Wage Inequality and Labor Rights Violations
49 Pages Posted: 22 Feb 2021 Last revised: 22 Apr 2023
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Wage Inequality and Labor Rights Violations
Wage Inequality and Labor Rights Violations
Date Written: February 2021
Abstract
Wage inequality does not fully capture differences in job quality. Jobs also differ along other key dimensions, including the prevalence of labor rights violations. We construct novel measures of labor violation rates using data from federal agencies. Within local industries over time, a 10% increase in the average wage is associated with a 0.15% decrease in the number of violations per employee and a 4% decrease in fines per dollar of pay. Reduced labor market concentration and increased union coverage rate are also associated with reductions in labor violations. Overall, labor violations are regressive: they increase inequality in job quality.
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