Why Did Gender Wage Convergence in the United States Stall?

Abstract

Women entering the workforce en masse is one of the most important developments in the U.S. labor market during the past century. While female labor force participation increased following World War II, the gender wage gap held steady at 40 percent. The 1980s, however, marked a time of steady gains for women: the gender wage gap closed by roughly 10 percentage points. Then in the 1990s and beyond, gender wage convergence again stalled. The ratio of women’s to men’s earnings increased by a mere 2 percentage points in the 20 years between 1990 and 2010. While the reasons for gender wage convergence during the 1980s—including declining unionization, a reduction in gender discrimination, and reduced gender gaps in education, labor market experience, and occupational sorting—are well‐​understood, the pattern of stagnant wage gains for women in the 1990s is less understood. Our work shows that the introduction of state and federal family‐​leave policies can explain why gender wage convergence in the United States stalled.