Disappearing Middle or Vanishing Bottom? A Comment on Gregory*

Publisher Website
Google Scholar
Abstract
The ‘disappearing middle’ hypothesis suggests a relative growth of both low paid and high paid jobs, with a relative decline in the number of jobs in the middle of the distribution. The methodology underpinning Gregory's 1993 results (which supported the hypothesis for the Australian case) is challenged and an alternative approach outlined. The results show no ‘disappearing middle’ between 1985 and 1991 in Australia, when recorded job growth was substantial. This is pertinent to discussion of the effect of institutions and minimum wage laws on labour market outcomes.