Rising wage inequality

Rising wage inequality is the widening of the wage distribution in North America since about 1980: the gap between high and low earners grew, the skill premium (the wage of skilled workers relative to unskilled workers) rose, and wages spread out among workers with the same education and experience. Because the relative supply of skilled workers grew at the same time, the supply and demand model implies that relative demand for skilled labour grew even faster. No single cause accounts for the shift; technology, trade and weaker labour market institutions all contributed.

The facts

US wage inequality rose along three dimensions in the 1980s:¹

1. Top versus bottom. The 90-10 wage gap widened. Since 1980 the upper-tail (90-50) gap has grown steadily, while the lower-tail (50-10) gap rose sharply in the early 1980s and then levelled off.
2. Between groups. Wage differentials by education, occupation, age and experience rose. The college premium fell in the 1970s, as large cohorts of new graduates entered the labour market, then rebounded faster in the 1980s.
3. Within groups. Wage dispersion rose among workers of the same education, age and sex (within-group or residual inequality).

Over the longer run, Goldin and Katz find that US educational wage differentials narrowed for most of the twentieth century, then rose so quickly after 1980 that by 2005 the college premium was back at its 1915 level.²

U.S. college wage premium

Median weekly earnings, bachelor's degree or higher ÷ high school only, full-time workers aged 25 and over

Median weekly earnings of US full-time workers with a bachelor's degree or more, relative to high school graduates. The ratio rose from about 1.75 in the early 2000s to about 1.8 from 2008 on: the premium is high but has grown slowly since 2000.Source: FRED, Employed full time: Median usual weekly nominal earnings (second quartile): Wage and salary workers, 25 years and over: Bachelor's degree and higher (LEU0252918500Q); High School graduates, no college (LEU0252917300Q), U.S. BLS Current Population Survey. Retrieved 2026-10-23.

Show the data and notes

Ratio of the two published medians (quarterly, not seasonally adjusted). High school only = high school graduates with no college. Raw ratio: it does not control for age, experience or occupation. Not published: 2025-Q4 (October 2025 Current Population Survey data were not collected during the federal government shutdown).

Period	Bachelor's or higher ÷ high school
2000 Q1	1.761
2000 Q2	1.753
2000 Q3	1.771
2000 Q4	1.767
2001 Q1	1.789
2001 Q2	1.757
2001 Q3	1.778
2001 Q4	1.746
2002 Q1	1.764
2002 Q2	1.765
2002 Q3	1.769
2002 Q4	1.740
2003 Q1	1.750
2003 Q2	1.771
2003 Q3	1.702
2003 Q4	1.739
2004 Q1	1.772
2004 Q2	1.689
2004 Q3	1.714
2004 Q4	1.714
2005 Q1	1.750
2005 Q2	1.705
2005 Q3	1.739
2005 Q4	1.759
2006 Q1	1.721
2006 Q2	1.772
2006 Q3	1.739
2006 Q4	1.752
2007 Q1	1.711
2007 Q2	1.829
2007 Q3	1.784
2007 Q4	1.780
2008 Q1	1.802
2008 Q2	1.782
2008 Q3	1.830
2008 Q4	1.801
2009 Q1	1.835
2009 Q2	1.810
2009 Q3	1.844
2009 Q4	1.757
2010 Q1	1.827
2010 Q2	1.809
2010 Q3	1.862
2010 Q4	1.799
2011 Q1	1.817
2011 Q2	1.774
2011 Q3	1.811
2011 Q4	1.807
2012 Q1	1.773
2012 Q2	1.766
2012 Q3	1.806
2012 Q4	1.805
2013 Q1	1.826
2013 Q2	1.844
2013 Q3	1.781
2013 Q4	1.881
2014 Q1	1.817
2014 Q2	1.782
2014 Q3	1.718
2014 Q4	1.843
2015 Q1	1.834
2015 Q2	1.785
2015 Q3	1.836
2015 Q4	1.804
2016 Q1	1.841
2016 Q2	1.810
2016 Q3	1.809
2016 Q4	1.819
2017 Q1	1.823
2017 Q2	1.797
2017 Q3	1.780
2017 Q4	1.790
2018 Q1	1.804
2018 Q2	1.804
2018 Q3	1.818
2018 Q4	1.796
2019 Q1	1.827
2019 Q2	1.807
2019 Q3	1.846
2019 Q4	1.850
2020 Q1	1.805
2020 Q2	1.797
2020 Q3	1.837
2020 Q4	1.819
2021 Q1	1.801
2021 Q2	1.813
2021 Q3	1.804
2021 Q4	1.765
2022 Q1	1.844
2022 Q2	1.846
2022 Q3	1.797
2022 Q4	1.768
2023 Q1	1.834
2023 Q2	1.786
2023 Q3	1.790
2023 Q4	1.754
2024 Q1	1.865
2024 Q2	1.838
2024 Q3	1.794
2024 Q4	1.745
2025 Q1	1.841
2025 Q2	1.804
2025 Q3	1.783
2026 Q1	1.805
2026 Q2	1.779
2026 Q3	1.764

