Why the gender pay gap opens with the first child

Imagine lining up every working-age woman in America over the last two hundred years and asking, decade by decade, how many were doing paid work. You might guess the number just kept rising as the country got richer. It did not.

It dipped first. On farms, women worked all day. When factories took over, married women were pushed out of paid jobs, so the number fell. Later, as offices, shops, schools and hospitals grew, women came back. Drawn out on a chart, the trend looks like the letter U.

Goldin's real gift was the digging. She rebuilt two centuries of records that had quietly logged farmers' wives and home weavers as having no job at all, and only then could the true picture appear.

Claudia Goldin is an economic historian. To study women and work she did something unglamorous and decisive: she went into 200 years of US archives and rebuilt the data, because older records often logged a farmer's wife or a home weaver as having no occupation.

With cleaner numbers a clear shape appeared. Female labour-force participation did not climb steadily with economic growth. It traced a U. In the early 1800s, as the economy moved from farms to factories, married women's participation fell, held down by social norms and a labour market rebuilt around male industrial jobs. From the early 1900s, as clerical and service work expanded and schooling spread, women returned. Growth on its own, Goldin showed, does not draw women into paid work; the kind of work and the norms around it decide.

Yet a gap remained. In rich countries women are now often more educated than men and equal-pay laws exist, but women still earn roughly 10 to 20 percent less. Goldin, with Marianne Bertrand and Lawrence Katz, traced where this gap comes from. At graduation, pay is nearly equal. It is parenthood that bends the two paths apart: after the first child, mothers' earnings drop and then grow more slowly, even when the mother and father hold the same degree and the same job.

Goldin's contribution is empirical and historical rather than theoretical. Her raw material is more than 200 years of US data on women's earnings and employment, much of it reconstructed from sources that systematically undercounted female labour. Correcting that measurement error was itself a result: a large share of married women's work in the agrarian and early industrial economy had simply gone unrecorded.

For the modern rise she identified a specific lever. In 'The Power of the Pill' (2002), Goldin and Lawrence Katz used the staggered timing of US state laws granting young, unmarried women access to oral contraception as a natural experiment. Cohorts with early access delayed marriage and first birth and invested in professional degrees, which helps explain the surge of women into law, medicine and business from the 1970s onward.

The mechanism she named is greedy work. Many high-paying jobs pay disproportionately more for long, continuous, on-call hours, so two parents cannot each hold one without sacrificing the care of their children. The household specialises: one parent, usually the father, takes the greedy job, while the other, usually the mother, takes flexible, lower-paid work. The gap, in this account, is less a matter of men versus women than a tax on whoever supplies the flexibility.

“If we want to eradicate or even narrow the pay gap, we must first plunge deeper toward the root of these setbacks and give the problem a more accurate name: greedy work.”Claudia Goldin, Career and Family (2021)