Earnings profiles of Finnish wage earners in 2000–2010

Abstract

The employee’s salary normally increases with age and experience, but for how long? The purpose of this discussion paper is to investigate the age-wage profile with the help of register data. A trajectory analysis has been applied to the categorization of the register data, based on which six different groups in wage development have been identified. Taking various background factors into account, the wage profiles of the groups are modeled using a mixed statistical model. According to the results, the wage development of Finnish employees in relation to age takes the form of an undulating, up-and-down profile, the shape and peaks of which vary according to the wage group.