’s career — and that in opposite-sex partnerships, the higher-earning parent tends to be the father.

But the new study, by economists Douglas Almond and Yi Cheng of Columbia University and Cecilia Machado of Brazil’s FGV EPGE School of Economics and Finance, suggests that’s not what’s happening.

Drawn from two decades of data from 1990 through 2010 for more than 800,000 parents, the study first confirms what so much other research has shown: The birth of a first child doesn’t meaningfully affect men’s earnings but leads to a substantial drop in women’s earnings. On average, mothers lose about $2,000 a quarter — $8,000 a year. That amounts to a relative drop of about 51% compared with their pre-child earnings.

That drop doesn’t meaningfully change at big versus small companies; in other words, women aren’t switching to smaller or more flexible firms. Nor are couples making a calculated choice to maximize the household’s earning potential because, the researchers conclude, the motherhood penalty persists in households where the woman earns more. In fact, in households with breadwinning moms, the penalty is even larger. These women experience a drop of 60% in their pre-child earnings relative to their lower-earning male partner.


Part of the gap is because some women end up leaving the workforce, either temporarily or permanently. According to census data, in households with children younger than 6, 35% of mothers are out of the labor force — compared with just 4% of fathers.

Yet mothers who keep working also find their earnings penalized. “This indicates that the effect is not only due to women leaving the workforce, but also due to lower earnings among the employed,” Almond says.

For all mothers, the penalty is durable — it didn’t meaningfully shrink in the six years after the birth of a first child and in fact even grew a little bit over that time. The penalty is also depressingly hard to escape. It persists among the college-educated regardless of whether the boss is a woman and regardless of whether the company has a predominantly female employee base.

The die is cast when the baby is born. “The benefits of childbearing accrue to both parents,” the economists write, but “the burden of childbearing comes at the expense of women’s labor market outcomes.”


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