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Economic penalties of having children.

As more females join the labor force--about 1,000,000 a year since 1950--the economic trade-off between career and children is becoming increasingly important. To see what price they pay for combining kids and a career, Martha N. Ozawa, a social work professor at Washington University, examined the earnings history of some 700,000 American women. She found that the more offspring a woman has, particularly a white woman, the less she'll earn over the course of her lifetime. "The bottom line is that women, not men, are economically penalized for having children."

Ozawa argues that, before females can earn equal pay for equal work, the effect of children on women's income must be neutralized. "It's the ultimate breakthrough issue women face in overcoming pay disparity." Traditionally, economists have ignored the effect of children on women's earnings because child rearing and working outside the home were both considered matters of choice, but that no longer is a factor in most women's decision to work outside the home. Income from wives' paychecks allows some 8,000,000 American families to stay above the poverty line, and without these earnings, the poverty rate of those families would double.

One reason they make less is because they take time out to have kids at a time when men and childless women are investing heavily in their careers. "It's not the income loss during leave. It's the fact that it all happens at such a crucial time. Other workers are increasing their per-hour wage rate, getting job training and generally improving themselves, careerwise."

The average annual earnings of females with kids rarely reach the same level as that of childless women, despite the fact that those with children try to "catch up" in the labor market by going back to work after their childbearing years. Ozawa found that, when the women in the study were in their 30s, a greater proportion of those without children were employed. When the women were in their late 40s and older, the reverse was true--a greater proportion of women with children worked.

She warns that the social implications behind this issue could be devastating. With the cost of having a child and even temporarily staying at home increasing, the already low fertility rate among well-educated women could plummet even further. "The logic behind this issue is that more babies will come from lower-educated women--those who won't be forgoing much income to have babies ... unless society makes it possible for women to have both children and a job, we will suffer consequences. More and more women may have to decide not to have babies."
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Publication:USA Today (Magazine)
Date:Apr 1, 1993
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