EMPLOYEES ARE EARNING MORE. BUT WHETHER THEY ARE PRODUCING MORE?

Abstract

Labor productivity and wages are both essential economic factors and the way they interrelate is a constant concern for the economists, as well as for employers and policy-makers. The purpose of this paper is to estimate to which extent is the variation of productivity consistent with the distribution of wages, employing two patterns of comparison: by region and by industry. For this purpose, we developed a revised form of the coefficient of structural changes in order to determine the regional/ sectoral dissimilarities between productivity and wage. To analyze the distribution of regions by the level of labor productivity and average wages, we have grouped the regions and identified the nature of the distribution. This allowed us to determine the trend of wages and productivity in the groups and differentiate them from the national average value.