Public- and Private-Sector Occupational Pay Structures

Data from a representative sample of wage and salary workers are used to estimate wage equations that provide for direct estimates of the differences between public and private occupational pay structures. The results show that at the state and local levels of government in particular, the public/private wage differential tends to decline as occupational skill requirements increase. Public employees who work on jobs unique to the public sector are paid a wage premium. There is little support for the idea that degree of union coverage in the private sector affects public wages for an occupation.     

Public–Private Sector Wage Gap in Australia: Variation along the Distribution

Previous research on public–private wage differentials in Australia has focused on the mean of the conditional wage distribution. Using six waves of the Household, Income and Labour Dynamics in Australia survey, this study employs quantile regressions to examine whether the sectoral wage effect varies along the wage distribution. For females, public sector wage premiums are relatively stable for almost the entire distribution. For males, they decrease monotonically and are negative for the top half of the distribution. The decomposition results show that the observed differences in individuals and job characteristics explain a substantial proportion of the sectoral wage gap.     

Entry deregulation,firm organization,and wage inequality

This paper identifies a causal link between changes in product market competition, firm reorganization and within-firm wage inequality. We exploit a unique episode of comprehensive firm entry deregulation as a quasi-natural experiment and use exceptionally detailed linked employer-employee data for the universe of private sector firms and workers in Portugal. Following deregulation affected firms flatten their hierarchies: the number of layers is reduced and managers’ span of control increased. Dropping a hierarchy layer is accompanied by a significant reduction in wage inequality within the firm, by 8% for the average pay ratio between the top and the bottom layer and 4.4% for the 90-50 percentile wage ratio, showing that there are real changes arising from firm reorganization. Overall wage dispersion, measured by the standard deviation of hourly pay, is also reduced. We discuss mechanisms and interpretations for these changes.     

The Gender Pay Gap for Private‐Sector Employees in Canada and Britain

The gender earnings differentials for private‐sector employees in Britain and Canada are similar, substantial and significant. Using linked employer–employee data, we show that women are more likely to be employed in low‐wage workplaces than men in both counties. After accounting for the workplace, women continue to earn less than comparable men. Although men and women face a more equal pay structure within their workplace than they do across workplaces, a substantial portion of the gender pay gap in both countries remains unexplained by the individual characteristics or workplace effects considered in this study.     

Collective Bargaining in the Canadian Public Sector, 1978–2008: The Consequences of Restraint and Structural Change

We study public‐sector bargaining and contract outcomes using Canadian data from 1978 to 2008. We have a number of interesting results, but our principal findings are from our analysis of wage settlements. We find that the essential services designation, which only allows non‐essential members of a bargain unit to strike, is associated with decreases in wages. Our estimates also suggest that there is an arbitration wage premium and that making adjustments to the ability to pay criterion used by arbitrators to determine awards does not affect this premium. We also discuss the implications of our estimates.     

Compensating Wage Differentials versus Efficiency Wages: An Empirical Study of Job Autonomy and Wages

Efficiency wage theory as incorporated in the shirking model predicts that firms may substitute wage premiums for costly monitoring. This means that wage premiums should be expected for loosely monitored workers. By regarding extensive monitoring as a lack of job autonomy, efficiency wage theory predicts a positive relation between autonomy and wages. The theory of compensating wage differentials, however, predicts a negative relation between autonomy and wages. When workers prefer autonomous jobs, employers have to offer higher wages for less autonomous jobs in order to recruit labor.
Swedish micro data are analyzed in order to examine the predictions of these theories. A proxy for the monitoring problem of the firm measures workers' possibilities of effort variation. Since this proxy is autonomy, it enables us to test the two rival hypotheses on the relation between job autonomy and wages. We find a positive relation in the private sector as predicted by the efficiency wage hypotheses and a negative relation in the case of the public sector, which accords with the theory of compensating wage differentials.     

Public‐sector Employment Relations Reform under Labour: Muddling Through on Modernization?

The year 2001 in the UK was dominated by the difficulties the Labour government confronted in developing a coherent programme of public-sector modernization. This review examines recent developments in the public sector, focusing on government attempts to involve the private sector and its continuing reforms of pay determination arrangements. It highlights the tensions that this programme of reform aroused as the government struggled to respond to recruitment and retention problems and widespread perceptions of public-sector 'crisis'.     

