In this paper we study the distribution of earnings in Austria from 1972 to 1991 using previously not available data. We find income compression in the early eighties, followed by a gradual reversal by the end of the observation period. Overall the lowest quartile and the highest decile gained at the expense of the middle class. Decomposition of the overall trend into sex and skill categories shows that within-group changes explain most of the development: inequality within blue-collar workers decreased, the opposite applies to white-collar workers.