The in the UK had dropped to a record

The modern workplace is the most equitable in history. At no
other point in developed nations have men, women, races and minorities had such
equal rights to work and had such opportunities to work, with laws preventing
discrimination being increasingly introduced in the last several decades.  For instance, the ONS (2017) recently claimed
the gender pay gap in the UK had dropped to a record low, across all fields.
However, despite this advancement in opportunities inequality is still rife
with huge social divisions growing. More worryingly however is the fact a new
gap is appearing; the family gap. This gap is related to significant variances
in income for individuals who have children/family and those who chose not to
raise a family whilst working thus dividing society further still. Is it time
for policy against this form of discrimination to be introduced?

Traditionally variation in the labour market have been
focussed on females earning less than women; early this year a report in the UK
was published showing the lower average incomes for women than men in 500 top
companies (BBC, 2018). Over the course of recent history women were expected to
relinquish jobs when having children or simply never take a job and maintain
the homestead whilst her husband was the ‘bread winner’. Even today some women
with children may be less likely to go back to work. It is this societal expectation
which is causing new divides within nations. However, it is important to
realise male parents are now taking paternity leave and altering the structure
of their life in a similar way to mothers (Rehel, 2013). It therefore stands to
reason that men can also be discriminated against in the same way that women
are currently experiencing, in regard to having a family.  

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Inequality in society is becoming a more and more central
debate. Therefore, this study proposes to analyse the impact of children on men
and women’s labour market activity (particularly the impact that children have
on their parent’s positions within the workplace) and find market solutions to
the emerging issues to prevent the spread of inequality between men and women
with families and those without. The study will initially focus on the UK, due
to the readily available data set ‘The British Household Panel Survey;
Understanding Society’, however will be later expanded to consider other
developed, due to their similar working laws, from Europe and across the world
in cross country analysis to see if the trends are global or limited to nation’s
because of individual factors, with the ultimate aim of providing policy recommendations
to curtail the spread of inequality in society.

Literature Review

Primary research, Ruckdeschel (2009), proposes there is a
negative attitude towards working mothers in developed nations which thus
prohibits mothers from easily accessing the work place or earning the wages
they were previously accustomed. Salamaliki (2012), proves the existence of a
negative relationship between female labour supply with the number of children
she has. In other words, the more children a woman has the less she works. This
evidence suggests incompatibility hypothesis, which considers women’s
employment and fertility affecting each other reciprocally. Sobotka et al.
(2011), find the reverse of this relationship, thus inferring a similar result,
by proving in recessions women work more and have less children due to harder
economic conditions changing their immediate priorities and mentality of having
children. O’Neill (2003) further validates this finding and suggests that a
continual wage gap over their working life is partly attributable to the
employment gender gap that exists after both men and women become parents.
These findings could be explained by the fact women and/or men chose not to
work after having children due to wanting to spend time with their children, or
the high price of child care would erode their standard of living rendering
work pointless. However, this does not justify or explain wage differentials
and discrimination in the labour force if they wish to return.

Despite the evidence suggesting women are less likely to
participate in the labour market after having children one more recent study
conducted by Borck (2014) suggests the contrary. It is suggested in this study
that women who have children often work more, a positive relationship, found in
a cross-country analysis and seen in the graph below. Although, this anomaly
can be explained by the fact children are expensive and as such some mothers
may have to work more to raise their child and maintain the household income,
especially if the family erodes their wages.

 

 

 

 

 

 

 

 

 

 

Satisfaction with life is also important to consider within
this field. Haller and Hadler (2006) show in their study that having children
puts additional strain on parent’s mental wellbeing (both men and women) caused
by the pressure of caring and raising the child well. The wide range of other
literature including Frey and Stutzer (2000) and Di Tella et al; Smith (2003)
validate Haller and Hadler’s findings with the latter stating a greater
decrease in satisfaction arising in developed nations such as the UK and the
USA with an additional child. This fall in life satisfaction could be key to
the fall in labour market activity as a fall in motivation to work and
satisfaction derived from work would inevitably curve an individual’s
performance hindering promotion opportunities and/or participation at all.
Concurrently it also provides explanation for why the family gap has arisen for
those who do work. A desire to raise children well, regardless of their mental
wellbeing, necessitates labour market participation, even under discriminatory
conditions, to supply a certain level of income and living standards for
children.

