Literature

Synthesizing the Literature

Christopher Walters

BTM7300: Scholarly Literature Review

Dr. Eva Philpot

December 6, 2015

Analyzing the increase in pay inequality over the last several years.

After reading J.C. Cunningham’s measuring wage inequality within and across US metropolitan areas, he presented how wages in the US have steadily declined for the unskilled worker and steadily increased for the skilled worker and or top 1 percent in US metropolitan area. The author also presented data showing how wage inequality is either negatively or positively affected within private and public sectors based on employee performance. The author made an interesting statement concerning US economic policies, and how they have impacted wage and pay inequality within the US from the 1970’s until today.

The author used one method or measure to acquire the data needed—the ratio of the 90th wage percentile to the 10th wage percentile, sometimes called the “90–10” ratio, inequality increased by 7 percent in the United States between 2003 and 2013. The study included data from the Occupational Employment Statistics program. Workers within 4 key areas of the wage distribution graph were sampled.

After reading D. J. Hammann, and T. Ren’s wage inequality and performance in nonprofit and for-profit organizations, the authors presented data to show how pay inequality is more prevalent in the for profit area than in the nonprofit area. The authors argue that tournament and fair wage/equity theories play a role in how each area impacts pay inequality. The authors used data from a study of workers in the nursing home industry. The data suggested that workers in nonprofit positions were more likely to be paid fairly or based on their skill level, as opposed to for profit positions and how similar positions are paid.

Finally, after reviewing wage inequality: A story of policy choices by L. Mishel, J. Schmitt, & H. Shierolz, the authors presented data to show how economic policies in the US has had a direct impact on wage and pay inequality on workers in the US. The authors focused on workers at four key points in the wage distribution: workers at the bottom (the 10th percentile, who earn more than 10 percent of workers, but less than 90 percent), the middle (the 50th percentile, or median, worker right in the middle of the wage distribution), the top (the 90th percentile, who earn more than 90 percent of workers, but less than the top 10 percent), and the very top (roughly, the top 1 percent). Based on wage and pay data, the authors discovered that wages for the top 1 percent increased by 156% between 1979 and 2007, and only 17% for the bottom 90 percent of wage earners during the same period.

Each study showed data that presented a steady decrease in non-skilled worker wages and an increase in skilled or executive wages. A difference would be the area of concentration on the study of the workers in the 90-10 study, and the study using data from the nursing home industry.

Each study was able to submit data that showed an increase in executive and highly skilled worker wages and a steady decrease in the moderately skilled to low skilled worker wages.

Each study is relevant to my theory that wage inequality in the US for workers as well as between men and women has shown a steady increase over the last several decades and continues to increase as highly skilled workers wages increase and moderate to low skilled workers wages decrease.

References

Cunningham, J. C. (2015). Measuring wage inequality within and across U.S. metropolitan areas, 2003–13. Monthly Labor Review, 1-18.

Hamann, D. J., & Ren, T. (2013). Wage Inequality and Performance in Nonprofit and For-Profit Organizations. Nonprofit Management & Leadership, 24(2), 207-228. doi:10.1002/nml.21085

Mishel, L., Schmitt, J., & Shierholz, H. (2014). Wage Inequality: A Story of Policy Choices. New Labor Forum (Sage Publications Inc.), 23(3), 26-31. doi:10.1177/1095796014544325

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