The Effects of Gender Differences in Career Interruptions on the Gender Wage Gap in Spain

ABSTRACT

The aim of this paper is to measure the influence of past employment interruptions on current wages and to analyze how these interruptions contribute to the gender wage gap. The discontinuity in labor trajectories of Spanish employees from 2005 to 2010 is examined by measuring the duration of unemployment periods from employees’ first Social Security affiliation to the last job at which they were employed. Through the use of the database “Muestra Continua de Vidas Laborales” (MCVL), the estimated gender wage gap is found to be 13.1 percent. Introducing an index of interruptions as an explanatory variable, the results show that interruptions have a negative impact on both men's and women's wages. These interruptions explain 7.4 percent of the daily gender wage gap in Spain, primarily because women experience more interruptions in employment than men.

KEYWORDS:

• Wage gap
• labor trajectories
• interruptions of employment

JEL Codes:

• J71
• J31

NOTES ON CONTRIBUTORS

Inmaculada Cebrián is Professor (Profesor Titular de Universidad) at the Department of Economics, University of Alcalá (Madrid). Her main field of research is labor economics. She specializes in the analysis of participation patterns and gender differences in the labor market, temporary work, working time, job turnover and stability of employment, wages and inequality, labor market institutions and evaluation of labor market policies. Her work has been published in national and international reports, books, and specialist journals.

Gloria Moreno is Professor (Profesor Titular de Universidad) in Economics at the University of Alcalá (Madrid). Her research interest is focused on the areas of labor economics, gender and family economics, time allocation, and the evaluation of employment and labor market policy. She has been involved in labor market analysis at national and European level, and she has participated in many research projects. Some of her publications on the subject of economics and gender concern the Spanish and European labor market, like women's labor force participation, wage discrimination, immigration, and the stability of employment or career paths.

ACKNOWLEDGMENTS

The authors are grateful to “Tesoreria General de la Seguridad Social” for providing the MCVL data.

Notes

1 The MCVL dataset provides annual information on more than 1 million people who have had some type of relationship with the Social Security Administration; data come from a 4 percent non-stratified random sample of all people in the Social Security system each year. The sample is restored every period to remain representative of the population.

2 This information from the Spanish Social Security Administration is linked with the Continuous Municipal Register and with tax data from the annual tax declaration of employers to the National Revenue Agency. This tax module provides the total amount paid by employers to their employees in a year, including total salary payments and any other type of compensation in cash or in kind.

3 We should not forget that the proportion of women leaving employment permanently during their labor market trajectory is greater than the proportion of men leaving permanently (Dominique Anxo, Letizia Mencarini, Ariane Pailhé, Anne Solaz, Maria Letizia Tanturri, and Lennart Flood 2011; Ainara González de San Román and Sara De la Rica 2012).

4 Although part-time jobs have a coefficient to measure how long working time is in terms of a full-time job, there is no information regarding how many hours are considered in the full-time job of reference. Moreover, previous analyses recommended excluding part-time jobs because these jobs are primarily held by women, and the results including part-time work could be somewhat biased.

5 This small figure for women, similar to the Spanish Labour Force Survey data (60.5 percent of men and 39.5 percent of women), is explained because the percentage of women employed on a full-time basis is lower than men.

6 This gross wage gap is around the wage gap obtained using information for full-time jobs, 16.76 in 2006 and 12.45 in 2010, from the Wage Structure Survey – a four-yearly survey carried out by the Spanish Institute of Statistics.

7 According to the test proposed by Clifford Clogg, Eva Petkova, and Adamantios Haritou (1995) to measure the differences between coefficients.

8 The explained portion is attributed to differences in average endowments, whereas the unexplained portion is related to differences in coefficients and intercepts.

9 The unexplained portion is often used as a measure of discrimination, although it can also be linked to omitted variables, as is the case for marital status or educational level in this analysis. However, this gap distribution between explained and unexplained portions is similar to the gap reported by other empirical analyses using different Spanish data (Hernández 1995; Simón, Ramos Lobo, and Sanroma 2008; González de San Román and De la Rica 2012).