Gender Inequalities in Early Career Trajectories and Parental Leaves: Evidence from a Nordic Welfare State

Abstract

Parental leaves are, besides unemployment, the main reason for career breaks in early career. Despite the progress in recent decades towards more equal sharing of childcare between mothers and fathers, the labour market risk due to parenting remains mainly with women. In this article, we analyse how parental leaves relate to early career trajectories of young Finnish men and women. Using longitudinal register data for 2005–2016 from the Finnish Centre for Pensions, we perform a multi-trajectory analysis of the labour market attachment of a cohort born in 1980. Based on working days and earnings, we find five distinct career trajectories for both men and women, with the majority being well attached to the labour market by their mid-30s. While men and women on average have similar employment lengths, the gender gap in earnings is already 30 per cent in this early career phase. One of the causes may be found in the highly unequal division of family-related career breaks; the duration of mothers’ family-related leaves in this cohort was 13 times longer than fathers’ leave spells. Long home care leaves were particularly common among mothers with low education levels and weak attachment to the labour market. Efforts towards a more equal division of parental leaves are needed in order to combat gender inequalities that already emerge in early career and potentially cause life-long disadvantages for women’s careers, earnings and pensions.