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Wilfrid Laurier University School of Business & Economics
November 22, 2014

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2003-05 EC: Changes in Wages and Hours of Workers in Different Skill-Groups in the U.S. and Canada from 1981 to 1997 (Working Paper)


Johnson, S., & Kuhn, P.

published: 2003 | Research publication | Working Paper - Economics

ABSTRACT This paper looks at changes in wages and hours of workers in different skill-groups in the U.S. and Canada from 1981 to 1997. The analysis reveals that increases in hourly wage inequality are primarily responsible for increases in earnings inequality in both countries. High-skilled workers experienced increases in earnings growth due to increases in hours and, at least for the U.S., increases in wages. In contrast, low-skilled workers experienced declines in earnings growth due to decreases in wages and hours. In Canada a larger percentage of the reduction in earnings of low-skilled workers is accounted for by declining hours. This evidence is consistent with a higher degree of downward wage rigidity in Canada than in the U.S.

JEL: J31-Wage level and structure; wage differentials by skill

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