Yuqian Lu

The Growth of Family Earnings Inequality in Canada, 1980-2005

In this study we document recent trends in family earnings inequality using data from the Canadian Census and provide insight into the various factors that drive changes in the family earnings distribution. Over the period 1980-95 we observe substantial increases in family earnings inequality. In contrast, we find that some decrease in inequality occurred over the period 1995-2005 although the earnings of the richest 1 percent of families increased substantially. We use semi-parametric decomposition methods to show that increases in the employment rates of men and women, increases in their educational attainment, and decreases in assortative mating tended to have equalizing effects on the family earnings distribution. We also show that increases in the returns to higher education and increases in the proportion of single individuals as well as lone-parent families drove increases in family earnings inequality.

Wages, Youth Employment, and School Enrollment: Recent Evidence from Increases in World Oil Prices

We exploit variation in wage growth induced by increases in world oil prices to estimate the elasticity of young men’s labor market participation and school enrollment with respect to after-tax wages. Our main finding is that in the aggregate, increased wages have a dual impact: They tend to reduce—at least temporarily—young men’s full-time university enrollment rates but bring (back) into the labor market some young men who were neither enrolled in school nor employed. Contrary to previous research, we find little evidence that young men with no high school diploma now leave school in response to increased wages.

Marriage, cohabitation and women's response to changes in the male wage structure

Using microdata and grouped data that cover the period 1996 to 2006, we assess the extent to which cohabiting women adjust their labour supply to a lesser extent, if any, than married women in response to changes in male wages. Both microdata regressions and grouping estimators unambiguously indicate that cohabiting women respond less to variation in male wages than married women. However, the magnitude of the difference is not sizeable. We also assess the magnitude of married mens and cohabiting mens own wage elasticities and find that they do not differ much. Combined with the fact that male earnings account for roughly two-thirds of family earnings, these two findings explain why the impact of changes in male wages on family earnings is very similar for married couples and cohabiting couples: in both cases, a 10% decline in male wages appears to induce roughly a 6% drop in family earnings.

Wage Growth Over the Past 30 Years: Changing Wages by Age and Education

This article in the Economic Insights series examines two questions: (1) Which groups of Canadian workers have experienced stronger real wage growth over the past three decades?; and (2) To what extent do individuals’ acquisition of education, general work experience, and seniority within firms, as well as their movements into higher-wage or lower-wage occupations and industries, account for differences in real wage growth observed across groups of workers? This article uses data from various Statistics Canada surveys and focuses on the real (hourly or weekly) wages earned by full-time workers. It is based on research carried out at Statistics Canada aimed at providing information on how wage rates of Canadian workers have changed over the past three decades. Wages are expressed in 2010 dollars. Since the early 1980s, real wages of various groups of workers have grown at markedly different rates in Canada and in many industrialized Western countries. Technological changes, growth in international trade, institutional factors (e.g., de-unionization, changes in minimum wages, and changes in the incidence of pay-for-performance), movements in group-specific labour supplies, and changes in social norms have been cited as potential drivers of this differential wage growth. To help shed some light on this matter, the article examines how real wages of Canadian workers evolved across age groups and education levels from 1981 to 2011.