The economists examined whether parents make a “rational” financial decision and examined the impact on income when men were paid more than their partner.
But where a woman was the main breadwinner in a pair of parents, there was a financial penalty for being a mother.
“Even for mothers who clearly overearn their partner, there is a significant and long-term child penalty,” the economists noted.
Australian women pay a larger ‘maternity penalty’ than women in other developed countries. An estimated 25 percent in Denmark, 36 percent in the UK, 34 percent in the US and 40 percent in Sweden. Australia’s gap is smaller than the estimated penalty in Germany (70 percent) and Austria (71 percent).
Australian women already face a gender pay gap.
The Workplace Gender Equality Agency found earlier this year that the wage gap between men and women was 13.8 percent, down 0.4 percentage points from last year.
Full-time women have a pay gap of 16.4 percent, or $316.80 per week. The largest gap is in Western Australia at 21.2 per cent, while the narrowest is in South Australia at 7.4 per cent.
But motherhood doesn’t just affect women’s income.
The economists found that women’s job satisfaction began to decline up to a year before giving birth, suggesting that women are reducing their job expectations before they reach the maternity ward.
“The longer-term effects of having children can be unforeseen and there are significant challenges in re-entering the labor market. In contrast, men’s satisfaction with their job opportunities does not change significantly over time,” they said.
Danielle Wood, executive director of the Grattan Institute, said if the country were to take serious action on maternity punishment, the cost of caring for children would need to be shared more fairly.
She said having more fathers take an active role in caregiving would reduce women’s economic disadvantage, improve men’s life satisfaction and improve children’s developmental outcomes.
“We continue to urge women to pay a tremendous economic price for having children,” she said.
“The level of fines contributes to gender inequality and higher rates of poverty among women”
At the federal government’s labor market summit in early September, topics such as equality and participation will be discussed. This is expected to center on the government’s promise to extend the childcare subsidy to virtually all households in July next year.
Treasurer Jim Chalmers said on Tuesday better access to childcare is as important to tackling Australia’s employment and skills problems as increased immigration.
“I want to warn people not to think that migration is the solution to all of our economic challenges. It’s part of the story, but it’s not the whole story. And it shouldn’t be a substitute for training Australians for roles, it shouldn’t be a substitute for childcare reform,” he told ABC radio.
The Treasury Department plans to study how the “child penalty” is affecting different industries and geographies.
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https://www.smh.com.au/politics/federal/the-motherhood-penalty-women-s-wages-drop-for-up-to-a-decade-after-birth-20220712-p5b13w.html?ref=rss&utm_medium=rss&utm_source=rss_politics_federal Women’s wages fall for up to a decade after childbirth