Skip to main content

Advertisement

SpringerLink
Log in

Millennials and the Gender Wage Gap in the U.S.: A Cross-Cohort Comparison of Young Workers Born in the 1960s and the 1980s

  • Published:
Atlantic Economic Journal Aims and scope Submit manuscript

Abstract

Using two cohorts of young workers born in the early 1960s and early 1980s, this paper analyzes the temporal change in the U.S. gender wage gap and its determinants, which persists for both explained and unexplained reasons. Results suggest that the gender wage gap closed four (seven) percentage points at the mean (median) between cohorts. It finds cross-cohort evidence that young females’ increasing returns to marriage and a changing occupational wage structure contributed to a narrowing of the gap. Nonetheless, the majority of this convergence remains unexplained due to relative improvements in unobservable institutional factors or heterogeneity for females. Compared to the previous generation, millennials likely entered a more progressive, female-friendly labor market. It is also possible that female millennials are more ambitious and competitive in their early years of work experience relative to females born in the 1960s.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

Notes

  1. Retention is critical to the validity of longitudinal data sets. Until 1991, the NLSY79 retention rate was 90.9%, and up to 2011, the NLSY97 retention rate was 84.1%. While attrition likely reduces the precision of this paper’s results, it could also bias the results if attrition is non-random.

  2. The National Longitudinal Surveys suggest that researchers do not use sample weights when implementing regression analysis on longitudinal data, and thus descriptive statistics and results are constructed using unweighted data.

  3. Of course, it is also possible that a larger percentage of this cohort will choose not to marry or not have children, but this statistic cannot be accurately measured at this early point in the individual’s lifecycle.

  4. A similar methodology is used by Avellar and Smock (2003) to compare the motherhood wage penalty across two birth cohorts.

  5. For all fixed effects models, the Hausman test indicates a need for a fixed effects model versus a random effects model.

  6. Although the JMP decomposition method is widely used in the wage inequality literature, it is not without shortcomings. These papers, along with Datta Gupta et al. (2006) and Lemieux (2006), describe some of the issues surrounding the technique.

  7. Previous research finds that the motherhood penalty decreases with delayed fertility (Buckles 2008; Miller 2011). Thus, the coefficient on the number of children in the female-only models is likely overestimated compared to other analyses that measure the motherhood penalty using a sample of women who have reached the end of their child-bearing age.

References

  • Avellar, S., & Smock, P. J. (2003). Has the price of motherhood declined over time? A cross-cohort comparison of the motherhood wage penalty. Journal of Marriage and Family, 65(3), 597–607.

    Article  Google Scholar 

  • Babcock, L., & Laschever, S. (2003). Women Don't ask: Negotiation and the gender divide. Princeton: Princeton University Press.

    Google Scholar 

  • Barron, J. M., Black, D. A., & Loewenstein, M. A. (1993). Gender differences in training, capital, and wages. Journal of Human Resources, 28(2), 343–364.

    Article  Google Scholar 

  • Becker, G. (2010). The economics of discrimination (2nd ed.). Chicago: University of Chicago Press.

    Google Scholar 

  • Bertrand, M., Goldin, C., & Katz, L. F. (2010). Dynamics of the gender gap for young professionals in the financial and corporate sectors. American Economic Journal: Applied Economics, 2(3), 228–255.

    Google Scholar 

  • Black, S. E., & Strahan, P. E. (2001). The division of spoils: Rent-sharing and discrimination in a regulated industry. American Economic Review, 91(4), 814–831.

    Article  Google Scholar 

  • Blau, F. D., & Kahn, L. M. (1997). Swimming upstream: Trends in the gender wage differential in the 1980s. Journal of Labor Economics, 15(1), 1–42.

    Article  Google Scholar 

  • Blau, F. D., & Kahn, L. M. (2006). The US gender pay gap in the 1990s: Slowing convergence. Industrial & Labor Relations Review, 60(1), 45–66.

    Article  Google Scholar 

  • Blau, F. D., & Kahn, L. M. (2007). The gender pay gap: Have women gone as far as they can? The Academy of Management Perspectives, 21(1), 7–23.

    Article  Google Scholar 

  • Buckles, K. (2008). Understanding the returns to delayed childbearing for working women. The American Economic Review, 98(2), 403–407.

    Article  Google Scholar 

  • Bureau of Labor Statistics, U.S. Department of Labor. (2011). Usual weekly earnings of wage and salary workers – second quarter 2011.

  • Bureau of Labor Statistics, U.S. Department of Labor (2017). CPI-All Urban Consumers (Current Series. Retrieved from http://www.usinflationcalculator.com/inflation/consumer-price-index-and-annual-percent-changes-from-1913-to-2008/.

  • Bureau of Labor Statistics, U.S. Department of Labor. National Longitudinal Survey of Youth 1997 cohort. (1997–2014). Retrieved from https://www.bls.gov/nls/. Date last accessed: October 2016.

  • Bureau of Labor Statistics, U.S. Department of Labor. National Longitudinal Survey of Youth 1979 cohort. (1979–2012). Retrieved from https://www.bls.gov/nls/. Date last accessed: October 2016.

