The Atlanta Fed's macroblog provides commentary and analysis on economic topics including monetary policy, macroeconomic developments, inflation, labor economics, and financial issues.
- BLS Handbook of Methods
- Bureau of Economic Analysis
- Bureau of Labor Statistics
- Congressional Budget Office
- Economic Data - FRED® II, St. Louis Fed
- Office of Management and Budget
- Statistics: Releases and Historical Data, Board of Governors
- U.S. Census Bureau Economic Programs
- White House Economic Statistics Briefing Room
September 30, 2016
A Quick Pay Check: Wage Growth of Full-Time and Part-Time Workers
In the last macroblog post we introduced the new version of the nominal Wage Growth Tracker, which allows a look back as far as 1983. We have also produced various cuts of these data comparable to the ones on the Wage Growth Tracker web page to look at the wage dynamics of various types of workers. One of the data cuts compares the median wage growth of people working full-time and part-time jobs. As we have highlighted previously, the median wage growth of part-time workers slowed by significantly more than full-time workers in the wake of the Great Recession. The extended time series allows us to look back farther to see if this phenomenon was truly unique.
The following chart shows the extended full-time/part-time median wage growth time series at an annual frequency.
The chart shows that the median wage increase for part-time workers is generally lower than for full-time workers, with the average gap about 1 percentage point. The reason for the presence of a gap is a bit puzzling. Could it be that part-time workers have lower average productivity growth than full-time workers? It is true that a part-time worker in our data set is more likely to lack a college degree than a full-time worker, and the median wage level for part-time workers is lower than for full-time workers. But interestingly, a reasonably systematic wage growth gap still exists after controlling for differences in the education and age of workers. So even highly educated prime-age, part-time workers tend to have lower median wage growth than their full-time counterparts. If it's a productivity story, its subtext is not easily captured by observed differences in education and experience.
Changes in economic conditions might also be playing a role. The wage growth gap exceeded 2 percentage points in the early 1980s and again between 2011 and 2013, both periods of considerable excess slack in the labor market, as we recently discussed here. In fact, in each of 2011, 2012, and 2013, half of the part-time workers in our dataset experienced no increase in their rate of pay at all.
To explore this possibility further, it's useful to separate part-time workers into those who work part-time because of economic conditions (for example, because of slack work conditions at their employer or their inability to find full-time work) from those who work part-time for noneconomic reasons (for example, because they have family responsibilities or because they are also in school). The following chart shows the median wage growth for full-time, voluntary part-time, and involuntary part-time workers.
Admittedly, there are not that many observations on involuntary part-time workers in our data set. But it does appear that their median wage growth has tended to slow by more after economic downturns than those working part-time for a noneconomic reason—at least prior to the Great Recession. After the last recession, however, the wage growth gap was just about as large for both types of part-time workers. In that sense, the impact of the last recession on the median wage growth of regular part-time workers was quite unusual.
Since 2013, median wage growth for part-time workers has been rising, which is good news for those workers and consistent with the labor market becoming tighter. With the unemployment rate reasonably low, employers might have to worry a bit more about retaining and attracting part-time staff than they did a few years ago.
- Making Analysis of the Current Population Survey Easier
- Mapping the Financial Frontier at the Financial Markets Conference
- The Tax Cut and Jobs Act, SALT, and the Blue State Blues: It's All Relative
- Improving Labor Force Participation
- Young Hispanic Women Investing More in Education: Good News for Labor Force Participation
- A Different Type of Tax Reform
- X Factor: Hispanic Women Drive the Labor-Force Comeback
- Tariff Worries and U.S. Business Investment, Take Two
- Trends in Hispanic Labor Force Participation
- Quantitative Frightening?
- July 2019
- June 2019
- May 2019
- March 2019
- February 2019
- January 2019
- December 2018
- November 2018
- October 2018
- August 2018
- Business Cycles
- Business Inflation Expectations
- Capital and Investment
- Capital Markets
- Data Releases
- Economic conditions
- Economic Growth and Development
- Exchange Rates and the Dollar
- Fed Funds Futures
- Federal Debt and Deficits
- Federal Reserve and Monetary Policy
- Financial System
- Fiscal Policy
- Health Care
- Inflation Expectations
- Interest Rates
- Labor Markets
- Latin America/South America
- Monetary Policy
- Money Markets
- Real Estate
- Saving, Capital, and Investment
- Small Business
- Social Security
- This, That, and the Other
- Trade Deficit
- Wage Growth