The gender lifetime earnings gap—exploring gendered pay from the life course perspective

Abstract

Research on the gender earnings divide so far mostly focuses on the gender gap in hourly wages, which due to its snapshot nature is unable to capture the biographical dimension of gendered pay. With the ‘gender lifetime earnings gap’ (GLEG), we introduce a new measure that fills this gap. Based on a group of 72,085 German individuals born 1950-64 from the ‘Sample of Integrated Labor Market Biographies’ (SIAB 7510), we find that at the end of the employment career, women accumulate 46.6% less earnings than men. Thus, the GLEG is more than twice as high as the current German gender pay gap. The GLEG is higher at the bottom than at the top of the earnings distribution. It most prominently widens during the period of family formation (age 25-35). Relatedly, gender differences in endowments, mainly in terms of experience and hours, account for almost two-thirds of the GLEG. For younger cohorts, family breaks tend to lose importance, whereas the role of work hours remains unchanged. Moreover, women in younger cohorts approach men with respect to employment, education and sector premiums.

Regional differences in initial labour market conditions and dynamics in lifetime income trajectories

“…For a subset of West German workers, Kunze (2005) finds a noticeable gender gap in hourly wages already present at labour market entry, and this essentially remains constant over 15 years. In contrast, the results of Boll et al (2017) point to even larger gender differences in accumulated lifetime earnings, which increase over the life course of several German cohorts. Explicitly taking into account divergent patterns of labour market attachment, this cumulative 'gender lifetime earnings gap' is up to twice as high as current cross-sectional estimates.…”

“…The use of largescale longitudinal data allows us to explore temporal dynamics in their subsequent lifetime income trajectories in detail -that is to say, how patterns of heterogeneity change or persist over different stages of life. Previous research has, for example, found time-varying associations between longitudinal income/ wage trajectories and factors such as gender (Manning and Swaffield, 2008;Boll et al, 2017;Albrecht et al, 2018), education (Tamborini et al, 2015;Bhuller et al, 2017) and parental background (Mayer, 2010). Therefore, we study heterogeneity in these relationships by gender, educational attainment and parents' socio-economic status.…”

Working mothers in East and West Germany: a cluster analysis using a three-stage approach

“…Compared to previous generations of mothers, the growing labor supply plays a major role in this context (Blau and Kahn, 2017;Kluve and Schmitz, 2018): on average, the Organization for Economic Co-operation and Development (OECD) Female Labor Force Participation (FLMP) rate is now 14% higher than in 1977, with Germany, in particular, showing an even greater increase, equating to 24% over the same time period (Mari, 2019). Higher education is, of course, another important aspect (Boll et al, 2017;O'Neill and Polachek, 1993). In the specific case of Germany, Boll and Leppin (2015) came to the conclusion that the residual wage gap is driven by factors such as employment experience, occupational position and hours worked.…”

The Gender Gap in Lifetime Earnings: The Role of Parenthood

“…Closest to our paper is the study by Boll et al (2017) analyzing the gender lifetime earnings gap in Germany. Using the administrative Sample of Integrated Labour Market Biographies (SIAB), they estimate an unadjusted gender lifetime earnings gap of 46 percent for West German birth cohorts 1950 to 1964.…”