The effect of parenthood on labour market outcomes for men

In this article we use longitudinal data from the German socio-economic Panel to examine the relationship between parenthood and labour market outcomes for men. Both traditional sociological and economical perspectives predict a positive effect of fatherhood on wages, whereas the spreading idea of a modern fatherhood suggests that, at least, fathers of the younger generation tend to reduce their working hours and thus accept wage reductions. Our focus is on the effect of fatherhood on wage growth, hours worked and interfirm mobility. We find that fathers receive higher wages than married men without children, even when controlling for selection into fatherhood. The positive income effect of fatherhood results from greater on-the-job wage growth. However, fathers are not likely to increase their wage by working longer hours or leaving their current employer for a better paid position.