The Motherhood Wage Penalty: Estimation Across Various Factors

Maternity and family leave policies are implemented in the workplace and sometimes even mandated by governments to allow first-time mothers to provide care for their newborns and recover from childbirth. However, these policies vary by country, and previous research publications have found that women face a “motherhood penalty” when they take a leave from work, leading to reduced earnings compared to women who do not have children. The main purpose of this paper is to validate whether new mothers do in fact face a decrease in their earnings over time, to compare this penalty across numerous variables, and to explore if the implementation and generosity of maternity and family leave policies influence women’s employment and earnings. The variables considered include wages, years of work experience, level of education attained, if the worker holds at least a bachelor’s degree, marital status, union membership, and the existence of maternity and family leave programs. The methodology of this study comes down to compiling publicly available data to yield the descriptive and empirical results of women’s earnings and explore the effect of having a child. Additionally, I compare the maternity and family leave policies of the United States and other countries. I predict that the data will prove the existence of a motherhood penalty on wages and that the previously mentioned factors will be statistically significant. The findings will be essential for policymakers in federal and state governments as they consider the expansion of these programs and how they can be financed.