Wage Dynamics and Racial and Ethnic Occupational Segregation Among Less-Educated Men in Metropolitan Labor Markets

Abstract

We assess whether occupational segregation in metropolitan labor markets is associated with the wages of, and contributes to racial/ethnic wage disparities among, less-educated men. To measure occupational segregation in metropolitan low wage markets, we create a segregation index measuring segregation between white, black, and Latino male high school-only educated workers and high school dropouts in 95 metropolitan labor markets utilizing a unique dataset of the structural characteristics of the ninety-five largest US metropolitan labor markets. We use regression, fixed effects, and generalized least squares estimation techniques to test whether this index is associated with wages and racial wage inequality among these men. The analyses reveal that in metropolitan labor markets characterized by more racial and ethnic segmentation in the low wage market, wages are lower among black and Latino men in particular, and racial-ethnic wage disparities among similarly less-educated white, black, and Latino men are higher.