Decomposing growth in the gender wage gap in urban China: 1989-2011

This paper examines trends in the gender wage gap observed in urban China during the post-reform era. Using China Health and Nutrition Survey data, changes to the gap between 1989 and 2011 are analyzed using the Wellington decomposition method. While women's gains in observed characteristics have narrowed the wage gap, they are more than offset by changes in the returns to these characteristics. Men's returns to potential labour market experience have grown particularly rapidly, relative to women's, and this represents the single largest contributing factor towards the widening of the gender wage gap. Further investigation explores gender wage patterns through the dimensions of occupation, ownership sector and birth cohort. Taken together, my results raise concerns that China's urban labour market may increasingly disincentivize women's long-term labour force attachments.