How Parenthood Affects Women and Men’s Salaries and Careers Differently [Call Summary]
Below is a recording and transcript of our expert call with Steven Huang, Head of Diversity & Inclusion and Culture Amp.
TRANSCRIPT:[Starting after Steven’s intro, 34:50 or 2:53]
W2: To start out, let’s talk about one specific stat before we dive into all of the many ways the numbers can take us here. Most people on the call are well aware that the gender pay gap is a hot topic right now – and rightly so. The general data and anecdotal and qualitative data do suggest that things are moving in the right direction, albeit a little slow. But we talked about a somewhat alarming statistic around the gap specifically related to becoming a parent is actually widening right now. Can we talk about that?
Steven: One thing that often comes up in the gender pay gap discussion is that the gender pay gap is closing. We started researching this stuff in the late 1970s, and what we found was that the earning difference between women and men is closing – in 1980 women were earning 60 cents to the dollar from men, and now we’re finding that it’s closer to about 80 cents to the dollar for men. So it’s closing, we’re making progress in the overall sense.
But one thing we know about diversity and inclusion is that everything is nuanced. We’ve kind of plateaued at that 80 cents to the dollar and we haven’t been able to make the same kind of progress. This line of research is showing how nuanced it is.
Now we’re looking at specific factors. For women who’ve never been married and never had kids, they’re actually making 96 cents to the dollar from men who’ve also never been married or had kids at the same age and socioeconomic status. So the “never married” part is really closing.
What we find is that women who are married, who have kids and tend to be over 35, that pay gap is widening. So they’re actually only at 75 or 76 cents to the dollar for every dollar that men make. It’s not quite evenly distributed.
W2: And you’d say that the data would suggest that that’s at least in some part attributed to becoming a parent?
Steven: Yes. What happens when women reach the age of 35 – why is 35 that marker? What we know is that women tend to have kids right around that age, or right before or slightly after. That’s why researchers homed in on that number. If we’re not making progress with women in that age group, maybe that has something to do with parenthood.
Women who are raising young children, they have the hardest time because, even though men are taking more of the share of domestic responsibilities, women are still taking the lion’s share of those responsibilities.
W2: That’s a good segue into a larger discussion around some of the other stats that are in this story. First and foremost, the gap when we reach parenthood is actually raising. Let’s get into some of the meat in here. What are some of the top stats that everyone should know in this areas?
Steven: Yup, I’ll give you two statistics.
The first is that fatherhood, becoming a father, increases a man’s wages by about 6%. And becoming a mother decreases a woman’s earnings by about 4% per child.
W2: Wow, ok so not only does becoming a parent actually have a positive affect to becoming a father…let’s talk about that, what’s behind that?
Steven: Fatherhood serves as a signal for potential employers for greater maturity, commitment and stability. In the context of how your employer expectations for the “family man”, research, both qualitative and quantitative, shows that when a man becomes a father, there’s less scrutiny for poor performance, and there are more opportunities to demonstrate capabilities than a man without children.
I’ve heard an anecdote from an old manager of mine – he has kids now – but when the business was starting to not do well, even though he wasn’t a father, some of the other men on the team were, so he was told they were letting go of him first, for that reason.
So becoming a father signals better performance, more maturity and less scrutiny for poor performance.
W2: And do you – it’s ok if there’s not too much clarity around this – but is there any evidence that points towards a willingness to accommodate fathers as they become parents? I think everyone on the phone call can agree that many fathers are taking steps towards sharing responsibilities of childcare, there’s still a large gap there still. Is there anything about employers almost being a little more willing to support the parenting side of some of their fathers, or is there not much data?
Steven: I don’t have the data at my fingertips, but I’m pretty sure it’s there. And I’m always hearing things. When my CEO, who’s a male, says “I’m going to stay home and take care of the kids,” he gets an applause. But his reaction is “I’m just doing the same thing that my wife, who’s just as accomplished as I am. Why am I getting special ovations for just doing the work that should be shared in general?”
That’s just an anecdote, but we talk about “working mothers”, but do we talk about “working fathers”? When we start to examine the language and stereotypes, those are engrained in us.
W2: Very interesting, yes. Ok, you mentioned there was another nice stat – or not so nice stat – that you thought was important to bring up here.
Steven: Yeah, and what we find is that motherhood decreases earnings by 4% per child, looking overall.
W2: Ok, and where does that come from, on a per child basis? It doesn’t even happen once, it happens multiple times.
Steven: Yes. So when you think about coming a father, it only affects you once because you’re either a father or not. The motherhood statistics are per child.
It’s widely documented that women experience a wage penalty for motherhood. There are tons of explanations for this. There are some human capital explanations that can be reasoned. Some women stay at home to care for their child, that interrupts their job experience, or at least their full time job experience. That can lead to lower wages.
Mothers may trade higher wages for a “mother-friendly” job that are easier to combine with parenting. Mothers may earn less because the needs of their children make them tired at work.
