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on Labor Markets - Supply, Demand, and Wages |
| By: | Moens, Eline (Ghent University); Verhofstadt, Elsy (Ghent University); Van Ootegem, Luc (Ghent University); Baert, Stijn (Ghent University) |
| Abstract: | This research adds to the literature on the attractiveness of telework to employees. To this end, we set up an innovative factorial survey experiment in which a high-quality sample of employees evaluates job offers with diverging characteristics, among which a wide variation in telework possibilities. We find that the relationship between the possibility to telework and job attractiveness is approximately linear: 10 percentage points more telework hours yield a rise of 2.2 percentage points in job attractiveness and, therefore, the willingness to give up an increase of 2.3 percentage points in wage in the new job. Our experimental design also allows us to investigate the underlying mechanisms of this relationship as well as its moderators. We find that the attractiveness of telework is particularly explained by expectations of an improved work-life balance, more work scheduling autonomy, a higher job satisfaction, and more work methods autonomy in jobs with a greater possibility to telework. In addition, our analyses show that less conscientious employees are on average more attracted to jobs with greater telework possibilities, so that it is important that self-selection in jobs with more telework is well-monitored. |
| Keywords: | telework, job attractiveness, factorial survey experiment |
| JEL: | J24 J81 J31 J63 I31 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15190&r= |
| By: | Alejandra Bellatin; Gabriela Galassi |
| Abstract: | We use data from online job postings listed on a job board to study how the de- mand for jobs linked to new technologies during the COVID-19 crisis responded to pandemic mitigation policies. We classify job postings into a standard occupation classification, using text analytics, and we group occupations according to their involvement in the production and use of digital technologies. We leverage the variation in the stringency of containment policies over time and across provinces. We find that when policies become more stringent, job postings in occupations that are related to digital infrastructure that allow for remote work fare relatively better than postings in more traditional occupations. Job postings for positions in occupations with low risk of automation recover faster during reopenings than postings for more traditional occupations. Occupations typically populated by disadvantaged groups (e.g., women and low-wage workers) post relatively few job postings if they are not linked to new technologies. We also find that cities with scarce pre-pandemic job postings related to digital technologies post fewer job ads overall when policies become more stringent. |
| Keywords: | Coronavirus disease (COVID-19); Econometric and statistical methods; Labour markets |
| JEL: | J23 J24 O14 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocawp:22-17&r= |
| By: | Fabienne Kiener; Christian Eggenberger; Uschi Backes-Gellner |
| Abstract: | We study how information technology (IT) progress affects returns to specialization and social skills by developing a theoretical model and empirically analyzing its implications. Our model shows how IT progress can lead to increasing returns to specialization and social skills. Using rich skill data from Swiss occupational training curricula, we empirically investigate the wage returns to specialization and social skills depending on IT progress in different industries. Our individual fixed-effects analyses show that IT progress leads to increasing wage returns for specialized workers. Furthermore, our results suggest that workers with high shares of social skills benefit from IT progress only if they are also specialized. |
| Keywords: | digitalization, IT progress, skills, education, human capital |
| JEL: | I26 J24 O33 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0192&r= |
| By: | Koning, Pierre (Vrije Universiteit Amsterdam); Muller, Paul (Vrije Universiteit Amsterdam); Prudon, Roger (Free University Amsterdam) |
| Abstract: | Workers with fixed-term contracts typically have worse health than workers with permanent contracts. We show that these differences in health translate into a substantially higher (30%) risk of applying for disability insurance (DI) in the Netherlands. Using unique administrative data on health and labor market outcomes of all employees in the Netherlands, we decompose this differential into: (i) selection of workers types into fixed-term contracts; (ii) the causal impact of temporary work conditions on worker health; (iii) the impact of differential employer incentives to reintegrate ill workers; and (iv) the differential impact of labor market prospects on the decision to apply for DI benefits. We find that selection actually masks part of the DI risk premium, whereas the causal impact of temporary work conditions on worker health is limited. At the same time, the differences in employer commitment during illness and differences in labor market prospects between fixed-term and permanent workers jointly explain more than 80% of the higher DI risk. |
