The cost of early motherhood

Ready to start a family?  Not so fast, cautions Amalia Miller. According to the U.Va. economist’s latest study, waiting as little as a year could mean big financial rewards.

In her groundbreaking study, “The Effects of Motherhood Timing on Career Path,” Miller examined the effects of motherhood delay on the career earnings of women in their 20s and early 30s. On average, she found, a woman in this age group will earn 10 percent more over her lifetime if she delays motherhood for just one year. Although Miller perhaps wisely refuses to commit to an “optimal” age for motherhood, this percentage, she says, “is a number women should know when making that decision.”

More numbers women should know: On average, a motherhood delay of one year will also result in a 5 percent increase in career work experience and a 3 percent increase in career average wage rate. These figures contribute to the 10 percent overall increase in a woman’s career earnings. And that’s not all, Miller says. Statistically speaking, “If you waited two years, [this increase] would double; if you waited 10, you would double your earnings.”

Using data gathered by the Bureau of Labor Statistics, Miller studied more than 1,000 women who first gave birth between the ages of 20 and 33 between 1983 and 2000. Although Miller’s data represent women from all walks of life, she found that motherhood delay affected different groups of women in different ways. “The effects are not the same for all women,” Miller’s study reads, “and women with college degrees, and those in professional and managerial occupations receive the greatest returns.”  For example, among professional women, the increase in career average wage rate after one year of delay is 4.7 percent — not 3 percent. It is for these groups of women that Miller’s study is statistically significant.

Miller’s study, she says, was born of both her personal and professional interests in the topic. “My mom worked before and after having us,” Miller says. “In my community, that was unusual.”  Among colleagues and friends later in life, Miller, now 28, would often discuss the “right time” to start a family. “When is the right time?  Some thought grad school; others thought when you were tenured.”  Ultimately, they found the question impossible to answer. 

Miller became motivated to study the question in depth after reading Sylvia Hewlett’s bestselling book, “Creating a Life,” in which Hewlett interviews professional women who express regret that they did not have more children and at younger ages. Miller thought that perhaps these women had made a sacrifice — delayed motherhood — that had a rational component, and she wanted to find it.

What came somewhat easily to Miller: the effects of delayed motherhood on women’s career paths and earnings. How, however, would prove a giant obstacle. “As an economist, you’re kind of stuck when you try to find causal effects. ‘Okay, you get pregnant at 24, you at 25!’” she jests, adding that that sort of research probably wouldn’t go over too well with an institutional review board.

To prove causation in her research, Miller had to develop instrumental variables that were correlated with motherhood timing but not wages. The three she selected — “(1) whether first pregnancy ended in miscarriage, (2) whether conception of first child occurred while using contraception, and (3) duration, in years, of the conception attempt prior to first birth” — seek to randomize the age at which a woman gives birth to her first child. “These factors each shift a woman’s actual age at first birth away from her preferred age,” Miller writes.

Using these “biological fertility shocks” as instrumental variables, Miller was able to effectively compare women who first gave birth at different ages.

What she found is that the effects of motherhood on career earnings are twofold. For younger mothers, “There is a fixed penalty — wages go down — and the wage profile flattens,” she says. This flattened wage profile — wherein women’s wages don’t grow as quickly and the women are not promoted as much as childless women — is what Miller and others refer to as the “mommy track.”  

Surprisingly, Miller says, family leave laws do little to mitigate these effects.

While women ages 30 to 34 still experience the “mommy track,” they experience fewer fixed motherhood costs, Miller explains, sketching a wages-over-age figure from her research as she talks. “It’s likely that the benefits [of delay] do start to taper off at some point,” Miller suggests, but her data set, which spans women ages 21 to 34, does not extend to that point.

Miller’s 2005 study brings several interesting and exciting new points to the discussion of motherhood timing, but there are some caveats to her research, she cautions. “This is the average,” she says of her results. “It doesn’t mean it’s true for any particular woman.”  In addition, Miller’s findings, she points out, are only statistically significant for women who are college educated or in professional or managerial occupations.

When asked what advice she would give to women wanting to make the optimal decision, Miller is hesitant to make any generalizations. “Everybody has to know what’s best, what they value for themselves,” she says. “It’s an individual decision.”

Published in OscarNews, April 2006.