What Has Been Happening to Pay in the Public-Service Sector of the British Economy? Developments over the Period 1970–1992

This study presents a detailed analysis of the most important developments in public-service workers' pay over the period since 1970. It records the real earnings growth of all the largest groups of public-service workers in Britain and details the consequences of the different rates of earnings growth enjoyed by the various groups for pay differentials and relative pay in the public sector. It details the size of wage settlements and calculates the magnitude of wage drift for all major groups of public-service-sector workers, and it considers the extent to which the fastest rates of earnings growth appear to result from particular institutional arrangements for determining pay, offering a brief discussion of the role of pay review bodies in this process. The study uses unpublished data from the New Earnings Survey together with detailed information on the size and timing of wage settlements over the period 1970–1992.     

Understanding What Has Been Happening to the Public-Sector Pay Premium in Great Britain: A Distributional Approach Based on the Labour Force Survey

This article investigates what has been happening to the public-sector wage differential in Great Britain over the period 1994–2017. The evidence indicates that apart from men in the lower part of the pay distribution, the public-sector pay premium has declined for all public-sector workers. This decline has coincided with a decline in the overall pay gap, which is associated with changes in the composition of public- and private-sector workforces. As the relative pay disadvantage experienced by public-sector workers at the top of the pay distribution has worsened over time this must raise serious concerns about the ability of the public sector to recruit and retain the staff it needs to deliver public services.     

Whither Solidarity? Transitions in Swedish Public-Sector Pay Policy

As part of a drive for efficiency and decentralization in government operations, Sweden is implementing a new system of pay administration in the public sector that is marked by a clear movement away from centralized wage negotiation and fixed salary increases towards more flexible and individualized pay rates. Despite rhetoric about performance and efficiency, the changes appear to be focused mainly on expanding wage differentials among occupational groups and offering market premiums to recruit and retain valued employees. Although the new pay system has not been integrated into a general management approach, it offers considerable challenge to the norms and values of solidarity that have traditionally been held so strongly in Sweden.     

Pro-poor agricultural biotechnology: Can the international research system deliver the goods?

While global investment in agricultural research by the private sector is increasing with growth in developing country markets and the emergence of new technologies, complementary public sector investment is stagnating or declining in many developing countries. This review argues that the changing roles of the public and private sectors in generating new scientific knowledge may adversely affect the diffusion of explicitly pro-poor technologies—technologies that are simultaneously yield-enhancing and poverty-reducing. Comparing historical evidence from the Green Revolution with recent evidence from the emerging era of agricultural biotechnology, this review argues that a more pluralistic international system for agricultural research will be more responsive to poverty only if the strategic leadership role of the public sector is strengthened, certain research functions are reallocated to the private sector, and new policy and organizational mechanisms are used to stimulate pro-poor research in and for developing-country agriculture.     

High-Involvement Management and Pay in Britain

High‐involvement management practices have well‐established benefits for employers, but what do they do for employees? Using a nationally‐representative survey of British private‐sector workplaces, high‐involvement management is shown to be associated with higher pay. The wage premium is little affected by the choice of employee involvement practices (e.g., teams versus quality circles), but it appears only where employee involvement practices are supported by job security guarantees. Powerful trade unions increase the premium.     

Immigration, Ethnic Wage Differentials and Output Pay in Canada

Recent work suggests that ethnic minority wage differentials in Canada are smaller among those receiving performance pay and that the returns to performance pay are larger for ethnic minorities. This article adds to these findings. First, it demonstrates critical gender differences. The earlier findings are generated almost exclusively by males, as we show that the minority wage differential is small or zero for women in both the time rate sector and the performance pay sector. Second, accounting for immigration and language tends to move the ethnic wage differential in favour of minorities. Minority women on output pay are shown to earn more than non-minority women. While the differential often remains negative for minority men on time rates, it becomes insignificant in our most narrow comparison.     