| Keywords: | disability insurance, temporary work, employer incentives, worker health |
| JEL: | J08 I1 J22 H53 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15173&r= |
| By: | Moritz Drechsel-Grau; Andreas Peichl; Johannes F. Schmieder; Kai D. Schmid; Hannes Walz; Stefanie Wolter |
| Abstract: | We provide a comprehensive analysis of income inequality and income dynamics for Germany over the last two decades. Combining personal income tax and social security data allows us – for the first time – to offer a complete picture of the distribution of annual earnings in Germany. We find that cross-sectional inequality rose until 2009 for men and women. After the Great Recession inequality continued to rise at a slower rate for men and fell slightly for women due to compression at the lower tail. We further document substantial gender differences in average earnings and inequality over the life-cycle. While for men earnings rise and inequality falls as they grow older, many women reduce working hours when starting a family such that average earnings fall and inequality increases. Men’s earnings changes are on average smaller than women’s but are substantially more affected by the business cycle. During the Great Recession, men’s earnings losses become magnified and gains are attenuated. Apart from recession years, earnings changes are significantly right-skewed reflecting the good overall state of the German labor market and increasing labor supply. In the second part of the paper, we study the distribution of total income including incomes of self-employed, business owners, and landlords. We find that total inequality increased significantly more than earnings inequality. Regarding income dynamics, entrepreneurs’ income changes are more dispersed, less skewed, less leptokurtic and less dependent on average past income than workers’ income changes. Finally, we find that top income earners have become less likely to fall out of the top 1 and 0.1 percent. |
| JEL: | E2 J16 J2 J3 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29818&r= |
| By: | Andrea Bassanini; Giulia Bovini; Eve Caroli; Jorge Casanova Ferrando; Federico Cingano; Paolo Falco; Florentino Felgueroso; Marcel Jansen; Pedro S. Martins; António Melo; Michael Oberfichtner; Martin Popp |
| Abstract: | We investigate the impact of labour market concentration on two dimensions of job quality, namely wages and job security. We leverage rich administrative linked employer-employee data from Denmark, France, Germany, Italy, Portugal and Spain in the 2010s to provide the first comparable cross-country evidence in the literature. Controlling for productivity and local product market concentration, we show that the elasticities of wages with respect to labour market concentration are strikingly similar across countries: increasing labour market concentration by 10% reduces wages by 0.19% in Germany, 0.22% in France, 0.25% in Portugal and 0.29% in Denmark. Regarding job security, we find that an increase in labour market concentration by 10% reduces the probability of being hired on a permanent contract by 0.46% in France, 0.51% in Germany and 2.34% in Portugal. While not affecting this probability in Italy and Spain, labour market concentration significantly reduces the probability of being converted to a permanent contract once hired on a temporary one. Our results suggest that considering only the effect of labour market concentration on wages underestimates its overall impact on job quality and hence the resulting welfare loss for workers. |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2022-04&r= |
| By: | Orsetta Causa; Michael Abendschein; Nhung Luu; Maria Chiara Cavalleri |
| Abstract: | This paper delivers new evidence for European countries on the role of a wide range of policies for workers’ mobility in terms of hiring transitions into jobs, with an emphasis on differences across socio-economic groups. Labour market transitions are relevant in the current context where the ongoing recovery from the COVID-19 crisis is characterised by labour shortages and at the same time still low employment in a number of countries. The analysis focuses on the probability to transition from unemployment and selected forms of inactivity (e.g. fulfilling domestic tasks, studying) to jobs and from one job to another. Results of this work show the strong association between hiring flows and the business cycle with specific patterns during recoveries, recessions and expansions. The analysis further reveals that a broad range of policies influence hiring transitions, such as labour market policies, taxes and social support programmes but also product market regulations and regulations affecting certain professions. Country-specific priorities will vary depending on context, challenges and social preferences. Yet common policy objectives at the current recovery context are likely to improve the job prospects of the non-employed, especially youth, low-skilled and women, to help the recovery, foster reallocation and to address labour shortages. |