U.S. median weekly earnings by education

Full-time wage and salary workers aged 25 and over, quarterly

• Bachelor's degree or higher
• High school, no college

The levels behind the ratio, in nominal dollars. Both medians roughly doubled between 2000 and 2026, so the ratio changed little.Source: FRED, Employed full time: Median usual weekly nominal earnings (second quartile): Wage and salary workers, 25 years and over: Bachelor's degree and higher (LEU0252918500Q); High School graduates, no college (LEU0252917300Q), U.S. BLS Current Population Survey. Retrieved 2026-10-23.

Show the data and notes

Nominal dollars, not seasonally adjusted. Not published: 2025-Q4 (October 2025 Current Population Survey data were not collected during the federal government shutdown).

Period	Bachelor's degree or higher	High school, no college
2000 Q1	$886	$503
2000 Q2	$887	$506
2000 Q3	$896	$506
2000 Q4	$894	$506
2001 Q1	$916	$512
2001 Q2	$912	$519
2001 Q3	$928	$522
2001 Q4	$927	$531
2002 Q1	$940	$533
2002 Q2	$939	$532
2002 Q3	$941	$532
2002 Q4	$943	$542
2003 Q1	$961	$549
2003 Q2	$969	$547
2003 Q3	$958	$563
2003 Q4	$967	$556
2004 Q1	$996	$562
2004 Q2	$973	$576
2004 Q3	$984	$574
2004 Q4	$996	$581
2005 Q1	$1,013	$579
2005 Q2	$996	$584
2005 Q3	$1,014	$583
2005 Q4	$1,029	$585
2006 Q1	$1,019	$592
2006 Q2	$1,047	$591
2006 Q3	$1,047	$602
2006 Q4	$1,046	$597
2007 Q1	$1,030	$602
2007 Q2	$1,092	$597
2007 Q3	$1,088	$610
2007 Q4	$1,086	$610
2008 Q1	$1,108	$615
2008 Q2	$1,105	$620
2008 Q3	$1,131	$618
2008 Q4	$1,115	$619
2009 Q1	$1,138	$620
2009 Q2	$1,140	$630
2009 Q3	$1,145	$621
2009 Q4	$1,121	$638
2010 Q1	$1,140	$624
2010 Q2	$1,138	$629
2010 Q3	$1,158	$622
2010 Q4	$1,139	$633
2011 Q1	$1,150	$633
2011 Q2	$1,141	$643
2011 Q3	$1,152	$636
2011 Q4	$1,158	$641
2012 Q1	$1,158	$653
2012 Q2	$1,164	$659
2012 Q3	$1,170	$648
2012 Q4	$1,168	$647
2013 Q1	$1,189	$651
2013 Q2	$1,193	$647
2013 Q3	$1,174	$659
2013 Q4	$1,219	$648
2014 Q1	$1,199	$660
2014 Q2	$1,187	$666
2014 Q3	$1,170	$681
2014 Q4	$1,224	$664
2015 Q1	$1,227	$669
2015 Q2	$1,210	$678
2015 Q3	$1,234	$672
2015 Q4	$1,245	$690
2016 Q1	$1,250	$679
2016 Q2	$1,249	$690
2016 Q3	$1,266	$700
2016 Q4	$1,270	$698
2017 Q1	$1,280	$702
2017 Q2	$1,290	$718
2017 Q3	$1,271	$714
2017 Q4	$1,278	$714
2018 Q1	$1,286	$713
2018 Q2	$1,310	$726
2018 Q3	$1,338	$736
2018 Q4	$1,340	$746
2019 Q1	$1,350	$739
2019 Q2	$1,357	$751
2019 Q3	$1,383	$749
2019 Q4	$1,382	$747
2020 Q1	$1,386	$768
2020 Q2	$1,416	$788
2020 Q3	$1,457	$793
2020 Q4	$1,421	$781
2021 Q1	$1,426	$792
2021 Q2	$1,438	$793
2021 Q3	$1,474	$817
2021 Q4	$1,467	$831
2022 Q1	$1,525	$827
2022 Q2	$1,547	$838
2022 Q3	$1,556	$866
2022 Q4	$1,547	$875
2023 Q1	$1,621	$884
2023 Q2	$1,588	$889
2023 Q3	$1,620	$905
2023 Q4	$1,608	$917
2024 Q1	$1,680	$901
2024 Q2	$1,684	$916
2024 Q3	$1,697	$946
2024 Q4	$1,705	$977
2025 Q1	$1,754	$953
2025 Q2	$1,732	$960
2025 Q3	$1,747	$980
2026 Q1	$1,763	$977
2026 Q2	$1,768	$994
2026 Q3	$1,752	$993