Labour market activity, it must be remembered, does not only
state whether an individual is at work or not. It also covers promotional
opportunities, wages and number of hours worked. One study by Gjerberg (2012)
considered promotional opportunities to find that the probability of women
specialising in their chosen fields fell after having children. Similarly,
Windsor (2006) proved children significantly affected management advances of
female accountants. If these findings are true for females it is likely that
men, especially single fathers, suffer the same outcome.  

Data

The data set used in the initial proposal is a cross
section, wave 6, of ‘Understanding Society – The UK Household Longitudinal
Survey’. This project is an extension of the original British Household Panel
Survey which began in 1991, with the aim to capture important information
regarding “people’s social and economic circumstances, attitudes, behaviours
and health”1.
The statistical analysis program SPSS will be used to examine this data.

Before considering models, the data set first must be
cleaned. Any negative value in response to a question within the survey had to
be removed in ensure the most precise results possible. Values -11 to -1 were
recoded so that they will not be taken into consideration during analysis.
Moreover, the values for income are set at -1000000 to .000 to prevent
borrowers influencing results when income is considered.  

Due to the nature of this project focussing upon the
difference in male and female labour activities, the first task was to separate
these categories. This will be done by setting up two interchangeable filters
to search for men (Filter: f_sex=1) and women (Filter: f_sex=2) in isolation.

Model

The first model considered for use in this investigation was
the ordinary least squares model. However, this model proved to be flawed due
to the model providing answers outside the range of 0 and 1 rendering results
inapplicable to the binary dependant variable. A Logit model will therefore be
used to conduct analysis of the categorical dependant variable where results
will be limited to between 0 and 1, and measured to 1%, 5% and 10% significance
levels.

The dependant variables used will be coded to dummy
variables so that results will be given in logit form. The first dependant
variable will be called ‘EconomicallyActive’. This is coded from the variable
‘b_jstat’ in the raw data set with 1=economically active and 0=economically
inactive. A second dependant variable will be coded also to consider the
effects of employment opportunities with 1=higher positions and 0=lower
positions. The explanatory variables used will include being married, their
level of education (set to a minimum of 12 years or more), the having children
or not, age, income, white, if they live in an urban area, and location in
country.

The proposed models are as follows:

EconomicallyActive = ?0
+ ?1married + ?2education + ?3children + ?4white + ?5age + ?6lnincome
+ ?7urban + ?8location + u

JobClass = ?0
+ ?1married + ?2education + ?3children + ?4white + ?5age + ?6lnincome
+ ?7urban + ?8location + u

By controlling for the presence of children, their effect on
individual’s economic activity (and income) and their effect dependant on
individual circumstances will be able to be critically evaluated. The model,
and any subsequent changes, will be run through the previously mentioned
filters to assess the difference between males and females. This will provide
the preliminary findings. From here dummy variables for the number of children,
level of education, ethnicity and geographical location can be added to the
model to investigate more precise areas of interest. If possible data on
working laws will also be recovered and coded as dummy variables and controlled
for2.
 

After these initial trials have been conducted, and appropriately
adjusted, data will be gathered from other developed nations. World Bank Data
provides information regarding GDP per capita. It is from this data that other
nations will be selected. Other nations of roughly the same income as the UK (USA,
Canada, New Zealand, Japan and UAE) and three very high-income countries
(Monaco, Lichtenstein and Luxembourg) will initially be considered, with option
for appropriate expansion. With a range of nations considered a trend can or
cannot be identified. This will provide preliminary evidence as to whether this
is a phenomenon secular to the UK or not. The study can also be further
expanded for developing nations however the availability of data and
differences in cultures and working laws are likely to distort findings. These
findings will direct policy implications in the direction of a global
suggestion of employment laws or on purely national levels which can be more
finely honed.

Conclusion

In summary, the world, especially in developed nations, is
changing. Everybody is now entitled to work and has the greatest opportunities
to work in history.  However, we still in
in the most inequitable society, financially, in history with the rich getting
richer and men possessing the majority of high paying jobs. This issue must be
dealt with at an international and national level. One way to counteract this
division is by identifying the differences between male and female groups, in
this case caused by children known as the family gap. This proposed
investigation hopes to locate these particular causes of disparity between
males and females, who do and don’t have families, through statistical analysis,
here exemplified using data from the UK, and develop appropriate policy
responses to help prevent the rise of inequality between people with and
without families.

 

1
Understanding Society. (2016). About the Study

2
Note further expansion of the model is dependent on the impact of significance
levels and the issue of multicollinearity and models will be refined
accordingly