New research on the motherhood penalty – and how accountants can help

Research from across the world shows that mothers earn less over the course of their careers than fathers and less than women without children.

This is known, shorthand, as the “motherhood penalty”.

Last year, a new study examined the problem from another perspective, delving into the impact of motherhood on job quality.

Here, we investigate the meaning of the motherhood penalty, dig into the study’s findings – and look at what accountants and SMEs can do to help.

What we already knew about the motherhood penalty

The aim of the study was to build on what global research has already proven.

“The motherhood penalty describes the well-evidenced negative impact of becoming a parent on women’s earnings over time,” says Rose Cook, Senior Research Fellow, Global Institute for Women’s Leadership, King’s College London.

“Research shows that men and women have very different earnings growth, even when they were previously on the same career trajectory, or earned the same, before having children.

“This is also found when comparing mothers to their male partners and to fathers more generally.”

Over time, the motherhood penalty contributes to multiple economic inequalities between men and women, including in wealth, savings and pensions.

In contrast, men who become fathers often receive better pay and more opportunities.

The study: Goal, scope and findings

“We wanted to explore whether the motherhood penalty applies to the experience of work in the same way as pay,” says Cook.

“As well as earning less, do mothers generally have a poorer experience?”

Cook, along with researchers Sara Connolly, Professor of Personnel Economics, University of East Anglia, and Laura Jones, Research Associate, Global Institute for Women’s Leadership, King’s College London, investigated the kinds of jobs women with children do, and how these jobs compare with those of fathers, and women without children.

In defining “job quality”, the trio developed a 12-point framework, which included work-life balance, working hours, control over day-to-day tasks, benefits, training opportunities and promotion prospects – then applied it to data from 15,877 employees questioned in the UK Household Longitudinal Survey.

The results were concerning.

“We found a clearcut motherhood penalty in job quality,” says Cook.

“Mothers are significantly under-represented in high-quality jobs – those with attributes including good work-life balance, control over working hours and control over job tasks.”

Meanwhile, jobs with more control are more likely to score poorly on access to training and career prospects.

Further, the penalty worsens by the time children are at school.

“Mothers of school-age children, in particular, are more likely to work in poor quality jobs,” says Cook.

The reasons for these findings

The main reason for the findings is that so many mothers work part-time.

“We found that, [in addition] to mothers of school-aged children, those with part-time jobs were particularly likely to have poor quality jobs and the types of jobs that combine flexibility with poor career progression,” says Cook.

“This underscores the need to improve the quality of part-time jobs, and the ability for people to reintegrate back into their careers and progress while working part-time.

“It also underscores the constraints placed on many women due to school and childcare hours, and women typically being the ‘default parent’ due to unequal gender roles at home, which can limit their ability to access meaningful and rewarding work.”

How accountants can help correct the motherhood penalty

Accountants can start by analysing how the motherhood penalty is affecting a business’s employees.

“We review our client’s payroll data, and provide them with annual statistical reporting on things such as gender splits and pay gaps,” says Kelly Davies, Partner, Westcotts Chartered Accountants and Business Advisers.

From there, it’s important to try to determine the reasons for any inequalities. This should include auditing policies regarding, and support for, working parents, says Helen Sachdev, Founder, WOMBA (Work, Me and the Baby).

“Honestly assessing the gap between expectations and declarations made, and the reality for working parents on the ground, is essential to [making] a real difference.”

Next, accountants can work with SMEs to help them develop strategies to counter the motherhood penalty.

Top of the list should be rebooting the business’s approach to flexibility, so it works for mothers.

“[This means] allowing families to work around their childcare needs, as well as ensuring the business thrives,” says Davies.

“We look at how [flexible working hours and contracts] could impact [a business’s] figures, attract talent and help them grow.”

“A structured hybrid working model – one that integrates in-person presence, and ensures parents can calibrate home and career in a way that works for them – will ensure working parents feel supported, and still have opportunities to be seen and heard among management and senior leadership,” says Sachdev.

This may include replacing part-time roles with job sharing. “[This] is a great opportunity for working parents to maintain a work-life balance, while being in a role that matches their skillset and seniority, and adding value to the organisation,” says Sachdev.

True flexibility would also ensure that part-time work isn’t a barrier to promotion.

“The link between long, full-time hours and career progression needs to be severed,” says Cook. “This would benefit both women and men.”

In addition to reconsidering flexibility, accountants should support SMEs to enhance parental leave.

“Statutory Maternity Pay (SMP) as well as Statutory Paternity Pay (SPP) can be up to a maximum of £172.48 per week, depending on your circumstances,” says Davies.

“In many cases, this is a large reduction in net pay, so any way the employer can assist with plugging that gap is a positive step forward.”

“Plugging the gap” might include increasing maternity leave, by paying new mothers their full salary for a fixed period on top of SMP, as well as increasing paternity leave, to give families more options.

A phased return to work could also help. “[This] can allow a parental leave returner to set themselves up,” says Sachdev.

“One of the leading construction companies in the UK is helping to prevent a blunt transition back to the workplace with a phased policy – 100% pay for 80% of the hours for the first six weeks.”

Upon return, parents might benefit from HR-driven initiatives. Coaches can help with navigating the transition from worker to working parent, boosting confidence, leading conversations with managers, developing healthy boundaries and learning effective time management.

“As accountants, we can guide our clients, provide them with ideas and share with them the experiences we encounter with other clients to help them achieve their goals,” says Davies.

“We can’t, however, provide them with HR advice, so we encourage our clients, especially small businesses, to gain the help and expertise of HR professionals.”