February 2000, Vol. 123, No. 2
Interindustry wage differentials: patterns and possible sources
Jane OsburnDo workers with similar skills in similar occupations receive similar wages across industries? Differences in interindustry wages have been widely documented over the last two decades, and researchers continue to discuss these differences. In particular, they seek the sources of wage dispersion among individual workers, employers, industries, and geographic areas. Recent attempts to explore the role of particular technologies, including microprocessor technologies, in wage dispersion has heightened interest in this issue.1
This article examines interindustry wage differentials, using data from the Occupational Employment Statistics (OES) survey. The OES classifies employment and wages of individuals by detailed occupation and three-digit Standard Industrial Classification (SIC) industry.2 The OES survey solicits employment and wage data for more than 700 occupations in three-digit sic industries using a sample of 1.2 million establishments.3 Estimates of occupational employment and wages are developed for the Nation, individual States, and metropolitan statistical areas, as well as Guam, Puerto Rico, and the Virgin Islands. This article uses data from the 1996, 1997, and 1998 surveys, which when combined account for the total OES sample. (Hereafter referred to as the 1998 OES data.)4
This excerpt is from an article published in the February 2000 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.
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Footnotes
1 See for example, David H. Autor, Lawrence F. Katz, and Alan B. Krueger, "Computing Inequality: Have Computers Changed the Labor Market?" Quarterly Journal of Economics, vol. 113, no. 4, 1998, pp. 1169–1213. Also see Eli Berman, John Bound, and Zvi Griliches, "Changes in the Demand for Skilled Labor Within U.S. Manufacturing Industries: Evidence From the Annual Survey of Manufacturers," Quarterly Journal of Economics, vol. 109, no. 2, 1994, pp. 367–97; and Mark Doms, Timothy Dunne, and Kenneth R. Troske, "Workers, Wages, and Technology," Quarterly Journal of Economics, vol. 112, no. 1, 1997, pp. 253–90.
2 See Standard Industrial Classification Manual, 1987, Office of Management and Budget.
3 The full Occupational Employment Statistics sample includes, with certainty, all Federal and State government employees and all establishments employing more than 250 workers, together making up approximately one-third of total U.S. employment. The remaining two-thirds of all workers are surveyed with probability equal to the reciprocal of the probability of selection of the establishment in which they are employed. The average number of workers included in the sample for any given three-digit SIC industry/occupation cell is roughly 1,500 individuals.
4 Data for these 3 years were combined by first adjusting the 1996 and 1997 wage rates to reflect wage change over the 1996–98 period, using wage change indices obtained from the Employment Cost Index program.
The Occupational Employment Statistics (OES) survey is a cooperative Federal/State effort that provides occupational employment and wage data for more than 760 occupations in detailed industrial sectors. The Department of Labor provides the funding and technical support for the program, and the States collect the data as well as provide the results in published form. OES was initiated in 1971, with 15 participating States, and has expanded throughout the years to include all 50 States and U.S. territories. As a result of a redesign effort in 1996, the OES survey now also provides occupational wage data by detailed industry. The 1996 redesign effort also expanded the scope of the OES sur-vey to include all industries every year. For more information on the technical aspects of the OES survey, contact the Office of Employment and Unemployment Statistics, room 4840, 2 Massachusetts Avenue, NE, Washington DC 20212; telephone (202) 691-6569; or e-mail at: oesinfo@bls.gov.
Occupational Employment Statistics
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