After several decades of remarkable stability, the U.S. gender wage gap began to narrow substantially after about 1980 (e.g. Blau and Kahn 2000). A well known explanation of this fact is based on changes in women’s labor market experience (e.g. Goldin 1989; O’Neill and Polachek 1993). Simply put, this “experience” hypothesis argues that because earlier generations of women experienced more frequent labor market interruptions, their earnings tended to fall behind the earnings of men in their cohort as they aged. According to this hypothesis, this rate of “falling behind” should be less severe among later generations of women, who accumulate experience at almost the same rate as their male counterparts.
While some studies do present descriptive statistics that allow cohorts to be followed over time (e.g. O’Neill and Polachek 1993, Table 2; Blau and Kahn 2000, Table 1), existing analyses of the recent rise in women’s relative earnings have concentrated most of their attention on the earnings premium associated with (actual or potential) experience across a series of cross section regressions. Most recently, O’Neill (2003) has shown dramatic evidence of changes in the slope of this cross-sectional relationship. At the same time, direct and detailed examination of the within-cohort relative wage growth experience of women, especially since the 1980’s “takeoff” of women’s relative earnings, has been surprisingly rare.