| Keywords: | business cycle, COVID-19, cross-country data, differences across socio-economic groups, job mobility, labour reallocation, labour transitions, policy analysis, worker flows |
| JEL: | E24 E32 J2 J31 J62 |
| Date: | 2022–04–19 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1710-en&r= |
| By: | Guner, Nezih (Universitat Autònoma de Barcelona); Ruggieri, Alessandro (University of Nottingham) |
| Abstract: | For a large set of countries, we document how the labor earnings inequality varies with GDP per capita. As countries get richer, the mean-to-median ratio and the Gini coefficient decline. Yet, this decline masks divergent patterns: while inequality at the top of the earnings distribution falls, inequality at the bottom increases. We interpret these facts within a model economy with heterogeneous workers and firms, featuring industry dynamics, search and matching frictions, and skill accumulation of workers through learning-by-doing and on-the-job training. The benchmark economy is calibrated to the UK. We then study how the earnings distribution changes with distortions that penalize high-productivity firms and frictions that reduce match formation. Distortions and frictions reduce employment, average firm size, and GDP per capita. They also affect how much firms are willing to pay workers, how well high-skill workers are matched with high-productivity firms, and how much training workers receive. The model generates the observed cross-country relation between GDP per capita and earnings inequality, as well as a host of cross-country facts on firm size distribution, firms' training decisions, and workers' life-cycle and job tenure earnings profiles. |
| Keywords: | earnings inequality, labor market frictions, correlated distortions, human capital, on-the-job training, productivity, firm size, life-cycle earning proles |
| JEL: | E23 E24 J24 O11 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15174&r= |
| By: | Wolfgang Frimmel; Bernhard Schmidpeter (JKU); Rene Wiesinger (JKU); Rudolf Winter-Ebmer |
| Abstract: | We evaluate whether revealing wage information in job vacancies is able to change the gender wage gap. In 2011, the Austrian Equal Treatment Law mandated every vacancy to include a minimum wage offer. This mandatory wage information makes the employer’s willingness to pay and the value of outside options more salient to job applicants, thus changing bargaining options. Our general results show a small effect of the provision of wage information, reducing the gender gap somewhat. Taking up the bargaining argumentation, we split the sample into vacancies where a higher or a lower bargaining power of firms is to be expected and find a strong and significant reduction of the gender wage gap for jobs which are immediately available and need to be filled urgently. The effect is driven by an increase in female wages. There is no such effect for jobs positions which are not urgently vacant. There is no evidence for changes in vacancy characteristics, meaning the estimated effects come from the provision of wage information rather than different job descriptions and amenities offers. We also show that effects are unlikely to come from changes in the composition of employees and firms as well as from increased returns to labor market experience. |
| Keywords: | mandatory wage posting, pay transparency law, gender wage gap, job postings, quantile DID |
| JEL: | J31 J23 J63 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2022-02&r= |
| By: | Comi, Simona Lorena (University of Milan Bicocca); Grasseni, Mara (University of Bergamo); Origo, Federica (University of Bergamo) |
| Abstract: | This paper studies the impact on the length of school-to-work transition of a reform that extended from two to three years the short vocational track in Italy in the early 2000s. In the empirical analysis we use the Two Way Fixed Effect methodology to estimate the impact of the reform, exploiting its staggered implementation across regions. The analysis is restricted to graduates from the short vocational track before and after the reform. The results show that the reform had a positive impact and reduced school-to-work transition by around 5 months (a 24% reduction). Moreover, the new short vocational track proved to be extremely effective for migrants and females, whose school-to-work transition was reduced by 1.4 years and 0.9 years, respectively. In implementing the new short vocational track, some regions adopted a quasi-market organization in which private training institutions competed with public schools. This model proved to be more effective in shortening school-to-work transitions, in particular for migrants. This study makes an important contribution to the literature on the labor-market effect of vocational education by showing that lengthening the short vocational track, and changing the overall content of curricula, can speed up school-to-work transition. |
