The motherhood penalty on retirement income

Abstract

This study investigates whether the motherhood penalty on retirement income exists in Gozo. It attempts to determine which factors including children, career breaks, dependent relatives and flexible working conditions cause a decrease in the retirement income of females in Gozo. To reach this objective, this study makes use of primary data collected through an online survey among Gozitan females aged between 25 and 50. The first analysis carried out is a qualitative analysis for all valid responses, from which a number of tendencies are derived. This is followed by a regression analysis, whereby an OLS regression is conducted for employed females to determine which factors impact their wage which in turn leads to a higher or lower pension income. The survey data suggests that on average Gozitan mothers do earn a lower wage and thus a lower pension income due to interruptions during their working life. Other factors, other than career breaks, age and education, do not seem to have a significant impact on retirement income. Findings from the regression analysis indicate that career breaks taken in order to take care of children are a significant variable in explaining a lower pension income for Gozitan females. Results also show that children do not necessarily cause a decrease in retirement income provided that they do not cause the mother to stop working. Similarly, the number of dependent relatives, flexible working conditions, and the female’s marital status have no effect on wage or on retirement income. From this study, it was also evident that factors such as age and education prove to increase one’s pensionable income due to a higher wage during his or her working life. Thus, there is a form of motherhood penalty in Gozo related to the discontinuous working life of Gozitan mothers.