Study: When male CEOs have 1st child, workers’ pay suffers

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Did you notice your paycheck got a little smaller after your boss had his first child? A group of researchers says your eyes probably are not playing tricks on you.

The Administrative Science Quarterly is reporting on a study that found male chief executive officers generally pay their employees less money after fathering a child but pays himself more, especially if the child is a male.

Three college researchers studied the salaries of 1.2 million people across 10,600 companies in Denmark from 1996 and 2006 to come up with the findings. In an ASQ abstract, Michael S. Dahl1 of Aalborg University in Denmark, Cristian L. Dezső of the University of Maryland and David Gaddis Ross of Columbia Business School said they conducted the study to see how the transition to fatherhood affects male CEOs’ values.

Male workers took a larger pay cut than women, although the drop overall was around .2 percent, the researchers say. The pay hikes the CEOs gave themselves, however, were more significant, around 5 percent, one of the researchers told Bloomberg Businessweek.

“He has a kid, he thinks immediately, ‘I want more money for my family,’” said Dezsö, assistant professor at University of Maryland’s Smith School of Business. “But it comes at the expense of the employees.” As for pay cuts, Dezsö said women might fare better because of the male CEO’s sudden respect for motherhood.

Since the study was on Danish CEOs and workers, the researchers could only speculate about whether there would be similar findings in the U.S. Dezsö said the pay of U.S. workers might be more vulnerable because the country’s views about gender equality are less liberal than views on equality in Denmark.

“These results are consistent with a desire by the CEO to husband more resources for his family after fathering a child and the psychological priming of the CEO’s generosity after the birth of his first daughter and specifically toward women after the birth of his first child of either gender.”

4 comments Add your comment

Huh?

January 18th, 2013
1:50 pm

Should ANYONE be surprised by this?!!!!

Pamela

January 18th, 2013
2:51 pm

This is a shame! This should be illegal. As if his employees don’t have children or other responsibilities. That is wrong!

Living With Open Eyes

January 18th, 2013
6:11 pm

Companies always look out for their employees interests as long as you keep those dirty unions out.

Wilbur

January 18th, 2013
8:20 pm

.2%. In Denmark. “Reasons” for the data are all speculative.

Could this be more trash “journalism”?