Wages, Employer Size-Wage Premia and Employment Structure: Their Relationship to Advanced-Technology Usage at U.S. Manufacturing Establishments
December 1992
Working Paper Number:
CES-92-15
Abstract
We study wages, size-wage premia and the employment structure (measured as the fraction of production workers in an establishment) and their relationship to the extent of advanced-technology usage at U.S, manufacturing plants. We begin by sketching a model of technology adoption based on Lucas (1978) that provides a framework for interpreting the data analysis. We then study a new Census Bureau survey of technology use at manufacturing plants. Workers in establishments that are classified as the most technology intensive earn a premium of 16 percent as compared to those in plants that are the least premium earned by workers in all but the very largest plants. The inclusion of the technology classification variables in standard wage regressions reduced the size-wage premia by as much as 60 percent for some size categories.
Document Tags and Keywords
Keywords
Keywords are automatically generated using KeyBERT, a powerful and innovative
keyword extraction tool that utilizes BERT embeddings to ensure high-quality and contextually relevant
keywords.
By analyzing the content of working papers, KeyBERT identifies terms and phrases that capture the essence of the
text, highlighting the most significant topics and trends. This approach not only enhances searchability but
provides connections that go beyond potentially domain-specific author-defined keywords.
:
demand,
economist,
manufacturing,
payroll,
industrial,
survey,
technology,
earnings,
technological,
tech,
employee,
employ,
employed,
labor,
technology adoption,
workforce,
employing,
wage regressions,
employment production,
wages employment,
worker wages,
worker
Tags
Tags are automatically generated using a pretrained language model from spaCy, which excels at
several tasks, including entity tagging.
The model is able to label words and phrases by part-of-speech,
including "organizations." By filtering for frequent words and phrases labeled as "organizations", papers are
identified to contain references to specific institutions, datasets, and other organizations.
:
Census of Manufactures,
Standard Industrial Classification,
American Statistical Association,
National Science Foundation,
Center for Economic Studies,
Federal Reserve Bank,
Fabricated Metal Products,
Survey of Manufacturing Technology,
Computer Aided Design
Similar Working Papers
Similarity between working papers are determined by an unsupervised neural
network model
know as Doc2Vec.
Doc2Vec is a model that represents entire documents as fixed-length vectors, allowing for the
capture of semantic meaning in a way that relates to the context of words within the document. The model learns to
associate a unique vector with each document while simultaneously learning word vectors, enabling tasks such as
document classification, clustering, and similarity detection by preserving the order and structure of words. The
document vectors are compared using cosine similarity/distance to determine the most similar working papers.
Papers identified with 🔥 are in the top 20% of similarity.
The 10 most similar working papers to the working paper 'Wages, Employer Size-Wage Premia and Employment Structure: Their Relationship to Advanced-Technology Usage at U.S. Manufacturing Establishments' are listed below in order of similarity.
-
Working PaperThe Effect Of Technology Use On Productivity Growth
April 1996
Working Paper Number:
CES-96-02
This paper examines the relationship between the use of advanced technologies and productivity and productivity growth rates. We use data from the 1993 and 1988 Survey of Manufacturing Technology (SMT) to examine the use of advanced (computer based) technologies at two different points in time. We are also able to combine the survey data with the Longitudinal Research Database (LRD) to examine the relationships between plant performance, plant characteristics, and the use of advanced technologies. In addition, a subset of these plants were surveyed in both years, enabling us to directly associate changes in technology use with changes in plant productivity performance. The main findings of the study are as follows. First, diffusion is not the same across the surveyed technologies. Second, the adoption process is not smooth: plants added and dropped technologies over the six-year interval 1988-93. In fact, the average plant showed a gross change of roughly four technologies in achieving an average net increase of less than one new technology. In this regard, technology appears to be an experience good: plants experiment with particular technologies before deciding to add additional units or drop the technology entirely. We find that establishments that use advanced technologies exhibit higher productivity. This relationship is observed in both 1988 and 1993 even after accounting for other important factors associated with productivity: size, age, capital intensity, labor skill mix, and other controls for plant characteristics such as industry and region. In addition, the relationship between productivity and advanced technology use is observed both in the extent of technologies used and the intensity of their use. Finally, while there is some evidence that the use of advanced technologies is positively related to improved productivity performance, the data suggest that the dominant explanation for the observed cross-section relationship is that good performers are more likely to use advanced technologies than poorly performing operations.View Full Paper PDF
-
Working PaperEnergy Intensity, Electricity Consumption, and Advanced Manufacturing Technology Usage
