Recent Changes in British Wage Inequality: Evidence from Firms and Occupations

Schaefer, Daniel; Singleton, Carl

doi:10.2139/ssrn.2816868

Cited by 3 publications

(4 citation statements)

References 35 publications

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“…Past findings that support this includeSong et al (2015) for the United States,Card, Heining and Kline (2013) for Germany,Håkanson, Lindqvist and Vlachos (2015) for Sweden,Borovičková and Shimer (2017) for Austria,Schaefer and Singleton (2016) for the United Kingdom, and Alvarez, Engbom and Moser (2015) for Brazil.8 I observe data on establishments, rather than firms, meaning two Starbucks would be considered separate entities. It is not possible in these data to aggregate the establishments into their parent firms.…”

mentioning

confidence: 89%

Firms as Learning Environments: Implications for Earnings Dynamics and Job Search

Gregory¹

2020

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This paper demonstrates that heterogeneity in firms' promotion of human capital accumulation is an important determinant of life-cycle earnings inequality. I use administrative micro data from Germany to show that different establishments offer systematically different earnings growth rates for their workers. This observation suggests that that the increase in inequality over the life cycle reflects not only inherent worker variation, but also differences in the firms that workers happen to match with over their lifetimes. To quantify this channel, I develop a life-cycle search model with heterogeneous workers and firms. In the model, a worker's earnings can grow through both human capital accumulation and labor market competition channels. Human capital growth depends on both the worker's ability and the firm's learning environment. I find that heterogeneity in firm learning environments account for 40% of the increase in cross-sectional earnings variance over the life cycle, and that this mechanism is especially important for young workers. I then show that differences in labor market histories partially shape the worker-specific income profiles estimated by reduced-form statistical earnings processes. Finally, because young workers do not fully internalize the benefits of matching to high-growth firms, changes to the structure of unemployment insurance policies can incentivize these workers to search for better matches.

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confidence: 89%

Firms as Learning Environments: Implications for Earnings Dynamics and Job Search

Gregory¹

2020

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“…This period also included the 2007-08 financial crisis and a deep recession. Following 2008 there was a fall in British employee wage inequality, though there was also an increase in the variance of firm average wages (Schaefer and Singleton, 2017). For firms and employees who remained economically active during and since the financial crisis, the downturn could have systematically affected the wages they paid and received.…”

Section: Before and After The 2008/9 Recessionmentioning

confidence: 99%

“…3 Specifically for the United Kingdom, Faggio et al (2010) found that large increases in earnings inequality throughout the 1980s and early 1990s were driven by increasing dispersion in the average wages paid by firms. Although Mueller et al (2017) and Schaefer and Singleton (2017) have since described how the majority of British wage inequality in the past two decades still lies within firms, nonetheless, a sizeable fraction is accounted for by between-firm differences. In this paper, we ask what role firm-specific wage premiums have in accounting for the UK gender pay gap.…”

Section: Introductionmentioning

confidence: 99%

Who Works for Whom and the UK Gender Pay Gap?

2018

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This study reports novel facts about the UK gender pay gap. We use a large, longitudinal, representative and employer-employee linked dataset for the years 2002-16. Men's average log hourly wage was 22 points higher than women's in this period. We ask how much of this gap is accounted for by the differences in whom men and women worked for; how much is explained by the relative wage premiums that firms paid their employees, after adjusting for the influence of other factors, such as occupations and tenure? The answer is less than 1 percentage point, or about one eighteenth of the adjusted hourly gender pay gap. We also find that the allocation of men and women to occupations was as unimportant as how workers were allocated to firms. These results show that in the United Kingdom what happens within firms and occupations is far more important than what jobs men and women have. Therefore, attention should focus on why men and women within UK firms tend to receive different rates of pay.

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“…In another paper we use a combination of the exact number of employees, 4-digit industry classification and information on the legal status of an enterprise to define the boundaries of larger firms within each year back to 1996 (Schaefer and Singleton, 2017). But, here we want to link firms longitudinally before and after 2003.…”

Section: The Annual Survey Of Hours and Earnings And Other Data Usedmentioning

confidence: 99%

Real Wages and Hours in the Great Recession: Evidence from Firms and Their Entry-Level Jobs

Schaefer

Singleton

2017

SSRN Journal

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Recent Changes in British Wage Inequality: Evidence from Firms and Occupations

Cited by 3 publications

References 35 publications

Firms as Learning Environments: Implications for Earnings Dynamics and Job Search

Firms as Learning Environments: Implications for Earnings Dynamics and Job Search

Who Works for Whom and the UK Gender Pay Gap?

Real Wages and Hours in the Great Recession: Evidence from Firms and Their Entry-Level Jobs

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