Media Briefings

VOLUNTEERING BOOSTS YOUR FUTURE PAY – BUT MEN BENEFIT MORE THAN WOMEN

  • Published Date: April 2014

Working for free to help others substantially increases an individual’s future earnings – but men benefit up to 22% more from having volunteer experience than women, an indication of gender discrimination in the market for former volunteers. These are among the findings of research by Guido CozziNoemi Mantovan and Robert Sauer, to be presented at the Royal Economic Societys 2014 annual conference.

 

Analysing data from the British Household Panel Study, which follows adult men and women in the UK for more than a decade, the researchers find that:

 

The increase in average annual wages from having volunteer experience varies between 64% and 94% for men. For women, the increase in average annual wages is in the range of 42% to 88%.

 

The difference in the wage returns to volunteering accounts for roughly 24% of the overall gender wage gap. The payoff to volunteer experience is a more important factor in explaining the relative underpayment of women than is differences in education levels between the sexes.

 

The researchers argue that the large wage returns to volunteering for both men and women mostly derive from a form of signalling. Working for free to help others signals certain positive characteristics and skills to prospective employers: volunteers’ social concerns are likely to be productive in the workplace. Working for free also enablesthem to broaden their networks and accumulate new skills.

 

The authors comment:

 

The considerable individual and social returns to working for free suggests that policy-makers would be well advised to encourage volunteer work vigorously.

 

‘Policies that had the effect of reducing the cost of volunteering relatively more for women would also help narrow the gender wage gap.

 

More…

 

When you work for free to help others in society, does it also increase your own future earnings? This research suggests that it does, and the increase in ones lifetime earnings can be substantial. Somewhat disconcertingly however, men benefit up to 22% more from having volunteer experience than women. The study suggests that there may be gender discrimination in the market for former volunteers.

 

Using data from the British Household Panel Study, which follows adult men and women in the UK for more than a decade, the research finds that the increase in average annual wages from having volunteer experience varies between 64% and 94% for men. For women, the increase in average annual wages is in the range of 42% to 88%.

 

Surprisingly, the lower wage return to volunteering for women explains a relatively large proportion of the overall gender wage gap. This has rarely been documented and shown so clearly. The difference in the wage returns to volunteering accounts for roughly 24% of the gap. The differential payoff to volunteer experience is a more important factor in explaining the relative underpayment of women than is differences in education levels between the sexes.

 

The study argues that the large wage returns to volunteering for both men and women mostly derive from a form of signalling. Working for free to help others in society signals certain positive characteristics and skills to prospective employers. Roughly 60% of volunteers in the UK declare that they want to improve things and help others, and these social concerns are likely to be productive in the workplace.

 

Moreover, working for free enables individuals to broaden their networks and accumulate new skills. This may help explain why volunteering in the UK and many other countries is not a marginal phenomenon. In England, Wales and Scotland, 18% of men and 21% of women report having engaged in volunteer work during the past year.

 

In searching for the source of the lower wage returns to volunteering for women, the study examines additional data on volunteering contained in the UK Citizenship Survey. The authors fail to find substantial gender differences in the types of chosen volunteer organisations, activities, motivations or sources of volunteering satisfaction. This increases the plausibility that there is an element of gender discrimination in the market for volunteers.

 

The authors also note that volunteering can be a costly activity, especially for women with children. About 50% of women claim they do not volunteer because they care for their children or home. Extra childcare expenses when volunteering may be a deterrent to more volunteering and pro-social activities. Therefore, public policy could have an influence.

 

In particular, a public policy that focused on lowering the cost of childcare, either through increased competition in the childcare market, or perhaps additional childcare tax credits for volunteers, could increase the number of individuals engaging in pro-social behaviour. The authors argue that there would also be an increase in the proportion of high-skilled individuals working for free as a result of such a policy.

 

The main implications are that a lower cost of volunteering would have an especially large payoff for both the individual and society. A policy that had the effect of reducing the cost of volunteering relatively more for women would also help narrow the gender wage gap. The considerable individual and social returns to working for free suggests that policy-makers would be well advised to encourage volunteer work vigorously.

 

ENDS

 

 

Notes for editors:

Does it Pay to Work for Free? Wage Returns and Gender Differences in the Market for Volunteers by Guido Cozzi (St Gallen)Noemi Mantovan (Bangor) and Robert Sauer (Royal Holloway)

 

For further information, contact:

Robert Sauer, robert.sauer@rhul.ac.uk, +44 (0) 1784 443910

Noemi Mantovan, n.mantovan@bangor.ac.uk, +44 (0) 1248388081

Guido Cozzi, guido.cozzi@unisg.ch+41 (0) 71 224 23 99

Romesh Vaitilingam: romesh@vaitilingam.com, +44 7768 661095