Part-time wage penalties in Europe

Working Paper 2012-250

Abstract

Different profiles of female participation and part-time employment can be observed within Europe. The aim of this paper is to estimate whether there still exists a wage penalty for part-time workers in four European countries (i.e. Austria, Italy, Poland, and the United Kingdom) after the introduction of Council Directive 97/81/EC concerning the Framework Agreement on part-time work and aiming at eliminate any form of discrimination against part-time workers. Full-time hourly wages exceed part-time hourly wages in all countries. Several explanations can be found in literature: different characteristics of part-time and full-time workers in terms of human capital accumulation, preferences, level of union membership, etc. Also the presence of discrimination against part-time workers within firms can explain this positive wage gap. However the magnitude of these explanations may differ between countries. Using the EU-SILC for the year 2009, we study the full-time/part-time pay differential focusing on the contribution of segregation and selection in explaining the observed positive wage gap. Results show that segregation matters in explaining the full-time/part-time wage gap. We find also evidence of a significant part-time wage premium in Austria and Poland once we control for sample selection.

Authors: Eleonora Matteazzi, Ariane Pailhé , Anne Solaz .