Changes In Labor Market Outcomes Research Articles

Long-Term Effects of an Education Stipend Program on Domestic Violence: Evidence from Bangladesh

Abstract Intimate partner violence (IPV) remains a widespread global phenomenon. Among various factors, a low level of education is considered a significant risk factor for experiencing IPV. This paper evaluates whether a secondary school stipend program introduced in 1994 for rural girls affected the long-term prevalence of IPV in Bangladesh. The study exploits two sources of variation in the intensity of program exposure and geographic eligibility and finds that cohorts of rural women eligible for the program experienced significant declines in IPV. Evidence on mechanisms suggests that the program delayed marriage formation and changed partner quality, namely their education and employment, consistent with positive assortative matching resulting from women's improved educational attainment. There are no significant changes in labor market outcomes, decision making within the household, or women's attitude toward the acceptability of domestic violence. Marital matches present a plausible channel through which the program reduces the risk of IPV.

Mental Health Costs of Lockdowns: Evidence from Age-Specific Curfews in Turkey

Using a strict, age-specific lockdown order for adults aged 65 and older in Turkey, we examine the mental health consequences of an extended period of tight mobility restrictions on senior adults. Adopting a regression discontinuity design, we find that the curfew-induced decline in mobility substantially worsened mental health outcomes, including somatic and nonsomatic symptoms of mental distress (approximately 0.2 standard deviation). Exploring potential channels, we document an increase in social and physical isolation, with no evidence of robust changes in labor market outcomes or intrahousehold conflict for this subpopulation. (JEL D13, I21, I18, J14, O15)

Natural disasters and labor migration: Evidence from Nepal’s earthquake

The 2015 earthquake in Nepal affected approximately 8 million people, resulting in an economic loss of 10 billion US dollars. We exploit the quasi-random spatial and temporal nature of ground tremors to evaluate the impact of the 2015 earthquake on international labor migration per 100,000 population in Nepal. Using different sets of difference-in-differences research designs, we show that the number of work permits issued to Nepalese individuals for international migration decreased significantly in districts severely affected by the 2015 earthquake. Results further indicate that the effect of the earthquake on international labor migration is statistically significant and negative only among males. Together, these results provide strong evidence that natural disasters induce significant changes in labor market outcomes in a developing country setting.

Labour market conditions and adult health in Mexico

AbstractThis paper examines the role of local labour market conditions on self‐reported adult physical and mental health and health behaviours in Mexico. We construct measures of overall and gender‐specific predicted employment growth rates using a shift‐share approach that exploits exogenous variation in national industry‐specific growth rates and baseline industry employment shares across municipalities. Using detailed household‐level panel data and individual fixed effects, we find that increases in overall formal labour demand improve physical health of men but have no effect on the health of women. However, increases in gender‐specific formal labour demand improve the physical health of both men and women, with larger effects among men. We also find significant but small effects of male labour demand on the mental health of men. All effects are more pronounced for less educated people. Finally, we explore a range of potential mechanisms, finding that the effects might operate through changes in labour market outcomes, but we do not find evidence that the effects operate through changes in health behaviours.

The Effect of Education on Mortality and Health

This paper examines a schooling expansion in Romania which increased educational attainment for successive cohorts born between 1945 and 1950. We use a regression discontinuity design at the day level based on school entry cutoff dates to estimate impacts on mortality with 1994-2016 Vital Statistics data and self-reported health with 2011 Census data. We find that the schooling reform led to significant increases in years of schooling and changes in labor market outcomes but did not affect mortality or self-reported health. These estimates provide new evidence for the causal relationship between education and mortality outside of high-income countries and at lower margins of educational attainment.

