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Rising Top, Falling Bottom: Industries and Rising Wage Inequality

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Listed:
  • John Haltiwanger
  • Henry R. Hyatt
  • James R. Spletzer

Abstract

Most of the rise in overall earnings inequality from 1996 to 2018 is accounted for by rising between-industry dispersion. The contribution of industries is right-skewed with the top 10 percent of four-digit NAICS industries dominating. The top 10 percent are clustered in high-paying high-tech and low-paying retail sectors. In the top industries, high-wage workers are increasingly sorted to high-wage industries with rising industry premia. In the bottom industries, low-wage workers are increasingly sorted into low-wage industries, with rising employment and falling industry wage premia.

Suggested Citation

  • John Haltiwanger & Henry R. Hyatt & James R. Spletzer, 2024. "Rising Top, Falling Bottom: Industries and Rising Wage Inequality," American Economic Review, American Economic Association, vol. 114(10), pages 3250-3283, October.
    • Handle: RePEc:aea:aecrev:v:114:y:2024:i:10:p:3250-83
    DOI: 10.1257/aer.20221574
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    More about this item

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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