New Evidence on Gender Difference in Promotion Rates: An Empirical Analysis of a Sample of New Hires

Abstract

Using a large sample of establishments drawn from the Multi-City Study of Urban Inequality (MCSUI) employer survey, we study gender differences in promotion rates and in the wage gains attached to promotions. Several unique features of our data distinguish our analysis from the previous literature on this topic. First, we have information on the wage increases attached to promotions, and relatively few studies on gender differences have considered promotions and wage increases together. Second, our data include job-specific worker performance ratings, allowing us to control for performance and ability more precisely than through commonly-used skill indicators such as educational attainment or tenure. Third, in addition to standard information on occupation and industry, we have data on a number of other firm characteristics, enabling us to control for these variables while still relying on a broad, representative sample, as opposed to a single firm or a similarly narrowly-defined population. Our results indicate that women have lower probabilities of promotion and expected promotion than do men but that there is essentially no gender difference in wage growth with or without promotions.