Friday, 14 January 2005 - 2:00 PM

This presentation is part of: Employment and Income

Differential effects of flexible work hours on wages of mothers and other women

Objectives: There has been considerable public attention on labor force participation of women with young children coupled with the increasing proportion of women’s earnings as a major source of family income. However, little scholarly work has been done on the effects that family responsive policies have had on the wages of women. The purpose of this study is to examine the differential effects of the provision of flexible work hours on the wages of women, particularly, women with child care responsibilities.

Data and Methods: Data are drawn from the National Longitudinal Survey of Youth79, 1989-2000, a nationally representative sample of young men and women aged 14 to 22 first surveyed in 1979. In the pooled datasets from 1989 through 2000, the female portion of the sample consists of 20,262 person-years as units of analysis. The outcome measure is the natural log of the hourly wage at a woman’s current job. Multiple imputation and propensity score matching are used to estimate the differential wage effects of the availability of flexible work hours on women.

Results: Results suggest that women with flexible work hours earn higher wages than those who have no such provision; this holds not only for working mothers but also for working women without children, indicating significant and substantial wage premiums for women with such a provision. In addition, when performing adjusted regressions on the matched sample, a wage penalty associated with having children was found. The results demonstrate, however, that the wage premiums associated with such a provision sufficiently offset the motherhood wage penalty.

Implications: These results have implications for the policy of flexible work hours, with regard to the way it is conceptualized and contributes to generating equal earning power and opportunity for women, particularly, women with children. The development and expansion of flexible work hours should be considered to help women balance work and family responsibilities and, as a consequence, secure income undiluted by a motherhood wage penalty. In addition, all families, regardless of income status, are in need of enriched family benefit packages that assist them with the costs associated with child rearing. Thus, more extensive family policies that provide benefits to supplement family income, including direct cash payments and tax benefits, should be a policy concern to best help balance work and family demands and to fully achieve gender equity and equality in the labor market.

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