Archived — Working Paper Number 12: Implications of Technology and Imports on Employment and Wages in Canada

by Frank C. Lee, Industry Canada, July 1996


Summary

This paper analyses the net effects of technology and import competition on employment, wages and wage inequality in the Canadian manufacturing sector over the period 1970–1990 by estimating reduced-form employment and wage equations. The analysis uses non-production and production workers to distinguish between two categories of labour. For each group, the number of person-hours worked, the level of employment and the hourly labour compensation by industry are examined. The major findings from the study are as follows (1) the growth of employment and of real hourly labour compensation in the Canadian manufacturing sector is positively related to technical progress and to the price of imports, (2) the relative employment of non-production to production workers is negatively related to technical progress, while the relative real hourly labour compensation of non-production to production workers is positively associated with technical progress, (3) the relative employment of non-production to production workers is negatively related to the price of imports, but the relative real hourly labour compensation of non-production to production workers is positively associated with the price of imports.

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