Interrupted Work Careers: Depreciation and Restoration of Human Capital
Abstract
The quantitative effects and even the existence of a "human capital depreciation" phenomenon have been a subject of controversy in the recent literature. Prior work, however, was largely cross-sectional and the longitudinal dimension, if any, was retrospective. Using longitudinal panel data (on married women in NLS) we have now established that real wages at reentry are, indeed, lower than at the point of labor force withdrawal, and the decline in wages is greater, the longer the interruption. Another striking finding is a relatively rapid growth in wages after the return to work. This rapid growth appears to reflect the restoration (or "repair") of previously eroded human capital. The phenomenon of "depreciation" and "restoration" is also visible in data for immigrants to the United States. However, while immigrants eventually catch up with and often surpass natives, returnees from the non-market do not fully restore their earnings potential.
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Motherhood breaks come with an additional penalty due to forgone experience-related earnings increases and skill depreciation.
“motherhood breaks come with an additional penalty due to forgone experience-related earnings increases (see, e.g., Caucutt et al. 2002, Adda et al. 2017) and skill depreciation (Mincer & Ofek 1982, Blackburn et al. 1993).”
From Fertility in High-Income Countries: Trends, Patterns, Determinants, and Consequences (2024) · cites this paper as Mincer & Ofek 1982
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Fertility in High-Income Countries: Trends, Patterns, Determinants, and Consequences
Bloom, D. E., Kuhn, M., & Prettner, K. (2024) · Annual Review of Economics · doi:10.1146/annurev-economics-081523-013750 · Cited by 42 · see citing works
Fertility in High-Income Countries: Trends, Patterns, Determinants, and Consequences
Bloom, D. E., Kuhn, M., & Prettner, K. (2023) · doi:10.2139/ssrn.4597716 · Cited by 9 · see citing works
- Authors
- Mincer, J., & Ofek, H.
- Venue
- The Journal of Human Resources
- Publisher
- JSTOR
- Published
- 1982
- Volume
- 17
- Issue
- 1
- Pages
- 3
- ISSN
- 0022-166X (ISSN-L)
- OpenAlex
- W1586816589
- Cited by
- 732
- References
- 0
- Citations by year
- 2026: 6 · 2025: 8 · 2024: 20 · 2023: 26 · 2022: 19 · 2021: 15 · 2020: 21 · 2019: 25 · 2018: 19 · 2017: 22 · 2016: 27 · 2015: 27 · 2014: 30 · 2013: 20 · 2012: 30
- FWCI
- 32.41
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- The Journal of Human Resources (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Labor market dynamics and wage inequality
- Social Sciences › Gender Studies › Gender, Labor, and Family Dynamics
- Social Sciences › Sociology and Political Science › Migration and Labor Dynamics
- Keywords
- human capital depreciation, labor force withdrawal, wage decline, wage growth, married women, immigrants, non-market work
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