The Canadian skill premium is smaller. Among men aged 25 to 34 in 2009, college graduates earned about 70 percent more than high school graduates in the United States and about 30 percent more in Canada.³ In the 2021 Census, the median employment income of Canadians aged 25 to 54 working full-year, full-time was $81,000 with a bachelor’s degree or higher and $54,000 with a high school diploma.⁴

The model: skilled and unskilled labour

Firms produce output $Q$ from skilled labour $L_S$ and unskilled labour $L_U$ with a constant elasticity of substitution (CES) production function:

$$Q = \left[\alpha L_S^{\delta} + (1 - \alpha) L_U^{\delta}\right]^{1/\delta}, \qquad \delta \le 1,$$

where $\alpha$ is the weight on skilled labour and $\delta$ governs how easily one type substitutes for the other. The CES nests perfect substitutes ($\delta = 1$), Cobb-Douglas ($\delta \to 0$) and perfect complements ($\delta \to -\infty$).

In a competitive market each wage equals the value of the marginal product. With the output price set to 1, differentiating gives

$$w_S = \alpha Q^{1-\delta} L_S^{\delta - 1}, \qquad w_U = (1 - \alpha) Q^{1-\delta} L_U^{\delta - 1}.$$

The ratio cancels $Q^{1-\delta}$:

$$\frac{w_S}{w_U} = \frac{\alpha}{1-\alpha}\left(\frac{L_S}{L_U}\right)^{\delta - 1} \quad\Longrightarrow\quad \log\frac{w_S}{w_U} = b_0 + b_1 \log\frac{L_S}{L_U},$$

with $b_0 = \log\frac{\alpha}{1-\alpha}$ and $b_1 = \delta - 1$. This is the relative demand curve for skilled labour. Because $\delta \lt 1$, $b_1 \lt 0$: the more skilled workers there are relative to unskilled workers, the lower their relative wage. The slope measures substitutability: the elasticity of substitution is $\sigma = 1/(1-\delta) = -1/b_1$. Katz and Murphy’s estimates for the United States imply $b_1 \approx -0.71$, or $\sigma \approx 1.4$.⁵

• Relative demand shifts when $\alpha$ changes, that is, when the productivity of skilled labour rises relative to unskilled labour: new technology, capital that complements skilled workers, or a change in the mix of goods produced.
• Relative supply is the ratio $L_S/L_U$. In the short run it is fixed by the number of graduates and non-graduates in the labour force, so it is a vertical line. More graduates shift it right.

