following lives from birth and through the adult years www.cls.ioe.ac.uk

Jenny Neuburger

GeNet meeting, 26 September 2008

Trends in the Relative Pay of Women and Men Across Three British Birth Cohorts

following lives from birth and through the adult years www.cls.ioe.ac.uk

Research questions

How has women’s average pay changed relative to men’s since 1970?

How does women’s average pay change with age, relative to men’s?

What difference does it make adjusting for changes in women's employment participation?

Censuses (1951, 1961, 1966) Labour Force Survey, 1971-2007

Increases in women’s paid employment

New Earnings Survey 1970-1997, ASHE 1998-2007

Improvement in (employed) women’s relative pay

British Birth Cohort Studies National Survey of Health and Development (NSHD) - All babies born in England, Scotland and Wales in one week

of March 1946. - Follow-up survey 5,362 in 1948. Stratified sample. - Surveyed 22 times, most recently in 2006 (age 60).

National Child Development Study (NCDS) - All (17,634) babies born across Britain in a week of March

1958. - Seven follow-up studies. Added Non British-born children at

ages seven and eleven. - 11,419 interviewed in 2000 (age 42).

British Cohort Study (BCS) - All (17,287) babies born across Britain in a week of April 1970.

- Seven follow-up studies. Non British-born added at ages five,

ten and sixteen. - Non-response problems. 9,665 interviewed in 2004 (age 34).

% of women in paid employment, by age & cohort

following lives from birth and through the adult years www.cls.ioe.ac.uk

Ratio of women’s to men’s mean hourly pay, by cohort & age

Truncated distribution of wage offers

In paid work

Not in paid work

Wage offer

Mean wage

Mean wage offer

Imputation characteristics

Childhood Father’s occupation at two ages Mother’s age when cohort member born Parents’ education Scores in maths and reading tests at age 10 or 11 Number of siblings Number of older siblings

Adulthood Highest qualifications Occupational status of first job Years in full-time and part-time employment Any children, children under five, more than one child Lives in London or the South East

Results I: Who is in employment?

Women with higher education and ability more likely to be in paid work (and to work full-time)

Differences reduce with age. Non-employees more heterogeneous group at older ages.

Results II: What do imputed wage distributions look like?

Imputed mean wage is lower than mean wage for women in six out of the seven surveys (between two and eight per cent lower)

Full-time mean is much lower for women (up to 15 per cent) when part-timers and non-employees assigned full-time wage

Mean is lower for men at two ages; 33 (1991) and 42 (2000) for NCDS

following lives from birth and through the adult years www.cls.ioe.ac.uk

Imputed and actual log wage distributions, NSHD

NSHD women age 26 NSHD women age 31

Results III: Trends in actual and potential pay ratios

following lives from birth and through the adult years www.cls.ioe.ac.uk

Conclusions

Women’s average actual and potential pay has increased relative to men’s across cohorts, but decreases with age

We underestimate cross-cohort improvements in young women’s potential pay if we ignore selection into employment

Gender pay gaps for full-time workers understate gender inequality in full-time pay opportunities

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following lives from birth and through the adult years www.cls.ioe.ac.uk

Sample sizes

NSHD 26 (1972)

NSHD31 (1977)

NCDS23(1981)

NCDS33(1991)

NCDS 42(2000)

BCS 30(2000)

BCS 34(2004)

Employed 835 774 3921 3599 4135 3990 3426

Observed wage 739 630 3655 3188 3713 3655 3006

Wage missing 96 144 266 411 422 335 420

Missing covariates (255) (267) (1640) (1573) (1764) (1364) (1106)

Not employed 1017 875 2334 2185 1641 1781 1582

Imputed 681 586 1119 1187 857 1061 992

Not imputed 11 5 39 5 5 5 0

Missing covariates (322) (284) (1074) (993) (776) (713) (586)

Total in survey 1852 1649 6255 5784 5776 5771 5008

2547 2547 8959 8959 8959 7877 7877

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% of women with children, by qual, age and cohort

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% of women with children, by qual, age and cohort

following lives from birth and through the adult years www.cls.ioe.ac.uk

% mums employed when child < 5 yrs, by qual & cohort

following lives from birth and through the adult years www.cls.ioe.ac.uk

Nearest-neighbour matching based on propensity score

Prob(work) = 1

Prob(work) = 0

Not in paid work

In paid work Propensity score

following lives from birth and through the adult years www.cls.ioe.ac.uk

Imputed potential and actual mean wages

NSHD 26 (1972)

NSHD31 (1977)

NCDS23(1981)

NCDS33(1991)

NCDS 42(2000)

BCS 30(2000)

BCS 34(2004)

Women

Imputed mean 1.28 (0.02)

1.40 (0.01)

1.49 (0.01)

1.77 (0.01)

1.90 (0.01)

1.92 (0.01)

2.09 (0.01)

Mean wage 1.40 (0.01)

1.43 (0.01)

1.52 (0.01)

1.83 (0.01)

1.91 (0.01)

1.96 (0.01)

2.13 (0.01)

Employees 809 724 3792 3413 3949 3874 3271

Imputed sample 1490 1310 4911 4600 4806 4935 4263

Men

Imputed mean 1.78 (0.01)

1.87 (0.01)

1.68 (0.01)

2.19 (0.01)

2.35 (0.01)

2.15 (0.01)

2.36 (0.01)

Mean wage 1.78 (0.01)

1.87 (0.01)

1.68 (0.01)

2.20 (0.01)

2.36 (0.01)

2.16 (0.01)

2.37 (0.01)

Employees 1568 1305 4586 3961 3952 4158 3488

Imputed sample 1735 1484 5218 4676 4763 4829 4124