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The Dynamics of Gender Earnings Differentials: Evidence from Establishment Data

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  • Erling Barth
  • Sari Pekkala Kerr
  • Claudia Olivetti

Abstract

Despite dramatic workforce gains by women in recent decades, a substantial gender earnings gap persists and widens over the course of men’s and women’s careers. Since there are earnings differences across establishments, a key question is the extent to which the widening of the gender pay gap over time arises from differences in career advances within the same establishment versus differential gains from job-to-job moves across establishments. Using a unique match between the 2000 Decennial Census of the United States and the Longitudinal Employer Household Dynamics (LEHD) data, we find that both channels are important and affect workers differently by education. For the college-educated the increasing gap is for the most part due to differential earnings growth within establishment. The between-establishment component explains only 27 percent of the widening of the total gender pay gap for this group. For workers without college degree, the establishment component is the main driver of the, relatively small, widening of the gender earnings gap. For both education groups, marriage plays a crucial role in the establishment component of the increasing earnings gap.

Suggested Citation

  • Erling Barth & Sari Pekkala Kerr & Claudia Olivetti, 2017. "The Dynamics of Gender Earnings Differentials: Evidence from Establishment Data," NBER Working Papers 23381, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:23381
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    Cited by:

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    2. Johnsen, Julian Vedeler & Ku, Hyejin & Salvanes, Kjell G, 2020. "Competition and Career Advancement: The Hidden Costs of Paid Leave," CEPR Discussion Papers 15157, C.E.P.R. Discussion Papers.
    3. Boll Christina & Wolf André & Rossen Anja, 2017. "The EU Gender Earnings Gap: Job Segregation and Working Time as Driving Factors," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 237(5), pages 407-452, October.
    4. Elise Coudin & Sophie Maillard & Maxime To, 2018. "Family, firms and the gender wage gap in France," IFS Working Papers W18/01, Institute for Fiscal Studies.
    5. Sarah Louise Jewell & Giovanni Razzu & Carl Singleton, 2020. "Who Works for Whom and the UK Gender Pay Gap," British Journal of Industrial Relations, London School of Economics, vol. 58(1), pages 50-81, March.
    6. Cecilia Machado & Marcelo Neri & Valdemar Pinho Neto, 2018. "The gender gap, education, and the life cycle profile in the Brazilian formal labour market," WIDER Working Paper Series wp-2018-156, World Institute for Development Economic Research (UNU-WIDER).
    7. Jiang Li & Benoit Dostie & Gäelle Simard-Duplain, 2020. "What is the Role of Firm-Specific Pay Policies on the Gender Earnings Gap in Canada?," CIRANO Working Papers 2020s-67, CIRANO.
    8. Cook, Cody & Diamond, Rebecca & Hall, Jonathan & List, John A. & Oyer, Paul, 2018. "The Gender Earnings Gap in the Gig Economy: Evidence from over a Million Rideshare Drivers," Research Papers repec:ecl:stabus:3637, Stanford University, Graduate School of Business.
    9. Albanese, Andrea & Gallo, Giovanni, 2020. "Buy flexible, pay more: The role of temporary contracts on wage inequality," Labour Economics, Elsevier, vol. 64(C).
    10. Hennig, Jan-Luca & Stadler, Balazs, 2021. "Firm-specific pay premiums and the gender wage gap in 21 European countries," VfS Annual Conference 2021 (Virtual Conference): Climate Economics 242354, Verein für Socialpolitik / German Economic Association.
    11. Elizabeth J. Casabianca & Alessia Lo Turco & Claudia Pigini, 2020. "Equal Pay for Equal Task: Assessing Heterogeneous Returns to Tasks across Genders," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 59(2), pages 197-239, April.
    12. Mary Ann Bronson, 2018. "The Lifecycle Wage Growth of Men and Women: Explaining Gender Differences in Wage Trajectories," 2018 Meeting Papers 923, Society for Economic Dynamics.
    13. Christina Boll & Malte Jahn & Andreas Lagemann, 2017. "The gender lifetime earnings gap—exploring gendered pay from the life course perspective," Journal of Income Distribution, Ad libros publications inc., vol. 25(1), pages 1-53, March.
    14. Bøler, Esther Ann & Javorcik, Beata & Ulltveit-Moe, Karen Helene, 2018. "Working across time zones: Exporters and the gender wage gap," Journal of International Economics, Elsevier, vol. 111(C), pages 122-133.
    15. Davide Cipullo, 2021. "Gender Gaps in Political Careers: Evidence from Competitive Elections," CESifo Working Paper Series 9075, CESifo.
    16. Mary Ann Bronson & Peter Skogman Thoursie, 2017. "The Lifecycle Wage Growth of Men and Women: Explaining Gender Differences in Wage Trajectories," Working Papers gueconwpa~17-17-06, Georgetown University, Department of Economics.
    17. V. Joseph Hotz & Per Johansson & Arizo Karimi, 2017. "Parenthood, Family Friendly Workplaces, and the Gender Gaps in Early Work Careers," NBER Working Papers 24173, National Bureau of Economic Research, Inc.
    18. Fuchs, Michaela & Rossen, Anja & Weyh, Antje & Wydra-Somaggio, Gabriele, 2019. "Why do women earn more than men in some regions? : Explaining regional differences in the gender pay gap in Germany," IAB-Discussion Paper 201911, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    19. Grissom, Jason A. & Timmer, Jennifer D. & Nelson, Jennifer L. & Blissett, Richard S.L., 2021. "Unequal pay for equal work? Unpacking the gender gap in principal compensation," Economics of Education Review, Elsevier, vol. 82(C).
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    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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