The effect of maternity on employment and wages in Mexico

We estimate child penalties in the Mexican formal labour market at the aggregate level and for specific population subgroups. We use longitudinal administrative data for formal workers. The child penalty begins immediately with pregnancy. Six years after childbirth, the average penalty is 24% on wages and 16% on the rate of formal employment for women who are mothers. The penalties are greater for mothers who are married, poor, or young. The wage penalty increases over time.