The Parenthood Pay Gap: Why Having Children Costs Women More Than Men

While the wage gap between working men and women has shown signs of improvement over the years, a new study finds that for women, having children can mean taking a pay cut.

UMass Amherst sociology professor Michelle Budig's research shows that women on the low end of the earnings spectrum are particularly vulnerable to this "wage penalty," even while men often stand to benefit from what she calls the "fatherhood bonus."

Budig joined WBUR's Morning Edition to discuss her findings.

Michelle Budig: The motherhood wage penalty on average is about 4 percent per child, so a woman with two children would get on average an 8 percent penalty. And that doesn't maybe sound like a lot, but if we think about it in terms of current dollars for a median earner, a woman, it would be about $1,787 per child. And that's yearly, so if you accumulate over the life that's quite a lot of money.

Bob Oakes: As I understand it, you found that moms in lower income brackets were particularly hard hit. Why was that and what are the consequences of that in the big picture?

Yes, we find that the wage penalty for motherhood is worse for women at the median or below compared to higher earners. One of the reasons we think it might be true is that childcare is harder to put together on low earnings. So women with lower earnings have a hard time with reliable childcare and often will quit their jobs if a family crisis arises. Whereas women with very high earnings, you know like at the 90th percentile of women earners, actually receive a motherhood bonus.

Why is that?

We're not sure. We tried a number of different models where we looked at husband's work hours, thinking that really high earning women might have men who are more apt to stay at home and care for kids, and we didn't see that that mattered.

We think perhaps motherhood, if you're already earning that high of a wage, spurs women on to replace their care of children with nannies or other services which are pretty costly, maybe motivates women to earn even more.

One of the interesting findings is that once families have kids the mothers are penalized but the fathers are rewarded dollar wise for children.

What we find is the status of being a father is linked to a wage bonus for men. And the wage bonus for men is about 6 percent, and it increases depending on a number of other factors such as race, education and kinds of jobs.

Why do fathers get a bonus?

Well there's a few conventional explanations. When men become fathers, they work harder. So we do include in our models work hours, but we see that the inclusion of work hours or job changes only includes about 16 percent of the total fatherhood bonus.

Another explanation is that men who have higher earnings potential become dads. But we actually find negative selection — so men with characteristics that predict lower earnings become dads. So through a lot of process of elimination we think there must be something happening in the work place such as pro-discrimination for fathers, increasing their wages.

And why are mothers penalized? Because employers think they'll be distracted by their kids?

Yea, it must be because employers think that women are more distractable once they have kids or less committed workers. Although we've done a lot statistical models including measures of work effort, and we can't see any evidence that that is actually true.

Alright, bigger picture question to close out. The research group Third Way published your study. They're focused on producing public policy recommendations. So what recommendations do you have coming out of this study to mitigate this motherhood penalty and get closer to true equality wage-wise?

One thing I think we know is that because the motherhood penalty is worse for low earners and the fatherhood bonus is less for that group, that we need to support the wages of parents at the lower earning spectrum, so we advocate for the earned income tax credit to be greater.

Also from cross-national studies I've been doing, we find that publicly-funded childcare for the smallest children, ages zero to 2, is strongly associated with smaller motherhood penalties, so is paid parental leave available to both men and women.