The Distribution of Earnings in New Zealand

Changes in the distribution of individual earnings between 1984 and 1995 are examined using data from the Household Economic Survey. Several dimensions of changes in the earnings structure are considered, including measures of aggregate earnings inequality, the gender earnings gap and shifts in relative earnings by level of educational attainment. Changes in the variance of earnings are decomposed to identify more clearly the source of the tendencies towards and against greater inequality. Evidence is found of a rise in hourly earnings inequality among males over the decade. However, the effects of this trend on the total earnings distribution were offset by a rise in the female share of employment and a narrowing of the gap between male and female average hourly earnings.