Gender Differences in Employment Patterns by Firm Size and Wage Inequality

Myungho Paik, University of Texas at Austin

I examine the firm size selection behavior of workers and firms' employment patterns by size in the United States. Using the Current Population Survey, I find that the fraction of workers who are employed by large firms has steadily increased between 1987 and 2001, and that, more interestingly, the changes in firm size distribution show completely different trends by gender. While the fraction of female workers who are employed by large firms has increased gradually, that of male workers has hardly changed over time. These differences are not fully explained by changes in the distribution of demographic and job characteristics. I also find that the gender differences in size-wage premia of workers in large firms decline continuously over the period. Using these results, I show that a part of gender wage convergence is explained by the changes in firm size distribution and size premia.