Motherhood penalty (~33%). Research summarized by NBER shows parenthood leads to a persistent drop in women’s employment and earnings relative to men (≈25% and ≈33% respectively). Source: “Child Penalties and Gender Inequality” (NBER Reporter, 2022).
Citation: Parenthood reduces female employment by 25% and female earnings by 33% relative to males. (Kleven et al.).
Career-break re-entry penalty (~7% first year). Evidence from longitudinal studies finds an initial wage hit after long breaks that may fade over several years; we model men’s recovery over ~5 years. (Speiser, 2021).
Additional re-entry penalty for mothers. Audit and meta-analytic work show lower perceived competence & commitment for mothers and larger across-employer penalties; we model an additional 10% headwind on return, decaying over ~8 years. (Harvard Kennedy School summary of Correll et al.; Demography studies on across-employer penalties).
Childcare costs (defaults). 2025 averages: daycare ≈ $343/wk; nanny ≈ $827/wk; au pair ≈ $28,200/yr (~$404/wk + room, board, utilities, education). (Care.com 2025 Cost of Care; GoAuPair; Au Pair in America).
You can change every coefficient above if you prefer more conservative or more aggressive assumptions.
Sources: NBER Reporter (2022); Care.com Cost of Care (2025); Harvard Kennedy School (Motherhood Penalty summary); Demography (Motherhood penalties & fatherhood premiums); GoAuPair pricing; Au Pair in America.
