This paper links American Community Survey data and postsecondary transcript records to examine how the gender pay gap varies across the distribution of education credentials for a sample of 2003-2013 graduates. Although recent literature emphasizes gender inequality among the most-educated, we find a smaller gender pay gap at higher education levels. Field-of-degree and occupation effects explain most of the gap among top bachelor's graduates, while work hours and unobserved channels matter more for less-competitive bachelor's, associate, and certificate graduates. We develop a novel decomposition of the child penalty to examine the role of children in explaining these results.
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Is the Gender Pay Gap Largest at the Top?
December 2023
Working Paper Number:
CES-23-61
No: it is at least as large at bottom percentiles of the earnings distribution. Conditional quantile regressions reveal that while the gap at top percentiles is largest among the most-educated, the gap at bottom percentiles is largest among the least-educated. Gender differences in labor supply create more pay inequality among the least-educated than they do among the most-educated. The pay gap has declined throughout the distribution since 2006, but it declined more for the most-educated women. Current economics-of-gender research focuses heavily on the top end; equal emphasis should be placed on mechanisms driving gender inequality for noncollege-educated workers.
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Who Scars the Easiest? College Quality and the Effects of Graduating into a Recession
September 2024
Working Paper Number:
CES-24-47
Graduating from college into a recession is associated with earnings losses, but less is known about how these effects vary across colleges. Using restricted-use data from the National Survey of College Graduates, we study how the effects of graduating into worse economic conditions vary over college quality in the context of the Great Recession. We find that earnings losses are concentrated among graduates from relatively high-quality colleges. Key mechanisms include substitution out of the labor force and into graduate school, decreased graduate degree completion, and differences in the economic stability of fields of study between graduates of high- and low-quality colleges.
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Selection and Specialization in the Evolution of Marriage Earnings Gaps
October 2015
Working Paper Number:
CES-15-36
We examine changes in marriage and earnings patterns across four cohorts born between 1936 and 1975, using data from a series of Survey of Income and Program Participation panels linked to administrative data on earnings. We find that for both men and women, marriage has become increasingly positively associated with education and earnings potential. We compare ordinary least squares (OLS) and fixed effect (FE) estimates of the earnings differential associated with marriage. We find that the marriage earnings gap fell for women in fixed-effect estimates implying that the impact of specialization has diminished over time. We also find that increasingly positive selection into marriage means that OLS estimates overstate the reduction in the marriage earnings gap. While our findings imply that marriage is no longer associated with lower earnings among women without minor children in our most recent cohort, the motherhood gap remains large. Among men, we find that the marriage premium actually increases for more recent birth cohorts in fixed-effects regressions.
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The impact of manufacturing credentials on earnings and the probability of employment
May 2022
Working Paper Number:
CES-22-15
This paper examines the labor market returns to earning industry-certified credentials in the manufacturing sector. Specifically, we are interested in estimating the impact of a manufacturing credential on wages, probability of employment, and probability of employment specifically in the manufacturing sector post credential attainment. We link students who earned manufacturing credentials to their enrollment and completion records, and then further link them to their IRS tax records for earnings and employment (Form W2 and 1040) and to the American Community Survey and decennial census for demographic information. We present earnings trajectories for workers with credentials by type of credential, industry of employment, age, race and ethnicity, gender, and state. To obtain a more causal estimate of the impact of a credential on earnings, we implement a coarsened exact matching strategy to compare outcomes between otherwise similar people with and without a manufacturing credential. We find that the attainment of a manufacturing industry credential is associated with higher earnings and a higher likelihood of labor market participation when we compare attainers to a group of non-attainers who are otherwise similar.
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Gender Segregation Small Firms
October 1992
Working Paper Number:
CES-92-13
This paper studies interfirm gender segregation in a unique sample of small employers. We focus on small firms because previous research on interfirm segregation has studied only large firms and because it is easier to link the demographic characteristics of employers and employees in small firms. This latter feature permits an assessment of the role of employer discrimination in creating gender segregation. Our first finding is that interfirm segregation is prevalent among small employers. Indeed men and women rarely work in fully integrated firms. Our second finding is that the education and gender of the business owner strongly influence the gender composition of a firm's workforce. This suggests that employer discrimination may be an important cause of workplace gender segregation. Finally, we estimate that interfirm segregation can account for up to 50% of the gender gap in annual earnings.