  • Burnette, J. (2012). Testing for wage discrimination in U.S. manufacturing. US Census Bureau Center for economic studies paper no. CES-WP- 12-23. Available at SSRN: http://ssrn.com/abstract=2205114 or doi:10.2139/ssrn.2205114

  • Charles, K. K., Guryan, J., & Pan, J. (2009). Sexism and women’s labor market outcomes. Working Paper.

  • Choudhury, S. (1993). Reassessing the male-female wage differential: A fixed effects approach. Southern Economic Journal, 60(2), 327–340.

    Article  Google Scholar 

  • Datta Gupta, N., Oaxaca, R. L., & Smith, N. (2006). Swimming upstream, floating downstream: Comparing women’s relative wage progress in the United States and Denmark. Industrial and Labor Relations Review, 59(2), 243–266.

    Article  Google Scholar 

  • DiPrete, T. A., & Buchmann, C. (2006). Gender-specific trends in the value of education and the emerging gender gap in college completion. Demography, 43(1), 1–24.

    Article  Google Scholar 

  • Fortin, N. M. (2008). The gender wage gap among young adults in the United States: The importance of money versus people. Journal of Human Resources, 43(4), 884–918.

    Article  Google Scholar 

  • Garcia, J., Hernández, P. J., & Lopez-Nicolas, A. (2001). How wide is the gap? An investigation of gender wage differences using quantile regression. Empirical Economics, 26(1), 149–167.

    Article  Google Scholar 

  • Gneezy, U., Niederle, M., & Rustichini, A. (2003). Performance in competitive environments: Gender differences. The Quarterly Journal of Economics, 118(3), 1049–1074.

    Article  Google Scholar 

  • Goldin, C., & Rouse, C. (2000). Orchestrating impartiality: The impact of ‘blind’ auditions on female musicians. American Economic Review, 90, 715–741.

    Article  Google Scholar 

  • Hellerstein, J. K., Neumark, D., & Troske, K. R. (2002). Market forces and sex discrimination. Journal of Human Resources, 37, 353–380.

    Article  Google Scholar 

  • Juhn, C., Murphy, K. M., & Pierce, B. (1993). Wage inequality and the rise in returns to skill. Journal of Political Economy, 101(3), 410–442.

    Article  Google Scholar 

  • Leibbrandt, A., & List, J. A. (2012). Do women avoid salary negotiations? Evidence from a large scale natural field experiment. NBER Working Paper No. 18511.

  • Lemieux, T. (2006). Increasing residual wage inequality: Composition effects, noisy data, or rising demand for skill? American Economic Review, 96(3), 461–498.

    Article  Google Scholar 

  • Lowen, A., & Sicilian, P. (2009). Family-friendly fringe benefits and the gender wage gap. Journal of Labor Research, 30(2), 101–119.

    Article  Google Scholar 

  • Manning, A., & Saidi, F. (2010). Understanding the gender pay gap: What's competition got to do with it? Industrial and Labor Relations Review, 63(4), 681–698.

    Article  Google Scholar 

  • Manning, A., & Swaffield, J. (2005). The gender gap in early-career wage growth, CEP discussion Paper No. 700.

  • Miller, A. R. (2011). The effects of motherhood timing on career path. Journal of Population Economics, 24(3), 1071–1100.

    Article  Google Scholar 

  • Mincer, J., & Polachek, S. (1974). Family investments in human capital: Earnings of women. Journal of Political Economy, 82, S76–S108.

    Article  Google Scholar 

  • Neumark, D., Bank, R. J, & Van Nort, K. D. (1996). Sex discrimination in restaurant hiring: An audit study. The Quarterly Journal of Economics, 111(3), 915–941.

    Article  Google Scholar 

  • O’Neill, J., & Polachek, S. (1993). Why the gender gap in wages narrowed in the 1980s. Journal of Labor Economics, 11(1), 205–228.

    Article  Google Scholar 

  • Rigdon, M. (2012). An experimental investigation of gender differences in wage negotiations. Working paper. Available at doi:10.2139/ssrn.2165253.

  • Solberg, E., & Laughlin, T. (1995). The gender pay gap, fringe benefits, and occupational crowding. Industrial and Labor Relations Review, 48(4), 692–708.

    Article  Google Scholar 

  • Taylor, P., Passel, J., Wang, W., Velasco, G. (2011). For millennials, parenthood trumps marriage. Pew Research Center.

  • Wang, W., Parker, K., & Taylor, P. (2013). Breadwinner moms. Pew Research Center.

  • Weinberger, C. J., & Kuhn, P. J. (2010). Changing levels or changing slopes? The narrowing of the gender earnings gap 1959-1999. Industrial and Labor Relations Review, 63(3), 384–406.

    Article  Google Scholar 

  • Wood, R. G., Corcoran, M. E., & Courant, P. N. (1993). Pay differences among the highly paid: The male-female earnings gap in lawyers' salaries. Journal of Labor Economics, 11(3), 417–441.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. School of Business , Mount Mary University, 2900 North Menomonee River Parkway, Milwaukee, WI, 53222, USA

    Kristen Roche

Authors
  1. Kristen Roche
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Kristen Roche.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Roche, K. Millennials and the Gender Wage Gap in the U.S.: A Cross-Cohort Comparison of Young Workers Born in the 1960s and the 1980s. Atl Econ J 45, 333–350 (2017). https://doi.org/10.1007/s11293-017-9546-6

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11293-017-9546-6

Keywords

JEL

Search

Navigation