Relative supply after the shift, L_S/L_U

2.00

Weight on skilled labour after the shift, α

0.75

w_S/w_U at A (start)

1.50

at B (supply shift only)

0.92

at A′ (demand shift only)

3.00

at C (both shifts)

1.85

Open in Graph Lab

Figure 1. Relative supply of skilled workers doubles ($S_0$ to $S_1$). With demand unchanged the premium falls from 1.50 at A to 0.92 at B; a demand shift alone ($D_0$ to $D_1$) raises it to 3.00 at A′. With both shifts the premium rises to 1.85 at C, the pattern observed after 1980.

Key idea

In logs, the change in the skill premium is $\Delta b_0 + b_1 \Delta \log(L_S/L_U)$. More skilled workers ($\Delta \log(L_S/L_U) \gt 0$) lower the premium, so a premium that rises while relative supply grows requires relative demand to shift out by more.

Relative demand versus relative supply over time

If relative demand grows at a steady rate $g$ and relative supply at rate $n$, the log premium changes by $g + b_1 n = g - 0.7n$ a year. Katz and Murphy estimate a demand trend of about 3.3 percent a year, so the premium is stable when relative supply grows about $3.3 / 0.7 \approx 4.7$ percent a year, rises when supply grows more slowly and falls when it grows faster.⁵ The 1970s, with rapid growth in the number of graduates, fit the falling-premium case; a sharp deceleration in the relative supply of college workers in the 1980s fits the rising-premium case.¹²

Growth of relative supply (% a year)

2.00%

Growth of relative demand (% a year)

3.3%

Change in log relative wage each year

1.90%

w_S/w_U after 30 years

2.65

Supply growth that keeps w_S/w_U constant

4.7%

Open in Graph Lab

Figure 2. The skill premium over 30 years when relative demand grows 3.3 percent a year. With relative supply growing 2 percent a year, the premium rises from 1.50 to 2.65; it stays constant only if supply grows about 4.7 percent a year.

Worked example

The economy starts at $\alpha = 0.6$, $\delta = 0.3$ and $L_S/L_U = 1$. Relative supply then doubles.

1. Relative demand curve. $b_0 = \log(0.6/0.4) = 0.405$ and $b_1 = 0.3 - 1 = -0.7$, so $\log(w_S/w_U) = 0.405 - 0.7\log(L_S/L_U)$.

2. Starting premium (A). At $L_S/L_U = 1$, $\log 1 = 0$, so $\log(w_S/w_U) = 0.405$ and $w_S/w_U = e^{0.405} = 1.50$.

3. Supply shift alone (B). $\log 2 = 0.693$, so $\log(w_S/w_U) = 0.405 - 0.7(0.693) = -0.080$ and $w_S/w_U = 0.92$: skilled workers now earn less than unskilled workers.

4. Demand shift needed for the observed premium (C). For the premium to reach 1.85 with $L_S/L_U = 2$: $b_0 = \log 1.85 + 0.7(0.693) = 0.615 + 0.485 = 1.100$, so $\alpha/(1-\alpha) = e^{1.100} = 3.0$ and $\alpha = 0.75$.

5. Interpretation. The weight on skilled labour must rise from 0.60 to 0.75 to raise the premium by 23 percent while the relative number of skilled workers doubles.

Exercise: the race over ten years

Relative demand grows 3.3 percent a year and relative supply 2 percent a year. The log premium rises $0.033 - 0.7(0.02) = 0.019$ a year, or $0.19$ over ten years, so a premium of 1.50 becomes $1.50 \times e^{0.19} = 1.81$. If supply grows 6 percent a year instead, the log premium falls $0.042 - 0.033 = 0.009$ a year, and the premium falls to $1.50 \times e^{-0.09} = 1.37$.

