Real wage cyclicality and the Great Depression: evidence from British engineering and metal working firms

摘要

Based on firm‐level payroll data from around 2000 member firms of the British Engineering Employers’ Federation we examine the behavior of real hourly earnings over the 1927‐1937 cycle that contained the Great Depression. The pay statistics are based on adult male blue‐collar workers within engineering and metal working firms. They allow us to distinguish between pieceworkers and timeworkers and they are delineated by 14 occupations and 51 travel‐to‐work geographical engineering districts. We measure the cycle using national unemployment rates as well as rates that match our district breakdowns. Differences are found in the real hourly earnings cyclicality of pieceworkers and timeworkers. We attempt to relate our findings to those of modern micro panel data studies of real wage cyclicality. We offer some insight into why the estimates of real hourly pay display less procyclicality during the 1920s and 1930s than in studies based on more recent data.