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Symposium 2014

The Future of Wages and Benefits

The Challenge

How wages and related costs will develop in the future is an important question for business, politics and society alike. The evolution of inequalities, in which labour income is probably the most tangible component, is inextricably linked to the development of wages and benefits. It is clear that exogenous forces, such as demography, technological developments, or globalization will all have a marked impact on wages and benefits. For example, technology might kill existing employment relationships and drive down the returns to labour in the short run, which is already mirrored in the declining labour share of income. Moreover, demographic change will drive up wage-related costs, as insurance-based pension systems will have to deal with an increasing population share of the elderly.

What could be the drivers of change in the future? How do developments differ between industries? What can we learn from a disaggregated perspective on the developments? What policies do societies need to cope with these changes?

    Proposals

    Proposal
    Symposium 2014

    The Future of Wages and Benefits

    The key to competitive and reasonable wages is strengthening education and training. The future of wages and benefits will depend to a large extend on the capabilities of the work force. Investment in ...

    The key to competitive and reasonable wages is strengthening education and training. The future of wages and benefits will depend to a large extend on the capabilities of the work force. Investment in education and training and thus enabling people are the best way of attracting investments by companies and creating jobs and income.

    Polity, Academia, Business, Civil Society
    Proposal
    Symposium 2014

    The Future of Wages and Benefits

    The key to competitive and reasonable wages and benefits is strengthening the formal labour market as opposed to the informal labour market which still comprises 80 per cent and more of the workers in ...

    The key to competitive and reasonable wages and benefits is strengthening the formal labour market as opposed to the informal labour market which still comprises 80 per cent and more of the workers in most developing markets. In order to strengthen the formal labour market the relevant laws, rules and regulations should enable hiring and also dismissing employees with relative ease. While such an approach may reduce the wages and benefits for the small share of privileged workers in the current formal labour market, medium and long term it will give better conditions to the average worker.

    Polity, Academia, Business, Civil Society

    Background Paper

    Background Paper
    Symposium 2014

    2014 Industry Performance - The Future of Wages and Benefits

    Polity, Academia, Business, Civil Society

    Virtual Library

    Virtual Library File
    Symposium 2014

    The Global Decline of the Labor Share

    The stability of the labor share of income is a key foundation in macroeconomic models. We document, however, that the global labor share has signicantly declined since the early 1980s, with the dec ...

    The stability of the labor share of income is a key foundation in macroeconomic models. We document, however, that the global labor share has signicantly declined since the early 1980s, with the decline occurring within the large majority of countries and industries. We show that the decrease in the relative price of investment goods, often attributed to advances in information technology and the computer age, induced rms to shift away from labor and toward capital. The lower price of investment goods explains roughly half of the observed decline in the labor share, even when we allow for other mechanisms in uencing factor shares such as increasing prots, capital-augmenting technology growth, and the changing skill composition of the labor force. We highlight the implications of this explanation for welfare and macroeconomic dynamics.

    Virtual Library File
    Symposium 2014

    The Future of Work

    Trends and challenges for low-wage workers

    Trends and challenges for low-wage workers

    Virtual Library File
    Symposium 2014

    Do Large Modern Retailers Pay Premium Wages?

    With malls, franchise strips and big-box retailers increasingly dotting the landscape, there is concern that middle-class jobs in manufacturing in the U.S. are being replaced by minimum wage jobs in ...

    With malls, franchise strips and big-box retailers increasingly dotting the landscape, there is concern that middle-class jobs in manufacturing in the U.S. are being replaced by minimum wage jobs in retail. Retail jobs have spread, while manufacturing jobs have shrunk in number. In this paper, we characterize the wages that have accompanied the growth in retail. We show that wage rates in the retail sector rise markedly with firm size and with establishment size. These increases are halved when we control for worker fixed effects, suggesting that there is sorting of better workers into larger firms. Also, higher ability workers get promoted to the position of manager, which is associated with higher pay. We conclude that the growth in modern retail, characterized by larger chains of larger establishments with more levels of hierarchy, is raising wage rates relative to traditional mom-and-pop retail stores.

    Virtual Library File
    Symposium 2014

    Regional disparity of labor's share in China: Evidence and explanation

    Despite the “growth miracle” of recent decades, labor’s share, i.e., the share of total labor compensation in GDP, has decreased in China. Labor’s share is an important indicator of the prim ...

    Despite the “growth miracle” of recent decades, labor’s share, i.e., the share of total labor compensation in GDP, has decreased in China. Labor’s share is an important indicator of the primary distribution of national income, and its fall has drawn significant attention from researchers and policymakers. As China’s many regions have different development levels and economic structures, it is very likely that labor’s share will differ across regions. Thus, it is important to examine the regional disparity of labor’s share. Using Chinese provincial data from 1997 to 2007, we find a significant difference in labor’s share between eastern and western China. Then, we use spatial cross-sectional and panel models to show the significant effect of industrial composition and ownership structure on regional labor shares.

    Virtual Library File
    Symposium 2014

    Workers Still Uneasy About Financial Security and Retirement

    In the more than five years since the financial crisis, equity markets have climbed to historic highs and the housing market has rebounded. Nevertheless, persistent unemployment and stagnant wages h ...

    In the more than five years since the financial crisis, equity markets have climbed to historic highs and the housing market has rebounded. Nevertheless, persistent unemployment and stagnant wages have sapped economic momentum and undermined workers’ financial security and retirement confidence.