The Decline of Sex Segregation and the Wage Gap, 1970-80

This study makes use of 1970 and 1980 Census of Population employment and earnings data at the detailed occupation and industry level to examine changes in the distribution of the U.S. work force by sex and to assess their impact on relative female earnings. First, we find clear evidence that both occupational segregation and industrial segregation declined during these years. Second, high employment growth within an occupation is associated with declines in segregation. Third, declines in industry segregation within occupation are associated with improvements in relative female earnings independently of other factors which affect relative pay. Fourth, high employment growth is associated with improvements in relative female earnings, independently of its effect on occupational segregation. As a result, employment growth acts to reduce the wage gap directly, possibly by lowering barriers to women finding jobs at high wage firms, and also indirectly by lowering the degree of industrial segregation. These results thus suggest that barriers or discrimination against women tend to be lower in sectors where demand is strong.