The Earnings Gender Gap for Self-Employed Millennials: Evidence from the NLSY 97

Megan M. Way, Babson College
Jessica Simon, Babson College

Is there a difference in earnings for self-employed women and men of the Millennial generation, and if so, is it related to fertility? Understanding if the returns to self-employment are enjoyed equally between male and female Millennials, particularly as they cope with the aftermath of the Great Recession and face their peak years of fertility, is important for policy-makers as well as career and educational advisers. Using 2010 data from the NLSY 97, we find that there are significant aggregate and per hour earnings differences, in the range of 85% higher earnings for men. Women overall, even childless women, work less than full-time, and men on average work about 10 hours per week more than women, regardless of childbearing. Controlling for other factors we find having a child is negatively correlated with earnings for self-employed women, but not men. Other significant factors include incorporation status, marital status and industry category.