This study examines the nature and sources of changes in the distribut
ions of earnings for full-time male and female employees in Australia
between 1975 and 1994. Measures of change in real earnings and in earn
ings inequality are constructed using grouped earnings data for 1975 t
o 1994, and individual-level earnings data for 1982, 1986 and 1990. Th
e effects on earnings inequality of changes in the skill composition o
f the workforce and in returns to skills are assessed through a variet
y of tests, and changes in earnings inequality in Australia are compar
ed with recent trends in other countries.