Pew Finds That Working Women Boost Family Economic Mobility

Washington, DC (PRWEB) April 01, 2014

The Pew Charitable Trusts today released a study finding that women in their prime working years are earning three times more than their working mothers did at the same age, strengthening family financial well-being. Women work 10 hours more per week and earn $9 more per hour than the previous generation, translating into higher annual earnings. These higher earnings, which have been adjusted for inflation, have helped families maintain their places on the economic ladder or, particularly for families at the bottom, to move up. But even as women have increased their wages by 50 percent or more at every rung of the income ladder, they still make less than men did on the same rung more than three decades ago.

“These findings emphasize the importance of women’s earnings for family financial security and upward mobility,” said Erin Currier, who directs Pew’s economic mobility research. “But given women’s lower wages relative to men, families still don’t fully benefit from their work.”

The report, Women’s Work: The Economic Mobility of Women Across a Generation, compares women and men in their prime working years between 2000 to 2008 to workers in their prime approximately thirty years before. Historically, it has been difficult to compare women’s earnings because of the large shifts in their workforce participation. This study controls for demographic and labor market differences to create more accurate comparisons between mothers and daughters.

The report finds that middle-class families have particularly benefited from the increase in women’s work hours: the number of middle-income households earning more than their parents rose by 13 percentage points. However, despite all of the gains for working women, men’s wages are nearly twice as important for determining higher family income.

Among the findings:

• Median hourly wages increased for both women and men compared with the previous generation. At every rung of the economic ladder, women’s median wages rose by 50 percent or more, but daughters continue to earn lower hourly wages than fathers did on the same rung.
• Today’s generation of women who work full time contribute more than half of family incomes, strengthening financial security. The extent of this contribution, however, varies based on family structure: Working women who are in a couple (either married or cohabiting) supply 45 percent. Working women who are single supply 81 percent, with the remainder of their income from nonwage sources.
• Daughters’ higher hours worked are associated with increased rates of upward family earnings mobility, especially in the bottom and middle of the earnings distribution.
• Despite women’s significant generational gains, men’s wages remain more important to increasing couples’ family income, a key factor for upward mobility.

To conduct this study, Pew used data from the Panel Study of Income Dynamics to evaluate income, wealth, earnings, and wages for women and men in their prime working years. In the parent generation, data are reported for the years 1968 to 1972. For their children’s generation, data are analyzed for the years 2000 to 2008. Data were adjusted to 2009 dollars but were not adjusted for family size to better understand the separate earnings contributions of women and men.

The Pew Charitable Trusts is driven by the power of knowledge to solve today’s most challenging problems. Pew applies a rigorous, analytical approach to improve public policy, inform the public, and stimulate civic life.