Female Workers and Firms’ Productivity and Wages

While it is generally agreed that reducing the gender wage gap is desirable, depending on what is causing the gap, different measures would be appropriate in addressing the issue. This study measures the relationships between firms’ compositions of workers, productivity and wages―the “productivity-wage gap”―using panel data from 2015 to 2021 constructed from an original survey of Japanese firms linked with the Basic Survey of Japanese Business Structure and Activities. The result indicates that first, on average, female workers’ wages are not lower relative to their contribution to firm productivity. Second, we do not find that female workers’ wages are higher relative to productivity in firms with labor unions or female directors on their boards. Third, wages of part-time workers are not lower relative to their productivity. Fourth, wages of highly educated workers are lower relative to their productivity. Fifth, when firm fixed-effects are controlled, the productivity-wage gap for female workers and highly educated workers cannot be estimated, indicating that unobserved firm characteristics are behind the gap as observed cross-sectionally.

The English version of this paper is 25-E-008.