But really, all of the explanation is because employers discriminate against mothers, by assuming there’s going to be a lower work commitment, or lower performance. And some people make a selection argument that women are less likely to earn higher wages because they’re more likely to become mothers, but that’s debatable.
W2: Interesting. And I can see this anecdotally too. I’m thinking about the conversation a mother has with her employer when they’re going to have a child versus the conversation a father may have with his employer is very different. The mother is talking about literally nine months of a physical situation and then actual maternity leave, time out of the office after that, which is, as most people understand, is not something that is in the majority for what fathers take or are even provided. So it’s two very different conversations. Again, it seems almost for a father might be what you just mentioned – Yay, good job! – a very different thing for mothers. And if you need to have that three times in a row over the course of six years, that makes a little bit of sense. Interesting.
Steve: Childhood is often seen as an instability for mothers, which is completely unfair. Another part of the reason why wages go down, some women, because of the high costs of daycare, it makes sense to just take time off and quit their job. But that’s really where intersectionality comes into play, and we can talk about that.
W2: Let’s do that.
Steven: Alright. One thing we start to look at once we see all of these factors, we’re seeing that the fatherhood bonus and the motherhood penalty are not evenly distributed.
Let’s talk about fathers first. We said that becoming a father increases your earnings by 6%. But if you’re a white father, a college educated father, or if you’re in a professional job with a higher occupational economies of demand, your fatherhood bonus is higher than if you’re Black, Latino or don’t have a college degree.
So essentially what we’re finding is that men who are better-positioned or more highly-valued due to their race are getting a larger bonus for fatherhood.
W2: Interesting, and what do you think some of the reasoning is for those numbers? Any ideas?
Steven: Systemic bias. And that’s what we see in the motherhood penalty as well. For mothers we saw that it decreases your wages by about 4% per child, but if you’re a mother that’s in the top income quartile, you have more resources available, you may be able to hire a nanny, maybe your spouse is willing to take on more of the work, maybe you have family close by who can help with child care, maybe your employer is more willing to support parenthood. So if you’re in the top quartile, you actually don’t have a motherhood penalty. You motherhood penalty is 0%.
But if you’re a poor mother, one in the lower income quartile, your penalty is 10% per child. That’s because if you have a lower paying job, it does make sense to just quit completely because of the high cost of child care. Maybe your company is not as supportive, you’re in a lower wage job. There are all sorts of reasons why, if you’re in the lower quartile, that motherhood penalty is much deeper.
So sadly, the women who can least afford to pay, pay the largest penalty for motherhood.
W2: Ok, we’ll hit what employers can think about this in a minute. But thinking to when we were going over stats to prep for this call, one of the quandaries that you brought up was that some of the reasons for this motherhood penalty have been identified, I believe you said one-third. But there’s a large portion that really doesn’t have a solid explanation. Why is that, and do you think there’s anything we can do about it, are there people working through this problem?
Steven: Ok, this is a big one. Let me stall while I think through this. One-third of the penalty we can “explain” – I’m using air quotes – using a regression model, so one-third we explain through the lost work experience. And with that lost work experience you might miss a promotion, you’re working less or accept lower earnings, or you miss work to care for your child. Those things are lost capital because of a child.
But two-thirds of the numbers is unexplained, unexplained in the data. What we’re going to guess is things like employer discriminating against mothers who are actively looking for jobs. If an employer can see that, she’s talking about having a kid, that affects hiring decisions, promotion decisions – you’re going to have to leave work early to pick up your kids.
And there are just stereotypical gendered expectations that manifest in all sorts of ways. A lot of companies are approaching this with policy, and they’re approaching this with policy changes.
But if we’re not approaching this with intersectionality in mind – and I don’t think a lot are – I’m not exactly sure how we’re going to get to the root of this problem.
W2: I’m hearing you say that the two-thirds is really clearly than that number might suggest is that a lot of us doing this work probably have anecdotal evidence, qualitative evidence, some repeat situations and reports that are happening. For example, you mentioned the pretty well-reported incident of going into a job offer and having pregnancy come up – which is illegal, but still happens – or being pregnant in your existing job, or being in a job and becoming pregnant and not being open to opportunity, or worse case, being let go or something like that. So a lot of explanation could be, once we can get to a point where we can measure it, a lot of what we can intuit we could put numbers to it. Is that the situation?
Steven: Yeah, that’s exactly right.
W2: I always like to remind people that in some instances, if it’s pretty clear that certain things are happening, it doesn’t necessarily warrant having to get really concrete data around some of it. Urging people, especially if it’s inside your workplace and it’s visible, that’s enough to act on. I’ll add that some of these siloed topics that could be bucketed into this two-thirds “I don’t know,” in silos, they’re being researched. Probably going to be a long time before they come together in a nice little picture but…
Steven: Yeah, it usually takes about five years, to be researched, get published, get cited. Intersectionality has been a big topic the last several years, and I’m still waiting for intersectional research to hit the high-impact journals so I can read up on this stuff.
