Buckberg, E. and A. Thomas, “Wage Dispersion and Job Growth,” in United States - Background Papers (SM/94/223, August 18, 1994), Chapter 11, pp. 152–166.
Buckberg, E. and A. Thomas, “Wage Dispersion and Job Growth in the United States,” Finance and Development (Washington: International Monetary Fund, June 1995).
Farber, H., “Are Lifetime Jobs Disappearing? Job Duration in the United States: 1973-1993,” NBER Working Paper No. 5014 (February 1995).
Gera, S. and G. Grenier, “Interindustry Wage Differentials and Efficiency Wages: Some Canadian Evidence,” Canadian Journal of Economics (February 1994).
Krugman, P., “Past and Prospective Causes of High Unemployment,” in Reducing Unemployment: Current Issues and Policy Options, Proceedings of a Symposium organized by the Federal Reserve Bank of Kansas (Kansas City 1994), pp. 68–81.
Markusen, A. and M. Oden, “Regional Adjustment of Defense Dependent Regions in the Post-Cold War Era,” OECD Working Paper (1994).
Nickell, S. and B. Bell, “Changes in the Distribution of Wages and Unemployment in OECD Countries,” American Economic Review Papers and Proceedings of the 108th Annual Meeting of the American Economic Association (May 1996), pp. 302–309.
Saunders, N., “U.S. Defense Related Employment Retrenches,” Issues in Labor Statistics, U.S. Bureau of Labor Statistics (May 1995).
United States Congressional Budget Office, “Re-employing Defense Workers: Current Experiences and Policy Alternatives,” Congressional Budget Office Papers (August 1993).
United States Council of Economic Advisers, “Job Creation and Employment Opportunities: The United States Labor Market, 1993-1996,” (April 1996).
See U.S. Congressional Budget Office (1993).
This hypothesis has been recently criticized by Nickell and Ball (1996) who find that the difference in unemployment between high educated and low educated workers is similar in the United States and in Europe over the 1971-93 period.
Wages are examined for all one- and two-digit industries, except for agriculture, mining, and government. The data for 1980 and 1994 were obtained from payroll records analyzed by the Bureau of Economic Analysis, whereas the data for 1984 were obtained from Krueger and Summers’ analysis of the Current Population Survey (see Krueger and Summers (1986)).
The rise in the wage for legal and other services has contributed to the improvement in the relative wage in the service sector noted above.
The employment data come from the establishment survey. Establishment survey data, rather than household survey data, are used because a modification was introduced into the household survey data in early 1994 that makes comparisons to earlier data extremely difficult. The establishment survey, however, does not distinguish between full-time and part-time work.
Although the wages in the services sector have risen relative to the economy-wide average on account of the large rise in the wage differential in legal and other services, most of the employment gains in the services sector have occurred in relatively low-wage service industries (see Table 2).
The employment totals for 1980-90 and 1990-95 are not strictly comparable because the SIC code change in 1987 introduced new two-digit industry categories for deposit and nondeposit institutions, motion pictures, amusement and recreation services, and engineering and management services. These categories are included in the calculation of employment gains over the 1990-95 period but are not included in the calculation for the 1980-90 period.
This is consistent with a recent report by the Council of Economic Advisers that the majority of employment gains over the most recent period were in high wage industries. In particular, the report notes that 68 percent of the net growth in full-time employment between February 1994 and February 1996 was found in job categories paying above-median wages.