International Trade and Labor Markets: Evidence from the Arab Republic of Egypt

Since the early 1990s, some developing countries have experienced a coincidence of rising exports – especially those related to global value chains – and improved labor market outcomes. During 2000–10, rising trade was associated with falling poverty and inequality in many developing countries. However, the Arab Republic of Egypt was not one of these countries, although it signed several trade agreements. The lack of trade-related improvements in labor market outcomes – including poverty, inequality, average wage levels, informality, and female labor force participation – could be explained by at least two possibilities. First, it is possible that trade agreements did not produce the same increase in trade for Egypt as for other countries. Second, it is possible that exports do not generate the same kinds of changes in labor market outcomes as experienced in other countries. After presenting the trends in key labor market outcomes over 2000–19, this paper evaluates both hypotheses. Using a gravity model approach, the results suggest that the changes in Egypt's exports following trade agreements are above internationally estimated averages. Second, the results from a Bartik approach find no significant relationship between rising exports and wages, informality, or female labor force participation. Additional analysis shows that Egypt's average wage levels are among the highest among countries that export the same goods exported by Egypt, possibly suggesting that Egypt has a relatively weak comparative advantage in currently exported goods, and thus might need to rethink its export basket.

Mental Health Costs of Lockdowns: Evidence from Age-Specific Curfews in Turkey

Using a strict, age-specific lockdown order for adults aged 65 and older in Turkey, we examine the mental health consequences of an extended period of tight mobility restrictions on senior adults. Adopting a regression discontinuity design, we find that the curfew-induced decline in mobility substantially worsened mental health outcomes, including somatic and nonsomatic symptoms of mental distress (approximately 0.2 standard deviation). Exploring potential channels, we document an increase in social and physical isolation, with no evidence of robust changes in labor market outcomes or intrahousehold conflict for this subpopulation.

How Workers Fared under the ACA.

Many politicians, policy makers, and analysts have debated whether the Affordable Care Act (ACA) would have negative effects on the labor market, such as reducing employment, earnings, or hours worked. Building on the existing literature, we investigated how workers' coverage changed under the ACA and whether coverage gains were associated with changes in labor market outcomes across occupations through 2017. We also examined whether occupations experiencing increased coverage through nonemployment sources (i.e., Medicaid or individual plans purchased on the ACA's Marketplaces) also experienced offsetting declines in employer-sponsored insurance (ESI) coverage. Finally, we investigated whether the employer mandate was associated with changes in ESI offers to workers. Among workers in occupations experiencing larger coverage gains under the ACA, we found no evidence that employment, hours worked, or earnings fell relative to workers in occupations that had little change in coverage rates over the same period. Moreover, ESI offers remained stable, even among workers in firms likely subject to the employer mandate. Overall, we found that predictions that the coverage provisions and mandates of the ACA would lead to adverse labor market effects did not materialize.

Changes in Early Labor Market Outcomes among Young College Graduates in South Korea

The unemployment rate among youths (age 20–29) in South Korea has increased sharply from 6.6 percent in 2002 to 9.8 percent in 2016. At the same time, the college entrance rate remains around 70 percent, and skill mismatch among college goers is a critical policy concern. Little attention has been paid to temporal change in labor market outcomes among college graduates or to the kinds of graduates who are particularly vulnerable to labor market uncertainty. We investigate how labor market experiences for college graduates have changed over time using data from nine different graduating cohorts of the Graduate Occupational Mobility Survey (GOMS). The results reveal that the proportion of those searching for a job has increased over time, and that even for those who were employed, job quality deteriorated. We also find a growing gap in labor market outcomes by reputation of graduating universities and college major.

Parental Employment Effects of Switching from Half-Day to Full-Day Kindergarten: Evidence from Ontario’s French Schools

Full-day kindergarten programs are expanding across North America, driven by a policy focus on early childhood development. These programs also affect parents’ budget sets and may lead to changes in labour market outcomes. We examine parents’ labour supply response to the move from half-day to full-day kindergarten in Ontario’s French schools well before the same change was made in English schools. We find no robust evidence of labour supply effects for fathers in two-parent families and only some limited and modest effects for mothers in two-parent families. For single mothers, the estimates suggest large and statistically significant effects on employment and hours of work, in particular for working longer hours.

