Black/White Wage Convergence: The Role of Public Sector Wages and Employment
INDUSTRIAL AND LABOR RELATIONS REVIEW, April 1996
Posted: 19 Jun 1998
Abstract
This paper assesses the relative contribution of the public and private sectors, through their employment and wages, to the black/white wage convergence that occurred in the U.S. economy over the 1963-92 period. Applying standard decomposition methods to Current Population Survey data, the authors show that almost all the convergence in black/white relative wages in the 1963-75 period was due to black/white convergence in the private sector. Similarly, the post-1975 slowdown in black/white wage convergence was almost completely due to a corresponding slowdown in the private sector. The unimportance of the public sector, the authors argue, arises for two reasons: the public sector never accounted for more than 20% of civilian employment over this period; and blacks' historical success in the public sector left relatively little room for black improvement, whereas in the private sector blacks had considerable ground to make up.
JEL Classification: J45, J15
Suggested Citation: Suggested Citation