In this section we shall compare the age earnings profiles of full-time women in the
three countries for the four education groups we have distinguished. As we have show in
chapter 1, the relationship between age and earnings was different for women than for
men. There was little variation in earnings with age for women over the age of 30 in each
of these co u n tries.^0)
The earnings of each of the four education groups we have identified; the
unqualified, the high school graduates, those with post secondary qualifications and the
university graduates,were also fairly flat after about age 30. Figures 3.8, 3.9 and 3.10
plot five year moving averages for each of the education groups in each of the three
countries.
Figure 3.8 for Australian women, shows little change in earnings with age for the
unqualified, high school and post secondary groups after their mid 20's. The earnings of
university graduates continued to grow for longer, into their early 30's. There were less
than ten observations at each age for university graduates over the age of 45 and it is
therefore difficult to make any general statement about the shape of the age earnings
profile for older graduates. The average earnings changed quite sharply between one age
and the next, presumably due to sampling variability.
Figure 3.9 shows the relationship betwen age and earnings for the unqualified,
high school and post secondary groups of women in Great Britain. As there were only
58 female graduates working full-time in the British sample, we have been unable to plot
an age earnings profile for this group. While there was little growth in earnings with age
for the unqualified, the earnings of high school graduates grew into their early 30's and
those of women with post secondary qualifications, into their mid 30's. As with the
Figure 3.8: Average Weekly Earnings of Full-time Women by Age and Education, Australia, 1981.
70
. 4 0 0 T Graduates J ’ ’ \ y ' 3 5 0 3 0 0 Post secondary 2 5 0 ■■ $ 2 0 0 " Unqualified 1 5 0 ■■ High school 10 0 ■ ■ 5 0 I I I t i l l i l l I I I I I I I I I I 1 1 1 I I < t - l I l t < i l l I I I I IFigure 3.9: Average Weekly Earnings of Full-time Women by Education and Age, Great Britain, 1981.
1 60 T 1 4 0 ■■ Post secondary 12 0 ■■ High school 1 00 8 0 ■■ Unqualified 6 0 ■■ 4 0 ■■ 2 0 ■■ t t I i I I I I I I i i 1 I I I I I t - f t —t i i i i i i i i i i
Figure 3.10: Average Weekly Earnings of Full-time Women by Age and Education, United States, 1981.
qualifications at each age over 35 was probably the cause of the variability in earnings
with age among these women.
The age earnings profiles of women in each of the four education groups in the US
are presented in Figure 3.10. While there was relatively little growth in earnings with age
for the unqualified, the average earnings of female high school graduates more than
doubled between the ages of 16 to 18 and their early thirties. The earnings of the post
secondary and graduate groups also grew into their early 30's and thereafter remained
fairly constant.
Figure 1.2 chapter 1 showed that in aggregate, the earnings of women appeared to
decline with age much earlier than for men. This decline in earnings with age may reflect
changes in the average educational attainment of each age. So for example, if 25 year
olds are more highly educated than 45 year olds in the cross section, this would give the
impression of declining earnings with age. In order to control for some of these changes
in human capital endowments with age, we present figures 3 .1 1 -3 .1 4 which compare
the age earnings profiles of each education group in the three countries using the earnings
of a woman aged 25 with the relevant education level as the reference point. In these
figures, although the profiles were relatively flat, there was no evidence of the decline in
weekly earnings apparent in the aggregate profile.
Figure 3.11 compares the earnings profiles of unqualified women in each of the
countries. It is useful to consider the graph in two parts; firstly the comparison of relative
earnings of those under 25 and secondly those aged 25 to 64. The earnings of teenage
unqualified women in the US were higher relative to those of a 25 year old than the
relative earnings for this group in Australia and Great Britain. In Australia and Great
Britain, earnings rose into the mid-20's and then did not change with age. In the US the
full-time weekly earnings of unqualified women rose less sharply for those under 25 but
7 2
Figure 3.11: Average Weekly Earnings of Unqualified Women, Australia, Great Britain and the United States, 1981
Earnings of unqualified women aged 25=1. 1. 4 t
1.2 "
0. 8 - ■ A u stralia
0. 4 ■■
+~ + < < < I - I < < I I I I I 1 I I < < I I I < I » I I < < I I « I I I I I 1 I I \ I
Figure 3.12: Average Weekly Earnings of Female High School Graduates, Australia, Great Britain and the United States, 1981.
Earnings of high school graduates aged 25=1. 1 .4 T 1.2 " A ustralia 0 . 8 ■ ■ 0. 4 -, 0 . 2 " I I < < ♦ - < < < 1 < < < < < < < < < < ■ < < < < I t i t I < I I < < I I 1 I 1 + ■■< < t < 1
Figure 3.13: Average Weekly Earnings of Women with Post Secondary Qualifications, Australia, Great Britain and the United States, 1981.
Earnings of women with post secondary qualifications aged 25=1. 1.8 T 1.6 ■ ■ 1. 4 ■■ 1.2 ■ ■ A ustralia 0 . 8 ■■ < < < < I < < < I < < < I < < < < < ♦ -< < < < < < » < ■ ■ < < < < < < I t <■ < ■■<■< < V WV4 1 8 22 3 0 3 4 3 8 4 2 4 6 54 Age 2 6 5 0 58 62
year old woman for the remainder of working life. The average weekly earnings of
women at each age between 59-64 was almost 20 per cent above the average for the US
sample of the unqualified as a whole. There is no immediately obvious explanation of
this fact but perhaps it reflects differences in the retirement behaviour of the more and
less economically successful among the unqualified. The conclusion for the unqualified
is that there was greater overall variation in earnings by age in the US than in the other
two countries for those over 25 but this conclusion did not hold for the under 25's.
A greater variability in earnings for high school graduates was also apparent in the
US compared with Australia and Great Britain (see figure 3.12). The average earnings of
Australian high school graduates doubled between age 16 and 25, after which earnings
did not vary with age. Earnings of British high school graduates also rose substantially
between the ages of 16 and 32, were flat into the late 40's and then rose to a higher
plateau in their 50's. There were a very small number of women with high school
qualifications in their 50's and perhaps not too much weight should be given to this latter
finding. In the US high school graduates average earnings increased three times between
the ages of 16 and 32 but after that did not change much with age.
In each country there were few women in their 50's with post secondary
qualifications so the results presented in figure 3.13 for the older women in this group
should be treated with caution due to the small sample sizes. The picture for Australian
women in this education group aged between 18 and 50 was of small variation in
earnings with age. Eighteen year olds earned about 60 per cent of the earnings of a 25
year old but there was little change in earnings after age 25. Earnings in the US
continued to rise for longer than those in Australia, until age 30, but as in Australia, from
that point, there was little variation in earnings. The British post secondary group
showed the greatest variation in earnings with age. The average weekly earnings of
Figure 3.14: Average Weekly Earnings of Female University Graduates, Australia and the United States, 1981.
Earnings of university graduates aged 25=1.
1.4 t
1.2 "
Australia
0 .4 ■■
I > < t ■ t - 1 I I » « I l I I » I » < f
The small sample size prevented us from plotting an age earnings profile for British
graduates but figure 3.14 shows the relationship between age and earnings for graduates
in Australia and the US, using as a benchmark the earnings of 25 year old graduates. The
US profile shows greater variation in earnings with age than the Australian profile. For
both countries the earnings of female graduates stopped growing with age in their early
30's. Once again the problems of small sample size make the average earnings of women
over 55 rather variable.