Mental Health Costs of Lockdowns: Evidence from Age-Specific Curfews in Turkey

Using a strict, age-specific lockdown order for adults aged 65 and older in Turkey, we examine the mental health consequences of an extended period of tight mobility restrictions on senior adults. Adopting a regression discontinuity design, we find that the curfew-induced decline in mobility substantially worsened mental health outcomes, including somatic and nonsomatic symptoms of mental distress (ranging from 0.2 to 0.3 standard deviations). Exploring potential channels, we document an increase in social and physical isolation, with no evidence of robust changes in labor market outcomes or intrahousehold conflict for this subpopulation.

Parental Employment Effects of Switching from Half‐Day to Full‐Day Kindergarten: Evidence from Ontario's French Schools

Full-day kindergarten programs are expanding across North America, driven by a policy focus on early childhood development. These programs also affect parents' budget sets and may lead to changes in labour market outcomes. We exploit the unusual nature of Ontario's government school system to examine parents' labour supply response to a move from half-day to full-day kindergarten in Ontario's French – but not English – schools. We find no robust evidence of labour supply effects for fathers in two parent families, and only some limited and modest effects on mothers in two parent families. For single mothers, the point estimates suggest large and statistically significant effects on employment and hours of work, and in particular for working longer hours.

Trade-Induced Job Turnover and Unemployment: The Role of Variable Demand Elasticity

This paper develops an open economy dynamic general equilibrium model to quantify a new mechanism that substantially magnifies trade-induced changes in labor market outcomes. The model features matching frictions in the labor market and variable demand elasticities in product markets. Because openness increases demand elasticities in product markets, it makes firms' employment decisions more responsive to their idiosyncratic shocks. This in turn raises aggregate job turnover, unemployment, and residual wage inequality in steady state. Fitted to Colombian plant-level data, my model explains the rise in these labor market variables that accompanied Colombia's trade liberalization, while a restricted version of the model that imposes constant demand elasticities fails to do so.

Housing Booms, Manufacturing Decline and Labour Market Outcomes

We study the extent to which manufacturing decline and local housing booms contributed to changes in labor market outcomes during the 2000s, focusing primarily on the distributional consequences across geographical areas and demographic groups. Using a local labor markets design, we estimate that manufacturing decline significantly reduced employment between 2000 and 2006, while local housing booms increased employment by roughly the same magnitude. The effects of manufacturing decline persist through 2012, but we find no persistent employment effects of local housing booms, likely because housing booms were associated with subsequent busts of similar magnitude. These results suggest that housing booms “masked” negative employment growth that would have otherwise occurred earlier in the absence of the booms. This “masking” occurred both within and between cities and demographic groups. For example, manufacturing decline disproportionately affected older men without a college education, while the housing boom disproportionately affected younger men and women, as well as immigrants. Applying our local labor market estimates to the national labor market, we find that roughly 40 percent of the reduction in employment during the 2000s can be attributed to manufacturing decline and that these negative effects would have appeared in aggregate employment statistics earlier had it not been for the large, temporary increases in housing demand.

Did the Affordable Care Act Young Adult Provision Affect Labor Market Outcomes? Analysis Using Tax Data

Using a data set of US tax records spanning 2008 to 2013, the authors study the impact of the Affordable Care Act (ACA) young adult dependent coverage requirement on labor market–related outcomes, including measures of employment status, job characteristics, and postsecondary education. They find that the ACA provision did not result in substantial changes in labor market outcomes. Results show that employment and self-employment are not statistically significantly affected. Although some evidence supports the increased likelihood of young adults earning lower wages, not receiving fringe benefits, enrolling as full-time or graduate students, and young men being self-employed, the magnitudes imply extremely small impacts on these outcomes in absolute terms and when compared to other estimates in the literature. The authors find these results to be consistent with health insurance being less salient to young adults, compared to other populations, when making labor market decisions.

Sexual identity and the lesbian earnings differential in the U.S.

Two decades of research on wage differentials by sexual orientation uses data-sets that do not ask respondents about their own sexual orientation, even though sexual identity is key to theories that explain why a wage differential might exist. We show that many women who claim a lesbian identity for themselves are not classified as lesbian by researchers using the behavioral proxies typically available in the data. Conversely, many women who describe themselves as heterosexual are classified as lesbian because they report sexual experiences with women. Misclassification may lead to erroneous conclusions about changes in labor market outcomes. The results highlight the need to develop robust methods for collecting data on sexual identity and for more research on the interrelationship between sexual identity and behavior, especially occupational choice.

