Understanding the Gender Earnings Gap: Hours Worked, Occupational Sorting, and Labor Market Experience

32 Pages Posted: 14 May 2021

See all articles by Maria E. Canon

Maria E. Canon

Federal Reserve Banks - Federal Reserve Bank of St. Louis

Limor Golan

Washington University in St. Louis

Cody A. Smith

Washington University in St. Louis

Date Written: April, 2021

Abstract

This article documents life-cycle gender differences in labor market outcomes using longitudinal data of a cohort of individuals from the National Longitudinal Survey of Youth 1979. As in other datasets, the gender earnings gap increases with age. We find that hours worked and labor market experience are the most substantial observable variables in explaining the gender pay gap. We also focus on patterns in occupational changes over the life cycle, as a large part of pay growth occurs when workers change jobs. We find that college-educated men, on average, move into occupations with higher task complexity. We further show that women are less likely to change occupations. Moreover, on average, pay grows when workers change occupations, but the growth is smaller for women. Finally, we discuss theories that are consistent with the patterns we document.

JEL Classification: J16, J24, J31

Suggested Citation

Canon, Maria E. and Golan, Limor and Smith, Cody A., Understanding the Gender Earnings Gap: Hours Worked, Occupational Sorting, and Labor Market Experience (April, 2021). FRB of St. Louis Review, Available at SSRN: https://ssrn.com/abstract=3843845 or http://dx.doi.org/10.20955/r.103.175-205

Maria E. Canon (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of St. Louis ( email )

411 Locust St
Saint Louis, MO 63011
United States

Limor Golan

Washington University in St. Louis

One Brookings Drive
Campus Box 1208
Saint Louis, MO 63130-4899
United States

Cody A. Smith

Washington University in St. Louis ( email )

One Brookings Drive
Campus Box 1208
Saint Louis, MO MO 63130-4899
United States

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