Why relative demand outgrew relative supply

Supply shifts and immigration. The growing share of university graduates shifted relative supply right, which by itself lowers the premium; it cannot explain a rising premium. Immigration raises the premium only to the extent that immigrants add more to unskilled than to skilled labour. Canada selects economic immigrants partly on education (its Express Entry ranking gives a single applicant 150 points for a doctorate and 30 for a high school diploma), so immigrants selected this way add mainly to the supply of skilled labour, yet Canadian inequality rose too.⁶ Immigration may matter in some countries, but it cannot be the main cause. See immigration.

International trade. Importing goods made with less-skilled labour lowers demand for unskilled domestic workers relative to skilled workers. Rising Chinese import competition from 1990 to 2007 explains, conservatively, about a quarter of the decline in US manufacturing employment over that period.⁷ In Canada, the estimated job losses from Chinese import competition over 2001 to 2011 were 150,000 to 170,000, including at least 105,000 in manufacturing, 21 percent of the decline in manufacturing employment.⁸

Skill-biased technological change. Computers raise the productivity of workers who analyse, design and manage, and replace workers who perform routine tasks, raising $\alpha$. Models combining steady growth in demand for skills with slower growth in college supply track the US college premium over four decades; their refinement stresses that information technology complements abstract, high-education tasks and substitutes for routine, middle-education tasks.¹ The timing is the weakness: inequality rose sharply in the 1980s but stabilized in the 1990s, while computer technology kept advancing.⁹

Institutions. Unions compress wages among men, so de-unionization raises male wage inequality; it accounts for a large part of the rise in male wage inequality in the United States and the United Kingdom since the early 1980s.¹⁰ US union membership fell from 20.1 percent of workers in 1983 to 10.0 percent in 2025.¹¹ Canadian unionization has declined much more slowly.

Union coverage and unionization rates, Canada

Employees aged 15 and over, annual averages

• Union coverage rate
• Unionization rate

Union coverage and membership rates of Canadian employees. Coverage fell from 33.7 percent in 1997 to 30.6 percent in 2025.Source: Statistics Canada, Table 14-10-0129-01, Union status by geography. Retrieved 2026-10-23.

Show the data and notes

Coverage rate: employees who are union members and/or covered by a collective agreement, as a share of all employees. Unionization rate: union members only. Labour Force Survey, both genders, 10 provinces. Statistics Canada cautions that 2006 changes to LFS processing may have shifted levels; compare across 2006 with care.

Period	Union coverage rate	Unionization rate
1997	33.7%	30.9%
1998	33.0%	30.5%
1999	32.3%	29.9%
2000	32.3%	30.1%
2001	32.3%	30.2%
2002	32.2%	30.1%
2003	32.2%	30.1%
2004	31.7%	29.8%
2005	32.0%	29.8%
2006	31.6%	29.2%
2007	31.3%	29.1%
2008	31.0%	28.8%
2009	31.5%	29.4%
2010	31.4%	29.3%
2011	30.8%	28.8%
2012	30.9%	28.9%
2013	30.9%	28.8%
2014	30.2%	28.1%
2015	30.4%	28.2%
2016	30.0%	28.0%
2017	30.0%	28.0%
2018	29.6%	27.6%
2019	29.8%	27.8%
2020	31.0%	29.1%
2021	30.7%	28.9%
2022	30.4%	28.2%
2023	30.5%	28.4%
2024	30.2%	28.3%
2025	30.6%	28.5%

A falling real minimum wage widens the bottom of the distribution. The US federal minimum, worth $14.81 an hour in 2025 dollars in 1968, was worth $7.25 in 2025. The decline in its real value explains a substantial share of the rise in US wage inequality from 1979 to 1988, especially for women.¹² It cannot explain rising inequality among higher-paid workers: most of the growth since the late 1980s occurred above the median.¹

