What is happening to earnings inequality
and youth wages in the 1990s?
by Garnett Picot
Business and Labour
Market Analysis Division
Analytical Studies Branch research paper series, No.
116
The increase in earnings inequality among men in particular in Canada
has been well documented. This paper adds to our knowledge of inequality trends
by addressing three issues.
First, what has happened to earnings inequality
among the employed population in the 1990s? We find that earnings inequality and
polarization increased little in the population of all workers (men and women
combined) between the mid-1980s and mid-1990s.
The second question relates
to the impact of the changing propensity of Canadians to hold a job on earnings
inequality. Put another way, if we focus on the entire population of working age
Canadians (those with and without paid employment), what are the inequality trends?
We find that earnings inequality among the working age population changed little
over the 1980s and 1990s. This analysis incorporates both the influence of the
changing employment/population ratio and inequality trends among employed workers
on overall earnings inequality among the working age population.
But does
this relative stability in overall earnings inequality since the mid-1980s mask
a number of offsetting underlying trends? Some groups of workers are making earnings
gains (notably older workers, and women) while others are losing (notably younger
workers and men). This paper also focuses on the earnings trends among younger
workers, and finds that the decline in annual earnings of younger male workers
in particular is associated with a decline in real hourly wages.
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the full publication.
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