The Within-Job Motherhood Wage Penalty in Norway, 1979-1996

The motherhood wage penalty is a substantial obstacle to progress in gender equality at work. Using matched emplover - emplovee data from Norway (1979-1996, N = 236,857 individuals, N = 1,027,462 individual-years), a country with public policies that promote combining family and career, we investigate (a) whether the penalty arises from differential pay by employers or from the sorting of employees on occupations and establishments and (b) changes in the penalties during a period with major changes in family policies. We find that (a) the penalty to motherhood was mostly due to sorting on occupations and occupation-establishment units (mothers and nonmothers working in the same occupation and establishment received similar pay), and (b) the wage penalties to motherhood declined substantially over the 18-year period. Key Words: family policy, gender, inequality, marriage, motherhood, wages. The movement for gender equality in the workplace has addressed equal pay for equal work, equality in hiring and promotion, and in some countries equal pay for work of equal value. By the end of the 20th century, it was widely recognized that, although major progress has been made in the first two of those three domains, significant obstacles to further progress arise today from a different source: the processes that occur in the family and their interrelationships with work. The sentiment is that "the emancipation of women has been one of the great historical events of the twentieth century," but there is an increasingly serious problem: "the extraordinary difficulties for women of combining high professional posts with being mothers' ' (Hobsbawm, 2000, p. 136). There is a sense of a serious roadblock, even a stalled revolution (Hochschild, 1989). For men, marriage and to some extent children have positive effects on wages and careers (see, e.g., Hundley, 2000). For women, however, there are no or small wage benefits for marriage, and there are large penalties for having children (see, e.g., Waldfogel, 1997). Several key questions concerning this stalled revolution arise: Did it get stalled by employers, through differential pay favoring married men and fathers and discrimination against mothers? Or was it stalled by women and men, through the choices they have made around family and work, arising both from differences in constraints and lifestyle preferences? Or was it the outcome of the interaction of discrimination from employers and gendered choices made as a result? Why are these questions important? They are important because, if the roadblocks arise at the level of employers, or fail to arise there, then there are significant public-policy implications. Employers are potentially easier to regulate than families, and gains may be made by further regulating employers. But if employers are not a culprit, an increased emphasis on family policies and changes in family culture is warranted. The question then arises as to whether family policies have had effects in settings where they have been tried on a large scale. Nowhere have family policies been more extensive than in Scandinavia. And whereas the United States led the world in the regulation of the workplace, being the first country to pass extensive equality legislation, Scandinavia is the vanguard in family policies, having rolled out major policies to reinvent the family over the past 20-30 years (Kitterad, 2002;Waldfogel, 1998). But have they worked? Have they led to one of their goals, to facilitate employment and careers for mothers? Scandinavia, including Norway, may now be the place where the revolution is unstalling. Against this background, we address several issues. The first objective is to assess the extent to which the motherhood penalty (and secondarily the marriage premium) arises from differential treatment by employers: (a) Do employers pay women differently according to motherhood (and marital) status, and (b) What is the role of sorting of employees on occupations and establishments (i. …