Determinants of Hourly Earnings and Earnings Inequality: Analyses on Italian Data from the Structure of Earnings Survey

Abstract

The study examines the differences in hourly earnings among employees, which can contribute to an unequal distribution of income with implications for equity and social cohesion. The analyses apply a log-linear regression model to data from the Structure of Earnings Survey (SES). The method allows highlighting whether and to what extent certain categories of employees are disadvantaged compared to others. The findings reveal substantial and persistent wage differentials associated with gender, education, occupation, contract type, firm size and geographical location. In particular, women earn significantly less than men even after controlling for observable factors, and higher educational attainment is strongly rewarded, though unevenly across sectors. Territorial gaps also remain pronounced, especially between the North-West and the South. These results underscore the importance of targeted labour market policies aimed at reducing structural disparities and improving wage equity across demographic groups and regions.