July 1993
Working Paper Number:
CES-93-09
This paper reports on the relationship between the usage of advanced manufacturing technologies (AMTs) and energy consumption patterns in manufacturing plants. Using data from the Survey of Manufacturing Technology and the 1987 Census of Manufactures, we model the energy intensity and the electricity intensity of plants as functions of AMT usage and plant age. The main findings are that plants which utilize AMTs are less energy intensive than plants not using AMTs but consume proportionately more electricity as a fuel source. Additionally, older plants are generally more energy intensive and rely on fossil fuels to a greater extent than younger plants.View Full Paper PDF
-
Working PaperTechnology Use and Worker Outcomes: Direct Evidence from Linked Employee-Employer Data
August 2000
Working Paper Number:
CES-00-13
We investigate the impact of technology adoption on workers' wages and mobility in U.S. manufacturing plants by constructing and exploiting a unique Linked Employee-Employer data set containing longitudinal worker and plant information. We first examine the effect of technology use on wage determination, and find that technology adoption does not have a significant effect on high-skill workers, but negatively affects the earnings of low-skill workers after controlling for worker-plant fixed effects. This result seems to support the skill-biased technological change hypothesis. We next explore the impact of technology use on worker mobility, and find that mobility rates are higher in high-technology plants, and that high-skill workers are more mobile than their low and medium-skill counterparts. However, our technology-skill interaction term indicates that as the number of adopted technologies increases, the probability of exit of skilled workers decreases while that of unskilled workers increases.View Full Paper PDF
-
Working PaperThe Demand for Human Capital: A Microeconomic Approach
December 2001
Working Paper Number:
CES-01-16
We propose a model for explaining the demand for human capital based on a CES production function with human capital as an explicit argument in the function. The resulting factor demand model is tested with data on roughly 6,000 plants from the Census Bureau's Longitudinal Research Database. The results show strong complementarity between physical and human capital. Moreover, the complementarity is greater in high than in low technology industries. The results also show that physical capital of more recent vintage is associated with a higher demand for human capital. While the age of a plant as a reflection of learning-by-doing is positively related to the accumulation of human capital, this relation is more pronounced in low technology industries.View Full Paper PDF
-
Working PaperEvidence on the Employer Size-Wage Premium From Worker-Establishment Matched Data
August 1994
Working Paper Number:
CES-94-10
In spite of the large and growing importance of the employer size-wage premium, previous attempts to account for this phenomenon using observable worker or employer characteristics have met with limited success. The primary reason for this lack of success has been the lack of suitable data. While most theoretical explanations for the size-wage premium are based on the matching of employer and employee characteristics, previous empirical work has relied on either worker surveys with little information about a worker's employer, or establishment surveys with little information about workers. In contrast, this study uses the newly created Worker-Establishment Characteristic Database, which contains linked employer-employee data for a large sample of manufacturing workers and establishments, to examine the employer size-wage premium. The main results are: 1) Examining the cross-plant distribution of the skill of workers shows that managers with larger observable measures of skill work in large plants and firms with production workers with larger observable measures of skill. 2) Results from reduced form wage regressions show that including measures of the amount or type of capital in a worker's plant eliminates the establishment size-wage premium. 3) These results are robust to efforts at correcting for possible bias in the parameter estimates due to sample selection. While these findings are consistent with neoclassical explanations for the size-wage premium that hypothesize that large employers employ more skilled workers, their primary importance is that they show that the employer size-wage premium can be accounted for with employer-employee matched data. As such, these data lend support to models which emphasize the role of employer-employee matching in accounting for both cross-sectional and dynamic aspects of the wage distribution.View Full Paper PDF
-
Working PaperAutomation and the Workforce: A Firm-Level View from the 2019 Annual Business Survey
April 2022
Working Paper Number:
CES-22-12R
This paper describes the adoption of automation technologies by US firms across all economic sectors by leveraging a new module introduced in the 2019 Annual Business Survey, conducted by the US Census Bureau in partnership with the National Center for Science and Engineering Statistics (NCSES). The module collects data from over 300,000 firms on the use of five advanced technologies: AI, robotics, dedicated equipment, specialized software, and cloud computing. The adoption of these technologies remains low (especially for AI and robotics), varies substantially across industries, and concentrates on large and young firms. However, because larger firms are much more likely to adopt them, 12-64% of US workers and 22-72% of manufacturing workers are exposed to these technologies. Firms report a variety of motivations for adoption, including automating tasks previously performed by labor. Consistent with the use of these technologies for automation, adopters have higher labor productivity and lower labor shares. In particular, the use of these technologies is associated with a 11.4% higher labor productivity, which accounts for 20'30% of the difference in labor productivity between large firms and the median firm in an industry. Adopters report that these technologies raised skill requirements and led to greater demand for skilled labor, but brought limited or ambiguous effects to their employment levels.View Full Paper PDF
