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6 February 2018

The impact of part-time working on the gender pay gap

As so often happens, the press seized upon a simple headline, namely that the gender pay gap is down to women working part-time – but to say that is to do the paper’s authors a disservice; the situation is much more nuanced than the headlines implied.

IFS found that gender differences in rates of full-time and part-time paid work after childbirth are an important driver of differences in hourly wages between men and women. This is because they affect the amount and type of labour market experience that men and women build up, and this experience affects the hourly wage levels they can command.

While it used to be the case that women’s lower earnings were due to their taking time out to have children, improved maternity and parental rights mean that the main impact of experience now arises from women’s greater likelihood of working part-time after childbirth. The IFS paper states that this is because extra experience in fulltime work leads to higher hourly wages, whereas extra experience in part-time work does not. But, as the IFS says, and the press coverage largely forgot to mention, a key challenge for future research is to understand why part-time work shuts down wage progression so much.

The IFS goes on to consider the possible reasons for part-time working having such an adverse impact on earnings. These include less training provision, missing out on informal interactions and networking opportunities, and genuine constraints placed upon the build-up of skill by working fewer hours. Understanding this properly looks of great potential importance for policymakers who want to address the gender wage gap.

The report also suggests an alternative (or complementary) focus, namely to seek to understand the causes of gender differences in rates of full-time work in the first place, such as the division of childcare responsibilities. 

But don’t we also need to understand at what level of part-time working does wage progression begin to shut down?  At 30 hours a week? Surely not.  At 7 hours a week? Possibly. And in what types of role?  Do people who, for example, combine a medical specialism with research, experience a discounted rate of pay? Almost certainly not, and yet they will be holding two part-time roles. We do need to know more – but such questions have been being asked for decades – will someone please come up with the answers!

The IFS briefing paper deserves close consideration. You can find it here.

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