Are Manufacturing Jobs Still Good Jobs? An Exploration of the Manufacturing Wage Premium

Kimberly Bayard, Tomaz Cajner, Vivi Gregorich and Maria D. Tito
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Kimberly Bayard: https://www.federalreserve.gov/econres/kimberly-n-bayard.htm
Maria D. Tito: https://www.federalreserve.gov/econres/maria-d-tito.htm

No 2022-011r1, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: This paper explores the factors behind the disappearance of the manufacturing wage premium—the additional pay a manufacturing worker earns relative to a comparable nonmanufacturing worker. With substantially larger declines across union members, we quantify the role of unionization by exploiting the heterogeneity in membership status across manufacturing industries. We find that the decline in union membership explains more than 70 percent of the decline in the wage premium since the 1990s for union members but does not affect nonunion premia. Our findings suggest that the erosion of “good” manufacturing jobs has contributed to the increase in overall wage inequality.

Keywords: Wage inequality; Wage premia; Manufacturing; Production workers; Union membership (search for similar items in EconPapers)
JEL-codes: E24 J31 J51 (search for similar items in EconPapers)
Pages: 53 p.
Date: 2022-03-18, Revised 2024-09-24
New Economics Papers: this item is included in nep-lma and nep-mac
Note: Revision
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2022-11

DOI: 10.17016/FEDS.2022.011r1

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