U.S. federal minimum wage, nominal and real

Hourly rate in effect in December; real values in 2025 dollars

The US federal minimum wage in 2025 dollars. Its real value peaked in 1968 and has fallen by about half since.Source: FRED, Federal Minimum Hourly Wage for Nonfarm Workers for the United States (FEDMINNFRWG), U.S. Department of Labor; deflated with FRED CPIAUCNS (CPI-U, all items, U.S. city average, not seasonally adjusted), U.S. BLS. Retrieved 2026-10-23.

Show the data and notes

Nominal: federal rate in force in December of each year (first set in October 1938) for workers covered by the original Fair Labor Standards Act; until 1978, groups brought in by the 1961 and 1966 amendments (and farm workers) had lower minimums. Real: nominal × CPI(2025) ÷ CPI(year), using annual-average CPI-U (CPIAUCNS, https://fred.stlouisfed.org/series/CPIAUCNS; the seasonally adjusted CPIAUCSL only starts in 1947). CPI averages with missing months: 2025 (11 months) — BLS did not collect October 2025 prices during the federal government shutdown and averages the remaining months, as here. Many states and cities set higher minimum wages.

Period	Real (2025 dollars)
1960	$10.89
1961	$12.39
1962	$12.24
1963	$13.14
1964	$12.97
1965	$12.77
1966	$12.40
1967	$13.51
1968	$14.81
1969	$14.04
1970	$13.27
1971	$12.72
1972	$12.32
1973	$11.60
1974	$13.06
1975	$12.56
1976	$13.01
1977	$12.22
1978	$13.08
1979	$12.86
1980	$12.11
1981	$11.86
1982	$11.18
1983	$10.83
1984	$10.38
1985	$10.03
1986	$9.84
1987	$9.49
1988	$9.12
1989	$8.70
1990	$9.36
1991	$10.05
1992	$9.75
1993	$9.47
1994	$9.23
1995	$8.98
1996	$9.75
1997	$10.33
1998	$10.17
1999	$9.95
2000	$9.63
2001	$9.36
2002	$9.22
2003	$9.01
2004	$8.78
2005	$8.49
2006	$8.22
2007	$9.08
2008	$9.79
2009	$10.88
2010	$10.70
2011	$10.38
2012	$10.17
2013	$10.02
2014	$9.86
2015	$9.85
2016	$9.73
2017	$9.52
2018	$9.30
2019	$9.13
2020	$9.02
2021	$8.61
2022	$7.98
2023	$7.66
2024	$7.44
2025	$7.25

In Canada, rising minimum wages after 2005 raised wages at the bottom faster than in the middle, and the resource boom compressed wages in Alberta, Saskatchewan and Newfoundland and Labrador by raising the pay of less-educated and younger workers most.¹³

Common mistakes

Traps on exams

• Shifting the wrong curve. More graduates shift relative supply right and lower the premium. A rising premium alongside rising relative supply requires relative demand to shift out.
• Confusing levels with ratios. Both wages can rise while the premium falls; inequality between groups depends on $w_S/w_U$, not on either wage alone.
• Giving $b_1$ the wrong sign. $b_1 = \delta - 1$, which is negative for any $\delta \lt 1$.
• Crediting the minimum wage with everything. It affects the bottom of the distribution only, so it cannot explain the growth of upper-tail inequality.

On the exam

For “use a graph to explain how shifts in supply and demand change wage inequality”, put $\log(w_S/w_U)$ on the vertical axis and $\log(L_S/L_U)$ on the horizontal axis. Draw a downward-sloping relative demand curve and a vertical relative supply curve, shift supply right, show the premium would fall (A to B), then shift demand out enough that the new equilibrium C is above A.

Check yourself

1.

How can an increase in the demand for skilled labour raise wage inequality?

