Specialized human capital, occupational sex-segregation and wages. Evidence from the British labour market

Research has consistently demonstrated a negative and statistically significant relationship between occupational feminization and wages in industrialized countries. In the absence of an empirically supported alternative, pay differences between male- and female-dominated occupations have traditionally been attributed to societal mechanisms which have historically undervalued the work mainly performed by women. In recent years, empirical evidence from the United States and Europe has supported human capital theories based on skill specialization. However, these have yet to be tested in the contemporary British context. In this article we examine whether lower wages in female-dominated occupations in Britain can be explained by differences in specialized human capital, allowing for other potentially mediating observable and unobservable factors. We also explore the functional form of the relationship between occupational feminization and wages and estimate the contribution of occupational sex-segregation to the gender gap in wages. The analysis consists of ordinary least squares and longitudinal fixed effects models estimated using recent data from the British Household Panel Survey and the UK Labour Force Survey. Preliminary results suggest a non-linear, strong and negative relationship between occupational feminization and wages. The inclusion of unobservables and measures of specialized human capital approximates the relationship to the linear prediction, but fails to eliminate the wage penalties associated with female-dominated occupations