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The Role of Establishments and the Concentration of Occupations in Wage Inequality☆

In: Inequality: Causes and Consequences


  • Elizabeth Weber Handwerker
  • James R. Spletzer


This paper uses the microdata of the Occupational Employment Statistics (OES) Survey to assess the contribution of occupational concentration to wage inequality between establishments and its growth over time. We show that occupational concentration plays an important role in wage determination for workers, in a wide variety of occupations, and can explain some establishment-level wage variation. Occupational concentration is increasing during the 2000–2011 time period, although much of this change is explained by other observable establishment characteristics. Overall, occupational concentration can help explain a small amount of wage inequality growth between establishments during this time period.

Suggested Citation

  • Elizabeth Weber Handwerker & James R. Spletzer, 2016. "The Role of Establishments and the Concentration of Occupations in Wage Inequality☆," Research in Labor Economics, in: Inequality: Causes and Consequences, volume 43, pages 167-193, Emerald Group Publishing Limited.
  • Handle: RePEc:eme:rleczz:s0147-912120160000043013
    DOI: 10.1108/S0147-912120160000043013

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    Cited by:

    1. Daniel Baumgarten & Gabriel Felbermayr & Sybille Lehwald, 2020. "Dissecting Between‐Plant and Within‐Plant Wage Dispersion: Evidence from Germany," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 59(1), pages 85-122, January.
    2. Schaefer, Daniel & Singleton, Carl, 2017. "Recent changes in British wage inequality: Evidence from firms and occupations," MPRA Paper 76744, University Library of Munich, Germany.
    3. Magda, Iga & Gromadzki, Jan & Moriconi, Simone, 2021. "Firms and wage inequality in Central and Eastern Europe," Journal of Comparative Economics, Elsevier, vol. 49(2), pages 499-552.
    4. John Haltiwanger & James R. Spletzer, 2021. "Rising Between-Firm Inequality and Declining Labor Market Fluidity: Evidence of a Changing Job Ladder," NBER Chapters, in: Measuring Distribution and Mobility of Income and Wealth, pages 45-67, National Bureau of Economic Research, Inc.
    5. Hervé, Justine, 2023. "Specialists or generalists? Cross-industry mobility and wages," Labour Economics, Elsevier, vol. 84(C).
    6. Magda, Iga & Salach, Katarzyna, 2019. "Gender Pay Gap Patterns in Domestic and Foreign-Owned Firms," IZA Discussion Papers 12453, Institute of Labor Economics (IZA).
    7. Cortes, Guido Matias & Salvatori, Andrea, 2019. "Delving into the demand side: Changes in workplace specialization and job polarization," Labour Economics, Elsevier, vol. 57(C), pages 164-176.
    8. Roberto Pinheiro & Murat Tasci, 2019. "Firms, Skills, and Wage Inequality," Working Papers 17-06R, Federal Reserve Bank of Cleveland.
    9. Daniel Schaefer & Carl Singleton, 2020. "Recent Changes in British Wage Inequality: Evidence from Large Firms and Occupations," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(1), pages 100-125, February.

    More about this item


    Wage inequality; establishments; occupational concentration; employers; employer–employee microdata; J31; D31; L11; D22; M12; M50;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General


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