| Keywords: | school-to-work transition, vocational education, policy evaluation |
| JEL: | I26 I28 J24 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15176&r= |
| By: | Konstantin Kunze (Department of Economics, University of California Davis) |
| Abstract: | This paper exploits variation resulting from a series of federal and state Medicaid expansions between 1979 and 2014 to estimate the effects of child’s access to public health insurance on labor market outcomes of parents. The results imply that extended Medicaid eligibility of children leads to positive contemporaneous labor supply responses of both parents. The estimated effects are concentrated among mothers with non-white children and fathers with white children. |
| Keywords: | Labor Supply, Medicaid, Simulated Eligibility, Spillover Effects |
| JEL: | I13 I18 I38 J18 J21 J22 |
| Date: | 2022–04–20 |
| URL: | http://d.repec.org/n?u=RePEc:cda:wpaper:349&r= |
| By: | Schmid, Ramona |
| Abstract: | This study presents new evidence on immigrant-native wage differentials estimated in consideration of regional differences regarding the presence of Non-German population in metropolitan and non-metropolitan areas between 2000 and 2019 in Germany. Using linked employer-employee-data, unconditional quantile regression models are estimated in order to assess the degree of labor market integration of foreign workers. Applying an extended version of the Oaxaca-Blinder decomposition method, the results provide evidence on driving factors behind wage gaps along the entire wage distribution. There are not only changes in the relative importance of explanatory factors over time, but also possible sources of wage differentials shift between different points of the wage distribution. Differentiating between various areas in Germany, on average, larger wage gaps are revealed in metropolitan areas with at the same time a higher presence of the foreign population. Regarding the size of overall estimated wage gaps, after 2012 a reversal in trend and particular increasing tendencies around median wages are identified. |
| Keywords: | Immigrant-native wage gap,Oaxaca-Blinder decomposition,unconditional quantile regression,ethnic clustering,Germany |
| JEL: | J15 J31 J61 R23 R58 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:hohdps:042022&r= |
| By: | Paolo Emilio Mistrulli (Banca d'Italia); Tommaso Oliviero (University of Naples Federico II and CSEF); Zeno Rotondi (UniCredit, CERBE and MoFiR); Alberto Zazzaro (Department of Economics and Statistics, University of Naples Federico II) |
| Abstract: | In this paper we combine administrative data from the Italian National Institute for Social Security and proprietary data from a major Italian commercial bank to analyse the impact of job protection legislation on mortgage conditions. An exogenous change in the degree of job protection against individual dismissals of workers with open-ended contracts is identified by exploiting the 2015 Labor market reform, the so-called Jobs Act, which reduced employment protection of newly hired employees in medium and large private firms. We find that the weaker job security induced by the 2015 legislation change leads to a lower mortgage amount and a lower leveraging capacity, as measured by the loan-to-value ratio. Furthermore, the effect of job insecurity is mitigated by the presence of co-mortgagors while it is amplified for young and low-income mortgagors. |
| Keywords: | Employment protection law; job stability; mortgage market |
| JEL: | C21 G21 G51 J41 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wmofir:173&r= |
| By: | Giménez-Nadal; José Ignacio, Molina, José Alberto, Velilla; Jorge |
| Abstract: | Recent analyses have shown that commutes to and from work are not symmetric, suggesting that intermediate activities are at the root of these asymmetries. However, how intermediate activities interact with trips to and from work is an unexplored issue. Using data from the American Time Use Survey 2003-2019, we analyze what activities workers do while commuting, and compare measures of commuting when intermediate activities are included or excluded as part of the commuting trip. We show that commuting is underestimated if measured with the Time Use Survey lexicon. Such differences are especially significant in commuting from work. Furthermore, gender comparisons of commuting are affected by the inclusion of intermediate while commuting, with gender differences narrowing when intermediate activities are considered. Our results contribute to the analysis of commuting behavior, by proposing new identification strategies based on intermediate non-trip episodes, and by showing how commuting interacts with other non-commuting activities. |
