Wage Growth Distribution and Changes over Time: 2001-2018
Guyonne Kalb, Jordy Meekes
The Australian Economic Review | Wiley | Published : 2021
We explore how much wage growth varies among Australian employees and how it has changed over the 2001– 2018 period. The results show that, after increasing between 2002 and 2007, wage growth significantly slowed post 2008, and particularly from 2013 onwards, returning to early 2000s levels. Employee age, education, employment contract, occupation and industry explain a large share of differences in wage growth between individuals. Employee occupation is more important post-2008 than pre-2008, whereas education is more important pre-2008. Finally, casual employees receive a wage growth premium during periods of economic up-turn and a penalty during downturn.
Awarded by Australian Research Council Centre of Excellence for Children and Families over the Life Course
The authors thank participants at the 2019 Reserve Bank of Australia Conference on Low Wage Growth for their insightful comments. They also thank Jeff Borland, Gigi Foster, Wolter Hassink, Dean Hyslop, Inga La beta, Viet Nguyen and Mark Wooden for their comments. This paper uses unit record data from Release 18 of the Household, Income and Labour Dynamics in Australia (HILDA) Survey. The HILDA Survey is conducted by the Melbourne Institute of Applied Economic and Social Research on behalf of the Australian Government Department of Social Services (DSS). However, the findings and views reported in this paper are those of the authors and should not be attributed to the Australian Government, DSS or the Melbourne Institute. This research was supported by the Australian Research Council Centre of Excellence for Children and Families over the Life Course (CE140100027). Guyonne Kalb is a Chief Investigator and Jordy Meekes is a Research Fellow at this Centre.