W2: And I do also know that some corporations have taken this under. Only make the distinction because they don’t often hit the journals, but do have sound research, and usually come out a little quicker.
We do have one question about understanding the relationship that could happen if the mother is the primary breadwinner, and we’d have to make the assumption that the employer knows that, and the father is the primary caregiver, or at least not the primary breadwinner, is there any data in terms of breadwinners, and whether those roles might be switched?
Steven: They covered some of that in the research, but they were trying to get away the excuses that men make. So if the fathers have female partners who don’t work or work part time, these partners might take more of the responsibilities, freeing up the fathers to take on employment. but when the studies include mothers as equal time partners in the model, it doesn’t change. So the fatherhood bonuses are regardless of the mother’s work hours.
They were saying maybe the men were more likely to get a bonus because they were already high wage earners, and were more likely to defend their privilege.
W2: A whole topic of conversation around defense of privilege, but we’ll leave that for another day! Let’s take a couple minutes and talk about, on the employer side, what are some things that employers can think about if they want to tackle this problem, based on this data or not.
Steven: This is where I’d love to hear from others too. I work at a company that’s about 400 people. What I’ve been encouraging people to do, when I talk about socioeconomic status with my workforce, I get more people to the table. If you’re just focusing on women or just on race and ethnicity, I find that white men don’t think they need to play the part, but both feel they have a part in socioeconomic conversations. So I like to start by just talking about this. I’ve had lots of white men saying “thanks for bringing this up. I grew up poor, and I have privilege as a white man, but not some of the economic privilege that other people have.” So leading with that seems to bring more people to the table. This isn’t just about women, it’s about poor women. It isn’t just about fathers, it’s about Black fathers and Latino fathers. Then we can start talking about people who are trans and face that stigma, or people with disabilities. It’s not just black or white. Socioeconomic offers an entirely different lens, even those not affected by it, include majority and minority groups.
W2: Great. You mentioned policy, which is touched on in discussion, but still a widely underutilized way to tackle a lot of these issues. What’s the importance of policy? Especially parental leave, are there any other policies.
Steven: I’m sure there are, but policy isn’t my strong suit. We talk about emotions and coming together, but policy is equally as important.
W2: Because I asked the question, I’ll throw a few things out. Certainly parental leave policy is important, but a lot of smaller policies – maybe baked into perks – on how to best support parents in the work place. That’s of course different for different types of parents.
One topic that’s being talked about a lot in parallel is flexible work options. It’s not possible in all workplaces, but if it is, that’s also a policy that can be a huge benefit to working parents and being able to support. Everyone walks into the workplace as a parent (the ones who are parents) and it’s not something they can sort of discard during the day. Those are just two I’ll throw out there.
One question: curious if there are any differences in the umbers when it comes to size of company, large or small. Anything?
Steven: Oh, I don’t. Interesting, I couldn’t even take a guess. Sometimes I might think a larger company has more protections and policies, and flexible work might be easier with better coverage, but now I’m thinking I don’t know!
W2: I don’t have numbers either, but could offer a couple of things to think about. You just mentioned more formalized policies, but they may have more baked in unconscious biases, or policies that aren’t supporting the system like hiring processes. Or at the end of the day more people and managers and teams to check on and to quality control.
But at the same time with smaller companies, you might be more flexible, you might be more open in conversations with these things, but you don’t always have robust policies around things like benefits, especially when you get into the startup space, you have fewer dollars to support a lot of these things. When you have a small company mindset, and you have to work through things like diversity of team, the mindset isn’t guaranteed. That’d be really interesting for someone to dive into!
Another question from Jennifer, she’s wondering how to set expectations with managers and train them to avoid falling into biases around fatherhood bonus and motherhood penalty, or any suggestions of resources.
Steven: The way I approach this, and diversity and inclusion in general, is to build it into your existing training calendar. The reason is that I like training to be opt in, but that’s debatable. I like people to discover what their own biases are for themselves. If there’s existing employee training happening already, I like to embed diversity and inclusion training into those existing programs. There are a lot of resources online. General advice is embed it into something they’re used to and are looking forward to.
W2: Love that. We have really high-level processes that we take when we’re working with companies around anything in this realm is awareness. Making sure that this situation is made to be aware that it can happen in the first place. It’s well-cited that you present these things in a non-accusatory, general information standpoint.
More generally – Steven you’ll appreciate this because you’re an opt in person – there was some recent research that came out about how diversity training is largely ineffectual. The reason for that is the way that people implement it. It’s not that it can’t be beneficial, but 75% of diversity training isn’t working. Two of the reasons cited are 1) if it mentioned legal anything (certainly in this conversations!) and 2) if it’s made mandatory. So that makes about 75% of any diversity and inclusion training ineffectual.
Thank you Steven!