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Are Good Jobs Disappearing in Canada?

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  • Johnson, Anick
  • Morissette, Rene
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    Abstract

    Using hourly wage data from the Labour Force Survey as well as previous household surveys covering the 1981-2004 period, we assess whether the relative importance of low-paid jobs and well-paid jobs has changed over the last two decades. Since it is unclear whether trends in wage levels obtained from all the aforementioned surveys are unbiased, we refrain from making definitive statements regarding the evolution of low-paid and well-paid jobs over the 1981-2004 period. When assessing whether well-paid jobs are disappearing in Canada, we focus our attention on recent trends, i.e. on changes in the fraction of jobs falling in certain (real) wage categories during the 1997-2004 period. We find little evidence that the relative importance of well-paid jobs - however defined - has fallen over the last two decades or since the second half of the 1990s. We also find little evidence that the relative importance of low-paid jobs, those paying less than $10.00 per hour, has risen during these two periods. We show, along with numerous previous studies, that the wage gap between young workers and their older counterparts has risen substantially over the last two decades but that the wage gap between university graduates and other workers has shown little change. More important, we show that, within age groups, wages of newly hired male and female employees - those with two years of seniority or less - have fallen substantially relative to those of others. Second, in the private sector, the fraction of new employees employed in temporary jobs has risen substantially, increasing from 11% in 1989 to 21% in 2004. Among employees with one year of seniority or less, the incidence of temporary work rose from 14% in 1989 to 25% in 2004. Third, pension coverage has fallen among men of all ages and among females under 45. Taken together, these findings suggest that Canadian firms (existing or newly-born) have responded to growing competition within industries and from abroad by reducing their wage offers for new employees, by offering temporary jobs to a growing proportion of them and by offering less often pension plans that guarantee defined benefits at the time of retirement.

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    Bibliographic Info

    Paper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 2005239e.

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    Date of creation: 26 Jan 2005
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    Handle: RePEc:stc:stcp3e:2005239e

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    Web page: http://www.statcan.gc.ca
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    Related research

    Keywords: Employment and unemployment; Income; pensions; spending and wealth; Labour; Non-wage benefits; Pension plans and funds and other retirement income programs; Wages; salaries and other earnings;

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    References

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    1. J.B. Burbidge & L. Magee & A.L. Robb, 2001. "The Education Premium in Canada and the United States," Quantitative Studies in Economics and Population Research Reports 364, McMaster University.
    2. Paul Beaudry & David Green, 1997. "Cohort Patterns in Canadian Earnings: Assessing the Role of Skill Premia in Inequality Trends," NBER Working Papers 6132, National Bureau of Economic Research, Inc.
    3. Doiron, Denise J & Barrett, Garry F, 1996. "Inequality in Male and Female Earnings: The Role of Hours and Wages," The Review of Economics and Statistics, MIT Press, vol. 78(3), pages 410-20, August.
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    Cited by:
    1. Johnson, Anick & Morissette, Rene, 2007. "Offshoring and Employment in Canada: Some Basic Facts," Analytical Studies Branch Research Paper Series 2007300e, Statistics Canada, Analytical Studies Branch.
    2. Heather Scott-Marshall, 2010. "The Social Patterning of Work-Related Insecurity and its Health Consequences," Social Indicators Research, Springer, vol. 96(2), pages 313-337, April.
    3. Morissette, Rene & Ostrovsky, Yuri, 2005. "Summary Of: The Instability of Family Earnings and Family Income in Canada, 1986 to 1991 and 1996 to 2001," Analytical Studies Branch Research Paper Series 2005266e, Statistics Canada, Analytical Studies Branch.
    4. Picot, Garnett & Morissette, Rene, 2005. "Low-paid Work and Economically Vulnerable Families over the Last Two Decades," Analytical Studies Branch Research Paper Series 2005248e, Statistics Canada, Analytical Studies Branch.
    5. Morissette, Rene & Ostrovsky, Yuri, 2005. "The Instability of Family Earnings and Family Income in Canada, 1986 to 1991 and 1996 to 2001," Analytical Studies Branch Research Paper Series 2005265e, Statistics Canada, Analytical Studies Branch.
    6. Andrew Jackson, 2005. "Productivity and Building Human Capital for the "Bottom Third"," International Productivity Monitor, Centre for the Study of Living Standards, vol. 11, pages 7-13, Fall.
    7. Picot, Garnett & Morissette, Rene, 2005. "Summary Of: Low-paid Work and Economically Vulnerable Families over the Last Two Decades," Analytical Studies Branch Research Paper Series 2005249e, Statistics Canada, Analytical Studies Branch.

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