Labour Market Rewards and the Neo-Classical Soup

Abstract

Earlier research indicates clear gaps in wages and wage mobility between social classes. However, it has been argued that classes may be in the process of dissolving. Using Swedish cross-sectional and panel data, the following conclusions are drawn. The mismatch between class and economic reward increased in the last quarter of the 20th century, i.e. the data show a growing proportion of people whose wages are similar to those in other classes despite diverging mean differences in wages classes in the 1990s. Two processes are detected explaining this development: (1) changing age effects in the working class and (2) a dramatically widening sector cleavage within the service class. It is argued that these processes have implications for two of the main tasks of class analysis, i.e. assessing the development of inequality of opportunity and using class as an explanatory factor.