Millennials and the gender wage gap: do millennial women face a glass ceiling?
| DOI | https://doi.org/10.1108/ER-05-2021-0179 |
| Published date | 27 September 2022 |
| Date | 27 September 2022 |
| Pages | 366-386 |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations,Employment law |
| Author | Gustavo A. García,Diego René Gonzales-Miranda,Óscar Gallo,Juan Pablo Roman Calderon |
Millennials and the gender wage
gap: do millennial women face
a glass ceiling?
Gustavo A. Garc
ıa
Department of Economics, Universidad EAFIT, Medell
ın, Colombia
Diego Ren
e Gonzales-Miranda
Area of Organization, Direction and Strategy, Universidad EAFIT,
Medell
ın, Colombia
Oscar Gallo
Department of History, Universidad de Antioquia, Medell
ın, Colombia, and
Juan Pablo Roman Calderon
Area of Organization, Direction and Strategy, Universidad EAFIT,
Medell
ın, Colombia
Abstract
Purpose –This study aims to measure the gender wage gap among millennial workers in Colombia and
determine if there is a marked wage difference between millennial women and men. Furthermore, this study
analyzes whether millennial women face a glass ceiling, that is, whether there is a larger gender wage gap
among workers earning relatively high wages.
Design/methodology/approach –The study data included a sample of 2,144 millennial workers employed
in 11 organizations located in the five main cities of Colombia. Oaxaca–Blinder econometric methods of wage
decomposition were used to calculate both raw and adjusted gender wage gaps. The latter results in estimating
the gender wage gap while controlling for observable characteristics related to individual, family, and labor. In
addition, wage decompositions by education levels were carried out to approximate the extent of the glass
ceiling among young workers.
Findings –The results show that millennial workers in Colombia face gender inequality in the labor market
and that professional millennial women experience a distinct glass ceiling. The adjusted gender wage gap is
9.5%, and this gap increases with education level, increasing to nearly 14% among college-educated workers.
Research limitations/implications –The empirical results are supported by a self-report survey of
millennial workers. An important limitation is that the data include millennial workers employed in the formal
sector and exclude the informal sector (activities not regulated or protected by the state), which represents an
important part of the economy in developing countries.
Originality/value –This paper contributes to the empirical literature on gender wage inequality for younger
workers. This paper is original in reviewing the gender pay gap in Colombia using a primary dataset. Most of
the work in this area has been done in developed countries and this research adds to the findings that have had
focused on those nations.
Keywords Gender wage gap, Glass ceiling, Millennial workers, Wage decomposition, Colombia
Paper type Research paper
1. Introduction
The wage differential between men and women has narrowed, but a significant gender wage
gap still exists (Blau and Kahn, 2017). Numbers from the Organization for Economic
Co-operation and Development (OECD) indicate that women earned 18% less than men in 2017,
ER
45,2
366
An early version of this article was published as a Working Paper in Garc
ıa, G., Gonzales, D., Gallo, O.,
and ROman, J. (2020). “Millennials and the gender wage gap: Do millennial women face a glass ceiling?”,
Documentos de Trabajo Econom
ıa y Finanzas, No. 20-20, CIEF, Universidad EAFIT, Medell
ın-Colombia.
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/0142-5455.htm
Received 3 May 2021
Revised 28 March 2022
11 July 2022
Accepted 24 August 2022
Employee Relations: The
International Journal
Vol. 45 No. 2, 2023
pp. 366-386
© Emerald Publishing Limited
0142-5455
DOI 10.1108/ER-05-2021-0179
whereasthe differencewas 37% in 1980(OECD, 2021). The narrowing of the gender wage gap is
largely attributable to the fact that younger women are more educated and more likely to
participate in the workforce than prior generations. This change has led to women being
exposed to a greater range of career opportunities and to more progressive norms regarding
working women (Blau and Kahn, 1997,2017;DiPrete and Buchmann, 2006;OECD, 2017).
However, other factors, such as changes in labor market selectivity, changes in gender
differences in unmeasured characteristics, institutional factors (i.e. gender discrimination and
social norms), and less favorable supply and demand shifts, may contribute to the ongoing
gender difference in pay (Rubery and Koukiadaki, 2016;Blau and Kahn, 2017).
After the Great Recession (2008–2010), young workers, particularly those who had
recently entered the workforce (such as millennial workers, also known as Generation Y, or
those born between 1980 and 1999 (Lancaster and Stillman, 2002;Costanza et al., 2012)), faced
a changing labor market. According to ILO (2013) the world youth unemployment rate in
2012 was 12.6%, in developing countries was 17.4% and Latin American countries this rate
was 13.5%, which are approximately twice the overall unemployment rate in each region.
Given the poor macroeconomic performance, young workers are more affected by the long-
term risks of extended unemployment spells, low quality jobs (informality and
underemployment) and low and flat wages. This is because this group of workers usually
has lower job protection and a more severe skill mismatch in the labor market, due to their low
education and training levels (Kahn, 2010;G€
orlich et al., 2013;Novella et al., 2018). These
circumstances affected the economic conditions and well-being of millennial workers and
they also sharpened the differential in wages between men and women and between those
who had high levels of education and those who did not (Bialik and Fry, 2019).
There are several reasons to worry about the gender wage gap in general and among
millennial workers in particular. From an economic point of view, women’s relative
underpayment in organizations can be regarded as inefficient. Women may be equally or
better educated than their male counterparts; therefore, when women are not paid equally to
men, this disparity can lead to lower productivity among women. Ragins and Cornwell (2001)
and Palumbo and Manna (2019) show that lower productivity in the workplace among
women associated with gender-based disparities may happen because women feel
undervalued by the organization, which engenders lower self-efficacy, more emotional
distress, and lower work motivation and commitment. This effect may also be relevant to
millennial workers. Since the millennial generation dominates today’s workforce and plays
vital roles in organizations (Gursoy et al., 2013;Laird et al., 2015;Dechawatanapaisal, 2019),
managers and practitioners need strategies to positively motivate these employees to
increase their productivity and retain them to stay with their employers longer. Therefore,
whether millennial workers have high expectations of gender equality in pay at their
workplace can increase job satisfaction, decrease turnover rates and absenteeism, and
increase organizational commitment, all of which are critical variables to motivate, retain and
attract millennial workers (Freeman, 1978;Campione, 2014;Muskat and Reitsamer, 2020).
From an organizational perspective, it is also essential to study the gender wage gap because
organizations can implement strategies to create an environment of gender equality. In this
respect, several studies highlight that millennial workers tend to focus more on work values,
such as strong ethics, honesty, integrity, diversity and equality (Lyons et al., 2012;Lyons and
Kuron, 2014;Costanza and Finkelstein, 2015;Garc
ıaet al., 2019). Thus,a work environmentwith
more gender equality in pay and participation in work could lead to more attractive and
satisfying jobs for the millennial generation(Real et al., 2010;Muskat and Reitsamer, 2020). For
economic reasons and to manage new generations of workers, it is therefore important to
measure the extent of the gender discrimination facingmillennial workers.
It is also important to address the question of whether millennial women must confront a
“glass ceiling”. To the best of our knowledge, there is little empirical evidence on this issue
Millennials and
the gender
wage gap
367
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