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eleven - Distribution and structure of pay
- Edited by John F. Ermisch, Robert E. Wright
-
- Book:
- Changing Scotland
- Published by:
- Bristol University Press
- Published online:
- 20 January 2022
- Print publication:
- 01 July 2005, pp 159-184
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- Chapter
- Export citation
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Summary
Introduction
In 1999-2000, the average level of pay and the dispersion of pay in Scotland was lower than in London but virtually identical to the rest of England. However, these similarities between Scotland and the rest of England mask substantial differences in wage dynamics between the two. The principal focus of this chapter is to report these features of the Scottish and English labour markets and to explore some of the labour market dynamics that help explain the picture that had emerged by the end of the 1990s.
The average level of pay in Scotland would be expected to differ from that in England. The industrial and occupational structure of employment and the skill composition of the workforce are different in the two countries. Different proportions of the working population are employed in the public sector and the incidence of trade unionism differs between Scotland and England. Once we control for all these differences in the characteristics of the workforce in the two countries and are able to compare like-with-like, are Scots, on average, less well paid than their counterparts in England? And even if we find that average levels of pay are the same in Scotland and England, there may still be differences between them in the distribution of pay. Is pay inequality greater or smaller in Scotland than in England?
The long boom of the 1990s saw pay levels grow steadily throughout the UK. Did this growth in pay mean that pay in Scotland became more similar to that in England or did pay levels diverge? Recognising that some people will be poorly paid in both countries, is it easier to escape low pay in Scotland than in England?
Even when pay is growing, not all individuals necessarily gain. Some experience pay reductions, others experience periods of unemployment and some even leave the labour force altogether. During the 1990s, the unemployment differential between Scotland and England grew. The Scottish unemployment rate, measured on the International Labour Organisation (ILO) definition and expressed as an index of the rate in the rest of England, was 106 on average during 1991and 1992.
five - Residential mobility
- Edited by John F. Ermisch, Robert E. Wright
-
- Book:
- Changing Scotland
- Published by:
- Bristol University Press
- Published online:
- 20 January 2022
- Print publication:
- 01 July 2005, pp 63-82
-
- Chapter
- Export citation
-
Summary
Introduction
In a dynamic economy, people are always moving residence. Having a child, getting married, separated or divorced, obtaining a job – these have all been identified as triggers in the mobility process. Regardless of the driving forces, residential mobility is generally regarded as being good for the economy and the prosperity of individuals. The basic argument is that mobility generates a convergence in incomes and employment. Regions experiencing strong economic growth will exhibit wage growth, encouraging a movement of labour into the region, raising labour supply and so forcing down wages. Depressed regions experience a movement out of labour, reducing labour supply and driving up wages.
However, the degree of residential mobility in Britain is regarded as low especially compared to the US (Gregg et al, 2004). According to recent research, around one in 10 households in Britain relocates each year (Hughes and McCormick, 2000). The removal vans, however, do not move far since only one in every 100 moves is inter-regional. At the same time, however, quasi-mobility has increased via rises in commute distances and times (Benito and Oswald, 1999).
This chapter represents an initial exploration of residential mobility in Scotland relative to England. At the outset, one would expect differences arising from differences in unemployment, earnings, occupational and industrial profile, education and also housing tenure across the two countries. The questions we seek to address are the following:
1) How much residential mobility is there in Scotland relative to England?
2) What types of moves do individuals make?
3) What factors drive such mobility?
In essence, we try to ascertain whether the types of regularities that have been found for Britain as a whole also hold for Scotland.
A brief review of the literature
The classical approach to migration argues that households will move away from regions that offer low wages and higher unemployment to regions or areas that offer high wages and lower unemployment. Most theoretical models assume that migration is determined by expected utility flows. Potential migrants make a comparison of the stream of expected future benefits from moving with the immediate costs. A household will move if the expected gains from moving net of transaction costs are greater than the expected utility from staying put.