Post-1945 wage levels in Scandinavia

Talk by Jan Pedersen (SAXO Institute).

Abstract

The public used to direct considerable attention towards the development in private sector wages. That was the case, at least, when manufacturing industries passed their apex in terms of employment – by then overwhelmingly blue-collar employment.

Earned income of ordinary workers represented productive activity’s translation into spending power within a more and more equitable society: Gaps between various segments diminished. With the formation of the globalized service and information society, focus shifted.

Aided by methodological innovation and better data, social researchers now concern themselves less with the social differentiation and resource base for power that was formerly associated with collective pay structure. Increasingly, they see the size of wages or salaries as determined by a wider set of variables, with emphasis on human capital endowment.

In political discourse, preoccupation with income differentials has moved away from the situation of the lower wage brackets towards the abstract, overall degree of inequality in society. Examples of relevant issues within this context are the concentration of wealth in the topmost percentile, prolonged dependency on transfer income, and the insider/outsider-split among active workers. Implicitly, everybody in stable employment under reasonable conditions of work form one single well-to-do group. Within these confines, differences in pay are facts of life due to the premium market forces set on different qualities of labor.

In my presentation, I question the notion that wage levels no longer indicate structural dividing lines in society but merely tell which employees get more or less money by the end of the month. Long-term development in wage structure is illustrated by samples of descriptive statistics.

This talk is part of the Economic History Seminar.