Australia’s Treasury Department has published their research on how children affect the earnings of men and women in Australia. The authors use HILDA survey data to show the arrival of children has a large and persistent impact on the gender pay gap, reducing female earnings by 55% on average in the first 5 years of parenthood.

Personal income tax data shows this gap improves only slightly but remains high in the 10 years following the arrival of children. The authors attribute the gap to lower participation rates and reduced working hours amongst mothers. Although the decline in earnings for women is very similar regardless of their breadwinner status in the household pre-children, women with greater access to workplace flexibility are more likely to remain employed after having children.