Black and Latinx workers reap lower rewards than White workers from years spent working in big cities

The large labor markets of big cities offer greater possibilities for workers to gain skills and experience through successively better employment opportunities. This "experience effect" contributes to the higher average wages that are found in big cities compared to the economy as a whole. Racial wage inequality is also higher in bigger cities than in the economy on average. We offer an explanation for this pattern, demonstrating that there is substantial racial inequality in the economic returns to work experience acquired in big cities. Using data from the National Longitudinal Survey of Youth, 1979 we find that each year of work experience in a big city increases Black and Latinx workers' wages by about one quarter to half as much as White workers' wages. A substantial amount of this inequality can be explained by further racial disparities in the benefits of high-skill work experience. This research identifies a heretofore unknown source of inequality that is distinctly urban in nature, and expands our knowledge of the challenges to reaching interracial wage equality.

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Publication Details

Journal
Proceedings of the National Academy of Sciences
Published
2025-02-04
DOI
https://doi.org/10.1073/pnas.2409935122
Citations
4
Primary Topic
Urban, Neighborhood, and Segregation Studies
Type
article
Field-Weighted Citation Impact
16.81

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article

Black and Latinx workers reap lower rewards than White workers from years spent working in big cities

Michael Storper, Maximilian Buchholz
4 citations
Proceedings of the National Academy of Sciences
Urban, Neighborhood, and Segregation Studies
16.81
article

Black and Latinx workers reap lower rewards than White workers from years spent working in big cities

Michael Storper, Maximilian Buchholz
article en
4 citations

Abstract

The large labor markets of big cities offer greater possibilities for workers to gain skills and experience through successively better employment opportunities. This "experience effect" contributes to the higher average wages that are found in big cities compared to the economy as a whole. Racial wage inequality is also higher in bigger cities than in the economy on average. We offer an explanation for this pattern, demonstrating that there is substantial racial inequality in the economic returns to work experience acquired in big cities. Using data from the National Longitudinal Survey of Youth, 1979 we find that each year of work experience in a big city increases Black and Latinx workers' wages by about one quarter to half as much as White workers' wages. A substantial amount of this inequality can be explained by further racial disparities in the benefits of high-skill work experience. This research identifies a heretofore unknown source of inequality that is distinctly urban in nature, and expands our knowledge of the challenges to reaching interracial wage equality.

Proceedings of the National Academy of SciencesVol. 122(6)
University of California System (US), London School of Economics and Political Science (GB)
National Science Foundation
Decent work and economic growth
Openalex Percentile: Top 1%
Urban, Neighborhood, and Segregation Studies
16.81
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Black and Latinx workers reap lower rewards than White workers from years spent working in big cities — Michael Storper, Maximilian Buchholz · Proceedings of the National Academy of Sciences (2025) | TGRS Research Map | TGRS