Career Interruptions and Current Earnings: The Role of Interruption Type, Compensation Component, and Gender

28 Pages Posted: 1 May 2017

See all articles by Benedikt Gerst

Benedikt Gerst

RWTH Aachen University

Christian Grund

RWTH Aachen University - School of Economics and Business Administration; IZA Institute of Labor Economics

Abstract

This study examines how career interruptions and subsequent wages of employees are related. Using individual panel data of middle managers from the German chemical sector, we are able to differentiate between different reasons for interruptions as well as between various compensation components. We show that career interruptions are more related to lower subsequent bonus payments than they are to fixed salaries and that interruptions caused by unemployment are associated with higher interruption pay gaps than those resulting from other reasons. In addition, the pay gap after career interruptions is more pronounced for male employees than it is for females.

Keywords: career interruptions, gender pay gap, stigma effects, bonus payments, fixed salaries, total compensation

JEL Classification: M52, J31, J33, J71

Suggested Citation

Gerst, Benedikt and Grund, Christian, Career Interruptions and Current Earnings: The Role of Interruption Type, Compensation Component, and Gender. IZA Discussion Paper No. 10713. Available at SSRN: https://ssrn.com/abstract=2960522

Benedikt Gerst (Contact Author)

RWTH Aachen University

Templergraben 55
52056 Aachen, 52056
Germany

Christian Grund

RWTH Aachen University - School of Economics and Business Administration ( email )

Aachen
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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