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Returning mothers face lower wage growth

Women returning to work after giving birth earn 33% less per hour than men, according to research by the Institute for Fiscal Studies (IFS).

The hourly wage gap for women after childbirth has widened over the last 12 years mainly due to reduced working hours rather than a cut in hourly pay. 

Further causes include missing out on promotions and gathering less labour market experience. 

Women taking extended time out of employment before returning to work has also been associated with lower wages.

Comparing those who had the same hourly wage before leaving, wages upon returning are on average 2% lower for each year spent out of employment.

The wage penalty is greater among highly educated women with an average annual wage penalty of 4%. 

Further findings:

  • there is no immediate drop in hourly wages when women reduce their hours to 20 or fewer per week. 
  • hourly wages observed in lower hour jobs continue to effect wage progression
  • wages of women working part-time appear not to benefit from increases in labour market experience.

Robert Joyce, associate director at IFS, said:

“Women in jobs involving fewer hours of work have particularly low hourly wages, and this is because of poor pay progression, not because they take an immediate pay cut when switching away from full-time work. 

“Understanding that lack of progression is going to be crucial to making progress in reducing the gender wage gap.”

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