Wages for Young Workers Up to the Age of 40

Summary: This study compares the earnings trajectories of several recent cohorts of young workers with those of cohorts who entered the labour market in the late 1970s. The study combines threeversions of Statistics Canada's Longitudinal Worker file (LWF) and covers the 1978-to-2015period. The main finding is that the degree of wage convergence that recent cohorts of youngmen have achieved relative to the 1978 cohort depends critically on which segments of theearnings distribution are considered. By the time they reached 40, young men who entered thelabour market during the early 2000s and who were at the 75th or 90th percentile of the earningsdistribution had higher annual wages than their counterparts who entered the labour market inthe late 1970s. The opposite is true for young men who were at the 25th or 50th percentile of theearnings distribution. Hence, cross-cohort comparisons of age-earnings profiles of young menyield quite different conclusions, depending on the segment of the earnings distribution that isconsidered. In contrast, regardless of the segment of the earnings distribution considered, theannual wages at ages 39 to 40 and the cumulative annual wages generally increased acrosssuccessive cohorts of young female employees.