In this paper we explore annual earnings as well as full-time monthlyearnings differentials resulting from sexual orientation. We observe that gay malesare at an earnings disadvantage compared to male heterosexuals regardless of whichearnings measure we use. This earnings disadvantage is found to be larger when wecompare gay and heterosexual males who are working full-time. In addition, thedisadvantage is larger in the private than in the public sector. Lesbians, however,earn more than heterosexual females. This earnings advantage is considerablysmaller when we study full-time monthly rather than annual earnings but an earningsadvantage for lesbians at the top of the earnings distribution is documentedregardless of which earnings measure we use. In addition, lesbians are doing betterthan female heterosexuals in the public sector. To sum up, the results indicate thatgay males face obstacles on the labor market that hinder them from reaching toplevelpositions and high earnings. The earnings advantage observed for lesbians islikely to stem from the fact that lesbians devote more time to market work thanheterosexual females.