| Keywords: | Commuting time,Trip behavior,Intermediate activity,Time use data,American Time Use Survey |
| JEL: | J22 R41 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1080&r= |
| By: | Rodríguez Torres, Omar (UNU-MERIT, Maastricht University) |
| Abstract: | This paper assesses the productive role of social policy. It analyses the effect that participating in social policy programmes has on business performance of enterprises in Cartagena, Colombia. To investigate these effects, we employ an instrumental variable analysis to account for the potential endogeneity of participation. Exploiting the existence of a partially complied eligibility rule for Participation in the poverty reduction programme we are able to identify the effect on several enterprise indicators. The paper contributes to the literature on entrepreneurship policies in developing countries from the social policy perspective. It sheds light on the effects and potential mechanisms that the participation on social policy schemes has on the entrepreneurial activity of household enterprises. The results show that complier participating entrepreneurs are more credit-oriented and work more hours per day. No statistically significant effect is found on profit measures. |
| Keywords: | Social policy, poverty reduction, entrepreneurship, public policy, enterprise policy |
| JEL: | I31 I32 L26 J48 L53 O15 O35 |
| Date: | 2022–03–18 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2022010&r= |
| By: | Mathilde Bouvier (Université Paris-Dauphine); François Roubaud (DIAL-LEDa, IRD, Université Paris-Dauphine, PSL Université); Mireille Razafindrakoto (DIAL-LEDa, IRD, Université Paris-Dauphine, PSL Université); Roberta Teixeira (Universidade Federal do Rio de Janeiro (UFRJ)) |
| Abstract: | The Covid-19 pandemic caused the most recessive shock the Brazilian labour market has ever experienced in its history. In the second quarter of 2020, more than 11 million jobs had been lost compared to the pre-pandemic period. Paradoxically, informal employment has paid the heaviest price for the crisis with two thirds of jobs destroyed. While unemployment has increased significantly, the main mode of adjustment has been an unprecedented withdrawal from the labour market which results in an explosion of inactivity. Since then, there has been a progressive recovery. At the end of 2021, the shock seems to be absorbed, the main labour market indicators returning to their pre-pandemic levels. However, this macro picture based on net labour flows only partially reflects the micro dynamics at work. What happened to the workers who lost their jobs? Who are they? Has the pandemic changed the nature of professional mobility, or has it only accentuated previous structural transitions? This study aims at answering these questions by mobilizing data from the PNAD-Continua panel. After correcting the selective attrition in the samples due to the changes in survey collection modes during the pandemic, re-weighted transition matrices are elaborated by distinguishing five main employment statuses: occupied workers (formal and informal), unemployed, discouraged workers, other inactive. Econometric models are then estimated to draw profiles and to identify the main socio-demographic factors associated with these transitions. Estimates are carried out for the three sub-periods (prepandemic, shock and recovery), in order to disentangle what is specific to the Covid-19 crisis. The results highlight labour flows that are much more massive and complex than the macro approach suggests. Paradoxically, the overall rate of sectoral mobility remained constant during the shock, despite its magnitude. It even collapsed in the recovery phase. The increase in exits from the informal sector into inactivity has been offset by greater immobility of the unemployed, without disrupting either the structure of the transitions between statuses or their determinants. The exclusion from the labour market that has affected the most vulnerable underlines the importance of the category of discouraged workers, a neglected phenomenon which deserves special attention. Finally, we find that the pandemic has exacerbated the inequality dynamics, particularly those related to gender, already at work before the crisis. |
| Keywords: | Brazil, Covid-19,labour market, transition, panel data, inequalities |
| JEL: | J21 J46 J60 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:dia:wpaper:dt202202&r= |
| By: | Analia Schlosser; Yannay Shanan |