Evaluating Pay Equity in Michigan: A Strategic Choice Perspective

The strategic choice model provides one framework for analyzing pay equity reform in the public sector. Michigan was experiencing many of the same political and economic forces as other state civil services implementing comparable worth. However, the institutional structure of civil service industrial relations, coupled with the values of officials, undermined the reform process. Rather than adjusting relative wage rates to reflect the new Equitable Classification Plan, civil service officials reaffirmed market criteria in wage setting.     

Underwork,Work‐Hour Insecurity,and A New Approach to Wage and Hour Regulation

When it was passed in 1938, the Fair Labor Standards Act (FLSA) sought to address the “evils” of underpay and overwork by establishing an hourly minimum wage and requiring premium overtime pay. However, today's low‐wage, hourly workers more often face underwork than overwork, as well as fluctuating, unstable schedules, neither of which is addressed by the FLSA. This paper presents and assesses the effectiveness of an alternative approach to wage and hour regulation, the “reporting pay” guarantee. We begin by examining the problem of work‐hour insecurity, particularly employers’ practice of sending workers home early from scheduled shifts. We then move to a detailed assessment of state laws that require reporting pay, as well as reporting pay guarantees in union contracts and private‐employer practices that attempt to address the problem of work‐hour insecurity. We conclude by considering paths for strengthening such protections in law.     

Minimum Wages and Collective Bargaining: What Types of Pay Bargaining Can Foster Positive Pay Equity Outcomes?

Using data from interviews and collective agreements in five European countries, this article analyses the relationship between collective bargaining and the minimum wage. In a context of changing minimum wage policy and competing government objectives, the findings illuminate how pay bargaining strategies of trade unions and employers shape the pay equity effects of minimum wage policy. Two general forms are identified: direct responses to a changing national minimum wage, and responses to the absence or weakness of a national minimum wage. The article explains how particular intersections of minimum wage policy and collective bargaining, together with country and sector contingencies, shape the form of pay bargaining and pay equity outcomes.     

Public Wage Differentials and the Public Administration "Industry"

The public sector consists of two broad sub samples, administrators and no administrators. The two groups have very different occupational compositions and contrasting patterns of compensation. Inconsistent treatment of these sub samples has led to past government differentials, which are not comparable. While administrators remain overpaid relative to their private sector counterparts, no administrators are underpaid relative to their counterparts. Moreover, public wage differentials way substantially in sign and magnitude from industry to industry. Such results demonstrate that no simple, homogeneous government differential exists.     

Firm‐Level Collective Bargaining and Wages in Greece: A Quantile Decomposition Analysis

This article analyzes the effect of firm‐level contracting on the wage structure in the Greek private sector. Using a matched employer–employee dataset for 2006, unconditional quantile regressions and relevant decomposition methods, we identify a wage premium associated with firm‐level contracting, which follows a hump‐shaped profile across the wage distribution. Further, the wage differential between workers under firm‐level and broader‐level collective agreements can be primarily attributed to the differences in the regime‐specific wage setting structure, for those below the median of the unconditional wage distribution, and to differences in worker and firm‐specific characteristics for those in the upper tail.     

Minimum Wages and Youth Employment: Evidence from the Finnish Retail Trade Sector

Following an agreement between the trade unions and the employer organizations in 1993, Finnish employers could temporarily pay less than the existing minimum wage for young workers. We examine the effects of these minimum wage exceptions by comparing the changes in wages and employment of the groups whose minimum wages were reduced with simultaneous changes among slightly older workers for whom the minimum wages remained unchanged. Our analysis is based on payroll record data and minimum wage agreements from the retail trade sector. The results show that average wages in the eligible group declined only modestly. We find no significant effects on employment.     

State Prevailing Wage Laws and School Construction Costs

Critics of prevailing wage laws claim that their elimination will cut total public construction costs by 15 to 25 percent. Justification for this assertion may be found in a 1983 study comparing the cost of public construction regulated by the Davis-Bacon Act with the cost of similar private construction. However, this study failed to account for the difference in the cost of public and private buildings absent . Using F. W. Dodge data for 1991 to 1999, we show that the inclusion of the appropriate controls in a study of new school construction costs finds no statistically significant difference between the cost of public schools built with prevailing wage regulations.