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An Evaluation of the Gender Wage Gap Using Linked Survey and Administrative Data
November 2020
Working Paper Number:
CES-20-34
The narrowing of the gender wage gap has slowed in recent decades. However, current estimates show that, among full-time year-round workers, women earn approximately 18 to 20 percent less than men at the median. Women's human capital and labor force characteristics that drive wages increasingly resemble men's, so remaining differences in these characteristics explain less of the gender wage gap now than in the past. As these factors wane in importance, studies show that others like occupational and industrial segregation explain larger portions of the gender wage gap. However, a major limitation of these studies is that the large datasets required to analyze occupation and industry effectively lack measures of labor force experience. This study combines survey and administrative data to analyze and improve estimates of the gender wage gap within detailed occupations, while also accounting for gender differences in work experience. We find a gender wage gap of 18 percent among full-time, year-round workers across 316 detailed occupation categories. We show the wage gap varies significantly by occupation: while wages are at parity in some occupations, gaps are as large as 45 percent in others. More competitive and hazardous occupations, occupations that reward longer hours of work, and those that have a larger proportion of women workers have larger gender wage gaps. The models explain less of the wage gap in occupations with these attributes. Occupational characteristics shape the conditions under which men and women work and we show these characteristics can make for environments that are more or less conducive to gender parity in earnings.
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Diversity and Labor Market Outcomes in the Economics Profession
July 2022
Working Paper Number:
CES-22-26
While the lack of gender and racial diversity in economics in academia (for students and professors) is well-established, less is known about the overall placement and earnings of economists by gender and race. Understanding demand-side factors is important, as improvements in the supply side by diversifying the pipeline alone may not be enough to improve equity in the profession. Using the Survey of Earned Doctorates (SED) linked to Longitudinal Employer-Household Dynamics (LEHD) jobs data, we examine placements and earnings for economists working in the U.S. after receiving a PhD by gender and race. We find enormous dispersion in pay for economists within and across sectors that grows over time. Female PhD economists earn about 12 percent less than their male colleagues on average; Black PhD economists earn about 15 percent less than their white counterparts on average; and overall underrepresented minority PhD economists earn about 8 percent less than their white counterparts. These pay disparities are attenuated in some sectors and when controlling for rank of PhD granting institution and employer.
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Virtual Charter Students Have Worse Labor Market Outcomes as Young Adults
June 2023
Working Paper Number:
CES-23-32
Virtual charter schools are increasingly popular, yet there is no research on the long-term outcomes of virtual charter students. We link statewide education records from Oregon with earnings information from IRS records housed at the U.S. Census Bureau to provide evidence on how virtual charter students fare as young adults. Virtual charter students have substantially worse high school graduation rates, college enrollment rates, bachelor's degree attainment, employment rates, and earnings than students in traditional public schools. Although there is growing demand for virtual charter schools, our results suggest that students who enroll in virtual charters may face negative long-term consequences.
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Trends in Earnings Inequality and Earnings Instability among U.S. Couples: How Important is Assortative Matching?
January 2015
Working Paper Number:
CES-15-04
We examine changes in inequality and instability of the combined earnings of married couples over the 1980-2009 period using two U.S. panel data sets: Social Security earnings data matched to Survey of Income and Program Participation panels (SIPP-SSA) and the Panel Study of Income Dynamics. Relative to male earnings inequality, the inequality of couples' earnings is both lower in levels and rises by a smaller amount. We also find that couples' earnings instability is lower in levels compared to male earnings instability and actually declines in the SIPP-SSA data. While wives' earnings played an important role in dampening the rise in inequality and year-to-year variation in resources at the family level, we find that marital sorting and coordination of labor supply decisions at the family level played a minor role. Comparing actual couples to randomly paired simulated couples, we find very similar trends in earnings inequality and instability.
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Earnings Inequality and Coordination Costs: Evidence from U.S. Law Firms
September 2009
Working Paper Number:
CES-09-24
Earnings inequality has increased substantially since the 1970s. Using evidence from confidential Census data on U.S. law offices on lawyers' organization and earnings, we study the extent to which the mechanism suggested by Lucas (1978) and Rosen (1982), a scale of operations effect linking spans of control and earnings inequality, is responsible for increases in inequality. We first show that earnings inequality among lawyers increased substantially between 1977 and 1992, and that the distribution of partner-associate ratios across offices changed in ways consistent with the hypothesis that coordination costs fell during this period. We then propose a 'hierarchical production function' in which output is the product of skill and time and estimate its parameters, applying insights from the equilibrium assignment literature. We find that coordination costs fell broadly and steadily during this period, so that hiring one's first associate leveraged a partner's skill by about 30% more in 1992 than 1977. We find also that changes in lawyers' hierarchical organization account for about 2/3 of the increase in earnings inequality among lawyers in the upper tail, but a much smaller share of the increase in inequality between lawyers in the upper tail and other lawyers. These findings indicate that new organizational efficiencies potentially explain increases in inequality, especially among individuals toward the top of the earnings distribution.
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