Dynamics and wage differentiation in the USA: index approach

V. N. Minat
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V. N. Minat: Ryazan State Agrotechnological University named after P. A. Kostychev, Ryazan, Russian Federation

Russian Journal of Social Sciences and Humanities, 2022, vol. 16, issue 3, 210-219

Abstract: The relevance of wagetrends monitoring is determined by the important and even decisive importance of wages in the personal incomeformation, in consumption stimulation, and ultimately, in the sustainability of the expanded reproduction process. In the leading innovative economy of the world i.e. in the United States, changes and differentials of wages during the period of active structural changes and modernization transformations of the inter-crisis decade, act as a factor in assessing the country’s readiness to maintain world leadership. The purpose of this study is to identify and substantiate structural changes affecting the dynamics and differentials of wages in the United States in 2011-2020. A comprehensive study is carried out on the basis of multilevel index modeling of the average wage in two main directions – by economic activity type and by subregions (statistical and economic regions) of the United States. The analysis is carried out by socio-professional groups and educational level of employed Americans, including adjustment for the inflationary factor of the structural dynamism of wages for the period under study. The results of the study reflect the contradictory development of the modern United States, objectively expressed in structural changes in the modernized economic complex based on convergent technologies and digital services, which invariably destabilize the socio-professional and educational elements of the economic system in terms of capitalizing human and intellectual potential in accordance with “new” demands. On the one hand, the expected trend in the priority of wage growth rates in actively developing knowledge¬intensive types of economic activity due to the higher added value of their products or services is revealed. On the other hand, there is an increase in wage differentials across the US subregions;it increases inequality in the unstable system of American public relations. The main conclusion is to assess the positive dynamics of growth in average wages from the standpoint of structural modernization of the American economy in the inter-crisis period, in which the priority is given to the types of economic activities and sub-regional “centers” of the country focused on innovative development and the preservation of this trend in the context of a new “covid” crisis … However, it undoubtedly contributes to the strengthening of wage differentials in the United States as an important factor in assessing the unevenness and heterogeneity of the national economic system.

Keywords: US wages; average wages; real wages; structural changes in the economy; types of US economic activities; US subregions; wage changes; wage differentiation; index approach / method; complex multilevel modeling (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:aws:omskjl:v:16:y:2022:i:3:p:210-219

DOI: 10.17238/issn1998-5320.2022.16.3.21

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