Research On Earning Differentials Based On The Different Industries

Since the 80's from last century, China had created the world miracle that sustained high speed of national economy increase, but people didn't sufficiently enjoy the achievement of economic growth. At the present stage, there is more and more inequity during the stage of primary income distribution. According to production and income approach of national accounts, the total income from primary distribution comes from production, which is the sum of value-added production from the three strata of industry. Therefore, the inequity of the total income from primary distribution detailed shows as the inequity of primary distribution among different industries and industries' interior, that is the inequity of earning distribution based on different industries as we concerned. The research in this paper can contribute to the development of national economy and people's welfare improvement; also can have advantages of analysis of the practical income distribution pattern objectively and accurately, in order to provide a powerful practical and theoretical basis for reference for the government to draw up the related income distribution and industrial development policies.The core of this paper is from the perspective of the industrial structure, to study the earning differentials using dynamic and static analysis of the quantitative method and compositing average earning and labor share of the two indicators, in order to analyze and evaluate the equity and efficiency of income distribution. On this basis, the paper has analyzed influence factors using normative and positive analysis, and provides an important in-depth thinking of the decision-making for upgrading of industrial structure and income distribution system reform.The introduction in the paper mainly formulates the background of the issue and its significance, the domestic and international article reviews, the study methods, the main contents, the innovations and deficiencies.The first chapter is the theoretical basis. It focuses on carding the western theories of factors income distribution and Marx's theory of income distribution; analyzes the internal mechanism of the distribution based on production factors; collates and summarizes the theories of industry wage differentials. The analysis in this chapter makes a solid foundation for the next research. The second chapter comparative analyzes the differences in urban units' average earning and labor's income share among the secondary industry's interior , the tertiary industry's interior, different industries, different factors-intensive industries, between monopoly and non- monopoly sectors; summarizes the characteristics and laws of the earning changes and its difference changes based on different industries. The study shows that trends between the average earning and labor's income share based on the different industries are inconsistent; the main reason is the unreasonable growth rate of average earning, which is lower than the growth rate of labor productivity. The higher the industry level is, the higher earning is. Income distribution of various sectors within the same industry is also divided into different levels. Earning differentials tend to expand generally, mainly because of the differential change among the various industry categories, the different factors-intensive industries, between monopoly and non-monopoly industries.The third chapter with qualitative method carries out a detailed analysis of the earning influence factors from theory and practice in China. With equity and efficiency as the starting point, the influence factors are mainly attributed as following. The first one is the labor market segmentation in the market-oriented process of the factors, which is the process inequity of income distribution caused by factors such as the household registration system, employment system, the social security system, policies and regulations, market competition. The second one is the income distribution system, which integrating distribution according to work with distribution based on production factors has widened earning differentials in different industries in the short term, but in the long term will achieve to the equity of high-income level in different industries. The third one is the human capital characteristic, which is the factor influencing the starting point equity of the earning. The fourth one is the upgrading of the industrial structure, which is the efficiency factor causing difference in the earning. It affects the earning by the increase in the total quantity of the income distribution, changes in factor inputs, labor productivity, the demand for the high quality labors, supply and demand of factor market and production market.The fourth chapter carries out positive analysis on the influence factors of the average earning and labor's income share in accordance with the different industries classification and verifies the theoretical analysis results of the third chapter, as well as provides a favorable basis for policies. The study shows that the industry average length of education, all ages' proportion of employed persons, weekly working hours has significant effect on the industry average earning, the proportion of female workers has no significant effect, and the factors have varying degrees of impact on the average earning in different sectors. The industry comparative productivity, fixed asset investment per labor, average length of education, 35-49 years proportion of employed persons have significant effect on labor's income share. The industry comparative productivity is correlated negatively with labor's income share, others are positively with it, and the factors have varying degrees of impact on labor's income share in different sectors.The fifth chapter based on the forecast model shows that with the continuing escalation of the industrial structure, labor's income share of different industries will increase, and the differentials of inter-industry will gradually narrow. In response to the above analysis, it puts forward the corresponding policy recommendations: The first one is to promote the upgrading of the industrial structure, including vigorously developing the tertiary industry, promoting internal upgrade of the secondary industry. The second one is to speed up the establishment of a unified labor market, including relaxation of restrictions on labor mobility, to strengthen the mechanism to break the monopoly. The third one is to improve the price mechanism of the labor market, including the establishment of the normal growth of the wage mechanism, improve the system of minimum wage standards, the establishment of wage payment security system, and the establishment of mechanisms for collective wage negotiations. The fourth one is to improve the labor market service system, including the establishment and improvement of workforce vocational training system, improving the labor employment agency system, improving the labor information release system. The fifth one is to improve the legal system of the labor market, including the strengthening of labor legislation and law enforcement. The sixth one is the development of education to improve the quality of labor, including strengthening compulsory education, continuing to deepen higher education, accelerating the development of vocational education.