Inter-industry wage differentials in Great Britain

The payer considers the determination of earnings of private sector employees in Great Britain, focusing upon the importance of industry affiliation in this process. Whilst cross-sectional estimates, using waves 1 to 4 of the British Household Panel Survey, suggest industry status is of considerable importance, much of this variation is removed by estimating earnings equations by fixed effects methods. Estimated differentials are not inversely related to the steepness of age-earnings profiles in an industry, do not appear to vary over time and are positively related to industry profitability.