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Industries, Mega Firms, and Increasing Inequality

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  • John C. Haltiwanger
  • Henry R. Hyatt
  • James Spletzer

Abstract

Most of the rise in overall earnings inequality is accounted for by rising between-industry dispersion from ten percent of 4-digit NAICS industries. These thirty industries are clustered especially in high-paying high-tech and low-paying retail sectors. The rise of employment in mega firms is concentrated in the industries that dominate rising earnings inequality. Earnings differentials for the mega firms relative to small firms decline in the low-paying industries but increase in the high-paying industries. A critical component accounting for the rising dispersion in the top thirty industries is an increasing covariance between industry premia and worker characteristics associated with high earnings.

Suggested Citation

  • John C. Haltiwanger & Henry R. Hyatt & James Spletzer, 2022. "Industries, Mega Firms, and Increasing Inequality," NBER Working Papers 29920, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:29920
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    Cited by:

    1. Sebastian Doerr & Thomas Drechsel & Donggyu Lee, 2022. "Income Inequality and Job Creation," Staff Reports 1021, Federal Reserve Bank of New York.
    2. Jose Garcia-Louzao & Alessandro Ruggieri, 2023. "Labor Market Competition and Inequality," CESifo Working Paper Series 10829, CESifo.
    3. David Card & Jesse Rothstein & Moises Yi, 2023. "Industry Wage Differentials: A Firm-Based Approach," NBER Working Papers 31588, National Bureau of Economic Research, Inc.
    4. Hervé, Justine, 2023. "Specialists or generalists? Cross-industry mobility and wages," Labour Economics, Elsevier, vol. 84(C).

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    More about this item

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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