Evidence from North American pay practices was used to examine the question of whether the "old employment contact," according to which employees promised to exchange hard work for job security, has truly been replaced by a "new employment contract" based more on market forces. The study analyzed data from the following sources: (1) the Current Population Survey (CPS) with Benefits Supplements; (2) a survey by the Hay Consulting Group; (3) the Cleveland Salary Survey (CSS); (4) the Indiana/Japan data set; and (5) the Fairness Survey. The study documented the rising overall inequality in wages that others have observed. The rising returns on skills emerged as the main change in the labor market in recent years. Little evidence was found to support the theory that shocks to product markets (deregulation and rising imports) or to labor markets (local unemployment rates and wage rates) affect the level of wages paid by large employers. The following items are appended: an illustrative model of human capital theory; discussions of the study data sets; a discussion of whether deregulation or growing imports have weakened wage structures; and a discussion and the complete results of the layoff questions. (Contains 222 references and 54 tables/figures.) (MN)