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employment protection in NI and the RoI are likely to be broadly similar.
Over this period, the RoI labor market has been subject to much higher levels of economic volatility, due principally to the highly open nature of the Irish economy, compared to the NI labor market, which is generally perceived as being less subject to national and international shocks, in part due to its heavier reliance on public sector employment. Public sector jobs are estimated to account for over 30% of total employment in NI, compared to a UK average of 17% ( McFlynn, 2015 ) and a figure of
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for the same period. We proceed by first implementing a standard Blinder–Oaxaca (BO) decomposition exercise ( Blinder, 1973 and Oaxaca, 1973 ), augmented with employer-level characteristics. This exercise allows us to quantify separately the parts of average wage changes that are due to changes in employers’ and those due to changes in workers’ average characteristics in the economy. Since matched employer–employee datasets were previously not easily available, the firm side of the adjustment has often been neglected in the earlier literature. Recently, some