Gender, Ethnicity, and Labor Force Instability

Abstract

We analyze the 1986 and 1987 Panels of the Survey of Income and Program Participation (SIPP) to examine the extent and magnitude of employment instability among black, Hispanic, and white men and women to address two questions about the character and correlates of labor force instability. First, what is the frequency of employment transitions during an annual observation period and how are transitions distributed among race, ethnic, and gender groups? Second, what are the social and demographic correlates of labor force instability? SIPP permits greater precision in the measurement of labor force dynamics because transitions among employment states are recorded on a weekly basis. Consistent with several recent studies, our results show that labor force instability is more prevalent than previously believed, that it is higher among women than among men, and that it is higher among black and Hispanic workers than among non-Hispanic whites. Because the distribution of labor force transitions is characterized by “overdispersion,” we use a negative binomial model to evaluate the correlates of instability. These results confirm the existence of race and ethnic differences in levels of instability depending on whether respondents ever visited employment during the observation period or transited among jobless states (employment and unemployment). The conclusion discusses implications for the study of labor market inequality.