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Wage diversity in the euro area - an overview of labour cost differentials across industries

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Author Info
Véronique Genre () (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.)
Daphne Momferatou () (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.)
Gilles Mourre

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Abstract

This Paper provides an overview of the magnitude of sectoral wage differentials in the euro area as a whole. Even when adjusting for structural sectoral features such as the skill structure or the proportion of part-timers, average wage levels in services are substantially lower than in manufacturing. The paper also studies how the euro area wage structure compares with that of the United States and the United Kingdom. It discusses some possible determinants of intersectoral wage differentials in the euro area and their likely implications from a policy perspective. A number of worker characteristics (e.g. age, skills, the proportion of temporary or self-employed) are highly correlated with the structure of wage differentials. At the same time, wage differentials are also highly correlated with sector-specific features such as average firm size or capital intensity. Finally, the paper presents some stylised facts on how the euro area wage structure has evolved since the early 1980s.

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Publisher Info
Paper provided by European Central Bank in its series Occasional Paper Series with number 24.

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Length: 47 pages
Date of creation: Feb 2005
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Handle: RePEc:ecb:ecbops:20050024

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Related research
Keywords: Intersectoral wage differential; wage determination; euro area.;

Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Jesper Berg & Annalisa Ferrando & Gabe de Bondt & Silvia Scopel, 2005. "The bank lending survey for the euro area," Occasional Paper Series 23, European Central Bank. [Downloadable!]
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Robert Plasman & Tojerow & François Rycx, 2006. "Industry Wage Differentials, Unobserved Ability, and Rent-Sharing: Evidence from Matched Worker-Firm Data, 1995-2002," Working Papers DULBEA 06-14.RS, Université libre de Bruxelles, Department of Applied Economics (DULBEA). [Downloadable!]
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  2. Martins-da-Rocha, V. F. & Vailakis, Yiannis, 2008. "Endogenous Transaction Costs," Economics Working Papers (Ensaios Economicos da EPGE) 680, Graduate School of Economics, Getulio Vargas Foundation (Brazil). [Downloadable!]
  3. Genre, Véronique & Kohn, Karsten & Momferatou, Daphne, 2009. "Understanding Inter-Industry Wage Structures in the Euro Area," IZA Discussion Papers 4114, Institute for the Study of Labor (IZA). [Downloadable!]
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This page was last updated on 2009-11-20.


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