Columns 2 and 5 show that AFQT score has as 4. The sample in the present study includes more people who do not work very often. A significant portion of the difference reflects the fact that the present sample contains an additional ninety-seven workers with very weak attachment tO the labor market. Dependent variable is log wage rate, where the wage rate is the average real wage rate over 1990- 93. Sample includes respondents with valid AFQT scores and born after 1961 who report valid wage observations between 1990 and 1993.
Standard errors are in parentheses.
Basic cognitive skills, as measured by the AFQT, raise the wages of blacks at least as much as they raise the wages of whites. In short, basic skills do influence wages and a large fraction of the black-white wage gap reflects a skill gap that predates labor market entry. Earnings depend not only on hourly wages, but also on how many hours employees work. As we show below, difficulty in finding employment may also translate into less work experience and slower wage growth, which implies an additional drag on earnings growth for black workers. This phenomenon probably cannot be at- tributed to the fact that black men are offered lower wages.