Impact of policy decisions on median wage growth, 1979--2017

Factor Impact on median wage
Growth (deflated by CPI-U-RS), 1979–2017
1 Net productivity 56.0%
2 Median hourly compensation 13.0%
3 Production worker hourly compensation 10.9%
4 Productivity–median hourly compensation divergence (12) 43.0%
1 Excessive unemployment* 10.0%
2 Erosion of collective bargaining 7.9%
3 Globalization 5.6%
4 Weaker labor standards
Erosion of minimum wage 0.0%
Overtime coverage for salaried workers 0.3%
Wage theft n.a.
Misclassification 1.0%
Increased presence of undocumented n.a.
Guestworker programs n.a.
Increased racial discrimination n.a.
5 Employer-imposed contract terms
Noncompetes 2.25%
Anti-poaching n.a.
Forced arbitration n.a.
6 Corporate structure
Labor concentration 0.0%
Dominant buyer 3.4%
Fissuring 2.25%
Product market monopoly 0.0%
Industry deregulation n.a.
7 Automation/skill-biased technological change
1979–1995 n.a.
1995–2017 0.0%

* Average relative to 5.5% unemployment.

Sources: Excessive unemployment estimate based on Bivens and Zipperer 2018 and Katz and Krueger 1999; erosion of collective bargaining estimate based on Fortin, Lemieux, and Lloyd 2021, Stansbury and Summers 2020, Western and Rosenfeld 2011; globalization estimate based on Bivens 2013 and Autor, Dorn, and Hanson 2013; erosion of minimum wage estimate based on Fortin, Lemieux, and Lloyd 2021 and Autor, Manning, and Smith 2016; overtime coverage for salaried workers estimates based on analysis of Department of Labor 2016; noncompetes estimates based on Lipsitz and Starr 2020; dominant buyer estimates based on Wilmers 2018; fissuring based on Weil 2019; automation/skill-biased technological change from 1995–2017 estimates based on Autor, Goldin, and Katz 2020 and Autor 2017.

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