| Abstract: | The long-term unemployed sometimes lack basic soft skills needed to enter and succeed in the labor market. We examine whether it is possible to develop or enhance these skills among adults by using a large-scale randomized control trial (RCT) to evaluate the effectiveness of an Active Labor Market Program (ALMP) that targets income-support claimants in Israel. In this program, participants receive personalized treatment composed of weekly sessions with occupational trainers and motivational group workshops. We find that the program increased participants’ employment rate by 8 percentage points (a 24% increase) and decreased income support recipiency by 11 percentage points (a 26% decline) relative to the control group. The effects are larger among individuals with a lower attachment to the labor market and lower likelihood of employment such as high-school dropouts and those with a longer history of welfare dependence. Income from work increased both for treated individuals and for their untreated spouses suggesting that the program had positive spillovers within the household. There is no evidence of displacement effects on the control group. The analysis of the mechanisms at work shows that the program had positive and significant effects on participants’ soft skills, mainly among those with no recent employment spell, who gradually joined the labor market after participation in the program. In contrast, it induced individuals who had a recent employment spell to go back to employment soon after their allocation to the program. The program effects persist in the long run, even during the Covid-19 crisis, about five to six years after its implementation. We conclude that unemployed income-support claimants with no recent employment spells can benefit considerably from interventions that aim to improve their soft skills. |
| Keywords: | ALMP, noncognitive skills, soft skills, program evaluation |
| JEL: | J24 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9609&r= |
| By: | Paolo Martellini; Todd Schoellman; Jason A. Sockin |
| Abstract: | We measure college graduate quality — the average human capital of a college’s graduates—using the average earnings of the college’s graduates adjusted to a common labor market. Our implementation uses the database of the website Glassdoor, which has the necessary information on earnings and education for non-migrants and migrants who graduate from roughly 3,300 colleges in 66 countries. Graduates of colleges in the richest countries have 50 percent more human capital than graduates of colleges in the poorest countries. Migration reinforces these differences. Poorer countries do not just lose a higher share of their skilled workers; their emigrants are highly positively selected on human capital. Finally, we show that these stocks and flows matter for growth and development by showing that college graduate quality predicts the share of a college’s students who become inventors, engage in entrepreneurship, and become top executives, both within and across countries. |
| Keywords: | Human capital; Entrepreneurship; Migration; Development; Innovation; College quality |
| JEL: | J30 O11 O15 J60 |
| Date: | 2022–03–07 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmwp:93935&r= |
| By: | Alan S Duncan (Bankwest Curtin Economics Centre (BCEC), Curtin University) |
| Abstract: | This report, the ninth in the Bankwest Curtin Economics Centre’s Focus on the States series, provides the latest examination of the prevalence of poverty within Australia, how this has changed over time, and which groups in society face the greatest risks of financial hardship and material deprivation. The report looks at how income poverty has changed through the experiences of the COVID-19 pandemic and examines how Australia’s states and territories compare in the prevalence of poverty and disadvantage, and seek to understand more about people’s journeys into poverty, and the pathways and supports to escape from financial hardship. The measurement of income poverty in the report assesses the number of people whose incomes fall below a poverty line as a representation of a basic living standard. But much of this Focus on the States report looks ‘behind the line’, exploring deeper issues that highlight how poverty affects people’s livelihoods and life chances, and their sense of wellbeing. The report reveals the scarring effects of childhood poverty on life outcomes in adulthood, and shows the extent to which prolonged experiences of poverty affect mental health and exert psychological trauma. It also puts forward for consideration a range of policy recommendations that would go some way to alleviating and assisting people to escape the poverty trap. |
| Keywords: | poverty, disadvantage, gender equality, financial hardship, pathways into poverty, life events, poverty persistence, mental health, poverty trap, income support, rent assistance. |
| JEL: | I3 I14 I32 I38 J12 J15 J16 J31 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:ozl:bcecrs:fs09&r= |