How the boss's baby affects your salary
Just when you think there were no more areas of work to study, a new study has just come out that ties a CEO’s new baby to your salary.
Sounds farfetched, but Economics professor Michael Dahl of Aalborg University, Columbia Business School professor David Gaddis Rose and Professor Cristian Dezso of the University of Maryland Smith School of Business have found relationships between the birth of a CEO’s baby and your wages.
What did they find out? If you’re a woman, then your CEO’s newborn is good for your bank account.
According to the Wall Street Journal, when a male CEO has a baby, salaries can, in general, shrink by 0.2 per cent or $100 per year. Worst yet, salaries can shrink by 0.4 per cent if the baby is a boy.
On the other hand, should the CEO and his partner have a daughter, specifically a first-born daughter, salaries go up. Women’s salaries go up by 1.1 per cent while the men’s wages go up by 0.6 per cent.
If the baby (not necessarily the first born) is a boy, women still benefit, in the sense that their salaries don’t drop as much as men’s. Their salary shrinks by 0.2 per cent while men’s salaries drop by 0.5 per cent. If the baby boy is the first-born for the CEO and his partner, women’s salaries go up by 0.8 per cent.
The paper was presented on January 4th at the American Economics Association annual meeting. The study looked at 18,000 male CEOs at 10,655 private companies in Denmark between 1996 and 2006. There were nearly 1,600 births to the participating CEOs.