Legalization and human capital accumulation

This paper presents new evidence regarding the effects of legalization on the training of immigrants who were granted legal status through the US Immigration Reform and Control Act (IRCA) of 1986. Our findings point to a large increase in the immigrants’ incidence of training relative to comparable groups of natives following legalization. While training gains are higher for males, wage gains are higher for females. We also show that an important part of these changes in labor market outcomes occurs through occupation changes by newly legalized immigrants.

DEMOGRAPHIC TRANSITION AND LABOUR MARKET CHANGES: IMPLICATIONS FOR ECONOMIC DEVELOPMENT IN CHINA

AbstractChina has witnessed a rapid demographic transition in recent decades, which has driven changes in labour market outcomes as evidenced by labour shortages and increasing wages for unskilled workers. In this paper, the authors survey the literature on population transition, factors influencing fertility and how these have changed, and population policies in China. The fundamental role of demographic transition in labour market changes is also reviewed. In addition, the paper discusses the implications of demographic transition and labour market changes for economic development in China, including ageing, impacts on potential economic growth rates, and challenges to human capital accumulation.

Labor Market Outcomes and the Transition to Adulthood

According to Sheldon Danziger and David Ratner, changes in the labor market over the past thirty-five years, such as labor-saving technological changes, increased globalization, declining unionization, and the failure of the minimum wage to keep up with inflation, have made it more difficult for young adults to attain the economic stability and self-sufficiency that are important markers of the transition to adulthood. Young men with no more than a high school degree have difficulty earning enough to support a family. Even though young women have achieved gains in earnings, employment, and schooling relative to men in recent decades, those without a college degree also struggle to achieve economic stability and self-sufficiency. The authors begin by describing trends in labor market outcomes for young adults-median annual earnings, the extent of low-wage work, employment rates, job instability, and the returns to education. Then they examine how these outcomes may contribute to delays in other markers of the transition to adulthood-completing an education, establishing independent living arrangements, and marrying and having children. They conclude that adverse changes in labor market outcomes are related to those delays but have not been shown to be the primary cause. Danziger and Ratner next consider several public policy reforms that might improve the economic outlook for young adults. They recommend policies that would increase the returns to work, especially for less-educated workers. They propose raising the federal minimum wage and adjusting it annually to maintain its value relative to the median wage. Expanding the Earned Income Tax Credit for childless low-wage workers, the authors say, could also raise the take-home pay of many young adult workers, with minimal adverse employment effects. New policies should also provide work opportunities for young adults who cannot find steady employment either because of poor economic conditions or because of physical and mental disabilities or criminal records that make it hard for them to work steadily even when the economy is strong. Finally, the authors recommend increasing federal Pell grants for college and improving access to credit for would-be college students to raise the educational attainment of young adults from low-income families.

The Labor Market Effects of Welfare Reform

The recent reform of the federal welfare system was meant to encourage recipients to leave welfare and enter the workforce. If the reform is successful there are likely to be effects felt throughout the low--skilled end of the labor market. As former welfare recipients enter the labor market, they may exert downward pressure on wages or displace employment of others already in the labor market. Since there has been limited changes in eligibility for federal welfare programs from which to draw inferences, the magnitude of these labor market effects are uncertain. This study analyses an earlier welfare reform, the elimination of the General Assistance program in Michigan in October 1991, that may provide useful evidence on the effect of the 1996 Federal reform. General Assistance was a large--scale, state--administered program that provided benefits to people who fell through the cracks in federal anti--poverty programs. In all, about 82,000 able--bodied adults lost benefits. Comparisons with changes in labor market outcomes in other states suggest that the labor--market entry of former GA recipients in Michigan led to a 0.9 to 2.6 percentage point increase in employment among high school drop--outs and a 1.2 to 2.7 percent decline in weekly hours. There is little evidence of a systematic effect on hourly earnings among men; however, earnings among women may have fallen by as much as 5.8 percent.