Reconciling the divergence in aggregate U.S. wage series

Abstract

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Labor Reallocation, Employment, and Earnings: Vector Autoregression Evidence

“…It is well‐known that measures of employment from different data sources move together more strongly than measures of worker earnings, see Abraham et al . () and Champagne and Kurmann (). Therefore, we estimate alternative VAR models in which we replaced LEHD earnings with CES average earnings for production and nonsupervisory workers, which is the longest continuously available earnings measure for the USA.…”

“…These data sources have substantial differences that have been the subject of many studies, discussed in Abraham et al . () and Champagne and Kurmann (). We also wish to highlight trends in earnings in the LEHD data, which is an administrative records source.…”

“…The LEHD database offers one such real earnings series, but we also consider sources from the CES and the CPS as well, as sensitivity checks for our analysis. These data sources have substantial differences that have been the subject of many studies, discussed in Abraham et al (1998) and Champagne and Kurmann (2017). We also wish to highlight trends in earnings in the LEHD data, which is an administrative records source.…”

The importance and challenges of measuring work hours

“…There is evidence that the relative business cycle volatility of the hours series has changed since 1984-the approximate beginning of the Great Moderation, when GDP exhibited significantly less cyclical volatility [11]. CPS and CES production and nonsupervisory worker weekly hours series became less volatile after 1984, while OPT hours series became slightly more volatile.…”

“…The analysis and conclusions expressed in this article are those of the authors and do not necessarily reflect those of the US Bureau of Labor Statistics. Version 2 of the article updates the text to include the BLS's fourth weekly-hours series and adds two new "Key references" [8], [11].…”