1It shifts the relative demand curve for skilled labour out; with relative supply fixed in the short run, the skilled-unskilled wage ratio rises2It raises the number of skilled workers, which lowers the wage of unskilled workers3It shifts the relative supply curve of skilled labour to the right, raising the skill premium4It raises both wages by the same percentage, which widens the dollar gap but leaves inequality unchanged

Check answer

2.

Between 1980 and 2000 the relative supply of US college graduates rose and so did their relative wage. In the supply and demand model of skilled labour, what does this imply?

1Relative demand for skilled labour shifted out by more than enough to offset the increase in relative supply2Relative supply of skilled labour must have fallen3The relative demand curve slopes upward4Nothing, because relative wages are determined by institutions, not supply and demand

Check answer

3.

Why can the falling real minimum wage not explain most of the rise in US wage inequality since the late 1980s?

1Most of the growth in inequality since then occurred above the median, where the minimum wage has no direct effect2The real minimum wage rose throughout the 1980s and 1990s3Minimum wages affect only unionized workers4The minimum wage raises inequality only among workers with university degrees

Check answer

Practise more questions on this topic

Sources

1. Autor, D. H., Katz, L. F. and Kearney, M. S. (2008). Trends in U.S. wage inequality: Revising the revisionists. Review of Economics and Statistics, 90(2), 300 to 323. NBER working paper 11627. ↩ ↩² ↩³ ↩⁴

2. Goldin, C. and Katz, L. F. (2007). The race between education and technology: The evolution of U.S. educational wage differentials, 1890 to 2005. NBER working paper 12984. ↩ ↩²

3. Corak, M. (2013). Income inequality, equality of opportunity, and intergenerational mobility. Journal of Economic Perspectives, 27(3), 79 to 102. Average employment income of men aged 25 to 34 in 2009, from OECD data. ↩

4. Statistics Canada, 2021 Census, Table 98-10-0597-01: median employment income in 2020 by highest level of education, full-year full-time workers aged 25 to 54 (dataset ca-wages-by-education). ↩

5. Katz, L. F. and Murphy, K. M. (1992). Changes in relative wages, 1963 to 1987: Supply and demand factors. Quarterly Journal of Economics, 107(1), 35 to 78. NBER working paper 3927. The estimated equation is $\log(w_1/w_2) = -0.709 \log(x_1/x_2) + 0.033\,t + \text{constant}$, where $x_1/x_2$ is relative supply and $t$ is time in years. ↩ ↩²

6. Immigration, Refugees and Citizenship Canada, Comprehensive Ranking System criteria, Express Entry, retrieved October 2026. ↩

7. Autor, D. H., Dorn, D. and Hanson, G. H. (2013). The China syndrome: Local labor market effects of import competition in the United States. American Economic Review, 103(6), 2121 to 2168. NBER working paper 18054. ↩

8. Murray, A. (2017). The effect of import competition on employment in Canada: Evidence from the “China shock”. Centre for the Study of Living Standards, Research Report 2017-03. ↩

9. Card, D. and DiNardo, J. E. (2002). Skill-biased technological change and rising wage inequality: Some problems and puzzles. Journal of Labor Economics, 20(4), 733 to 783. NBER working paper 8769. ↩

10. Card, D., Lemieux, T. and Riddell, W. C. (2004). Unions and wage inequality. Journal of Labor Research, 25(4). NBER working paper 9473. ↩

11. US Bureau of Labor Statistics, Union members, 2025, released February 18, 2026. The 2025 estimate is not strictly comparable with other years because October 2025 survey data were not collected. ↩

12. DiNardo, J., Fortin, N. M. and Lemieux, T. (1996). Labor market institutions and the distribution of wages, 1973 to 1992: A semiparametric approach. Econometrica, 64(5), 1001 to 1044. NBER working paper 5093. ↩

13. Fortin, N. M. and Lemieux, T. (2015). Changes in wage inequality in Canada: An interprovincial perspective. Canadian Journal of Economics, 48(2), 682 to 713. ↩