-
Working PaperImpacts of Trade on Wage Inequality in Los Angeles: Analysis Using Matched Employer-Employee Data
April 2006
Working Paper Number:
CES-06-12
Over the past twenty-five years, earnings inequality has risen dramatically in the US, reversing trends of the preceding half-century. Growing inequality is closely tied to globalization and trade through the arguments of Heckscher-Ohlin. However, with only few exceptions, empirical studies fail to show that trade is the primary determinant of shifts in relative wages. We argue that lack of empirical support for the trade-inequality connection results from the use of poor proxies for worker skill and the failure to control for other worker characteristics and plant characteristics that impact wages. We remedy these problems by developing a matched employer-employee database linking the Decennial Household Census (individual worker records) and the Longitudinal Research Database (individual manufacturing establishment records) for the Los Angeles CMSA in 1990 and 2000. Our results show that trade has a significant impact on wage inequality, pushing down the wages of the less-skilled while allowing more highly skilled workers to benefit from exports. That impact has increased through the 1990s, swamping the influence of skill-biased technical change in 2000. Further, the negative effect of trade on the wages of the less-skilled has moved up the skill distribution over time. This suggests that over the long-run, increasing levels of education may not insulate more skilled workers within developed economies from the impacts of trade.View Full Paper PDF
-
Working PaperTask Trade and the Wage Effects of Import Competition
January 2016
Working Paper Number:
CES-16-03
Do job characteristics modulate the relationship between import competition and the wages of workers who perform those jobs? This paper tests the claim that workers in occupations featuring highly routine tasks will be more vulnerable to low-wage country import competition. Using data from the US Census Bureau, we construct a pooled cross-section (1990, 2000, and 2007) of more than 1.6 million individuals linked to the establishment in which they work. Occupational measures of vulnerability to trade competition ' routineness, analytic complexity, and interpersonal interaction on the job ' are constructed using O*NET data. The linked employer-employee data allow us to model the effect of low-wage import competition on the wages of workers with different occupational characteristics. Our results show that low-wage country import competition is associated with lower wages for US workers holding jobs that are highly routine and less complex. For workers holding nonroutine and highly complex jobs, increased import competition is associated with higher wages. Finally, workers in occupations with the highest and lowest levels of interpersonal interaction see higher wages, while workers with medium-low levels of interpersonal interaction suffer lower wages with increased low-wage import competition. These findings demonstrate the importance of accounting for occupational characteristics to more fully understand the relationship between trade and wages, and suggest ways in which task trade vulnerable occupations can disadvantage workers even when their jobs remain onshore.View Full Paper PDF
-
Working PaperTechnology Usage in U.S. Manufacturing Industries: New Evidence from the Survey of Manufacturing Technology
October 1991
Working Paper Number:
CES-91-07
Using a new dataset on technology usage in U.S. manufacturing plants, this paper describes how technology usage varies by plant and firm characteristics. The paper extends the previous literature in three important ways. First, it examines a wide range of relatively new technologies. Second, the paper uses a much larger and more representative set of firms and establishments than previous studies. Finally, the paper explores the role of firm R&D expenditures in the process of technology adoption. The main findings indicate that larger plants more readily use new technologies, plants owned by firms with high R&D-to-sales ratios adopt technologies more rapidly, and the relationship between plant age and technology usage is relatively weak.View Full Paper PDF
-
Working PaperHow Workers Fare When Employers Innovate
May 2003
Working Paper Number:
CES-03-11
Complementing existing work on firm organizational structure and productivity, this paper examines the impact of organizational change on workers. We find evidence that employers do appear to compensate at least some of their workers for engaging in high performance workplace practices. We also find a significant association between high performance workplace practices and increased wage inequality. Finally, we examine the relationship between organizational structure and employment changes and find that some practices, such as self-managed teams, are associated with greater employment reductions, while other practices, such as the percentage of workers involved in job rotation, are associated with lower employment reductions.View Full Paper PDF
