Earnings Of Workers Research Articles

How the COVID-19 pandemic could reduce near-retirees' Social Security benefits

AbstractA quirk in the Social Security benefit formula interacting with the sharp economic downturn due to the COVID-19 pandemic could cause certain groups of near-retirees to suffer significant and permanent reductions to their Social Security retirement benefits. A sudden decline in the Social Security Administration (SSA)'s measure of economywide average wages in the year a worker turns 60 causes the Social Security benefit formula to devalue all the worker's earnings prior to age 60, resulting in a lower measure of career-average earnings and a lower benefit in retirement. A middle-income worker aged 60 in 2020 could receive an annual Social Security benefit reduction of around 9%, with losses through retirement approaching $46,000. Individuals becoming eligible for Social Security Disability Insurance benefits would be subject to similar reductions in percentage terms. Several methods are discussed to reduce or eliminate the likelihood of similar benefit ‘notches’ occurring in the future.

When Sport Event Work Stopped: Exposure of Sport Event Labor Precarity by the COVID-19 Pandemic

The COVID-19 pandemic of 2020 has exposed major weaknesses in economic, governmental, and social structures that many have taken for granted in everyday life. The sport industry, which has gained unprecedented popularity in recent decades, is no exception. Decisions, driven in response to the COVID-19 outbreak, to suspend play in major sports leagues across the globe have exposed the precarious nature of the work situation that hourly event workers find themselves in. As the games stopped, so did the earnings of workers who impact essential aspects of the sport spectators’ experience. These workers include the part-time front of house staff for public assembly facilities, including ushers, concessions workers, ticket takers, and security personnel. This essay, drawing on ideas from C.W. Mills, Arne Kalleberg, and Guy Standing, will examine the impact of the pandemic on the employment of these workers by looking at the state of labor associated with sport and sports events. Furthermore, the essay will explore the challenges facing a class of workers who depend on numerous part-time or seasonal sports event jobs to scrape together an existence when sport suddenly stops. Finally, the essay will address the potential aftereffects of the COVID-19 pandemic on sport labor and consider how sport work could change as a result. This scholarly commentary lays the groundwork for further study and analysis of an important, yet rarely remarked on, aspect of employment morality and sport labor studies.

Work adaptations insufficient to address growing heat risk for U.S. agricultural workers

The over one million agricultural workers in the United States (U.S.) are amongst the populations most vulnerable to the health impacts of extreme heat. Climate change will further increase this vulnerability. Here we estimate the magnitude and spatial patterns of the growing heat exposure and health risk faced by U.S. crop workers and assess the effect of workplace adaptations on mitigating that risk. We find that the average number of days spent working in unsafe conditions will double by mid-century, and, without mitigation, triple by the end of it. Increases in rest time and the availability of climate-controlled recovery areas can eliminate this risk but could affect farm productivity, farm worker earnings, and/or labor costs much more than alternative measures. Safeguarding the health and well-being of U.S. crop workers will therefore require systemic change beyond the worker and workplace level.

First-time mothers and the labor market effects of the earned income tax credit

Abstract The Earned Income Tax Credit (EITC) is one of the largest anti-poverty programs in the United States, providing over $67 billion to more than 27 million families for the tax year 2016, an average of $2,455. By subsidizing the earnings of low-income workers, the EITC reduces poverty both directly through the credit itself and indirectly through labor supply incentives. The two primary determinants of the amount a tax unit receives are earned income and number of children. Many studies define eligibility based on the presence of children in a household and separate analyses by marital status, a reflection of the fundamentally different incentives the EITC poses for single- and dual-earner households. However, as the EITC theoretically encourages fertility and generally discourages marriage, endogenous responses along these two dimensions could bias estimates which rely on them for identification and sample selection. In this paper, I revisit the classic question of the EITC’s labor market effects while exploiting a source of arguably exogenous variation in EITC receipt that does not rely on these potentially endogenous characteristics: birth timing around the end of the calendar year. Using the Survey of Income and Program Participation, my results show positive earnings and employment effects for unmarried women in the 12 months following their first/only child’s birth, including for those with a high school degree or less (low-ed). Overall, the results are usually small and insignificant for married women, with the exception of negative (and sometimes significant) effects on earnings for low-ed married women. Using a difference-in-discontinuities approach, I separate the income effect of the credit itself from the information effect, which, I argue, occurs when women receive the EITC for the first time. I show that, while the income effect is negative across all groups of women, the information effects are positive for unmarried women and negative for married women, again consistent with theory and the body of evidence on the EITC.

Who Do Unions Protect From Job Losses? A Cross-national Comparison

What members do unions protect? This question is relevant to an ongoing debate about union wage distribution. This paper investigates how unionization affects the relationship between involuntary job loss and a worker’s unobservable ability. Taking advantage of detailed micro-level panel data from four countries--Britain, Germany, Korea and Switzerland—I construct an index of workers’ unobservable abilities by estimating workers’ individual fixed effects. I find that unionization at the work place plays an important role. In Britain, Korea, and Switzerland, unions increase the earnings of lower ability workers but provide more job security to higher ability workers. The negative relationship between involuntary job loss and worker’s ability appears only in unionized workers. An exception is Germany, where lower ability workers in both unionized and non-unionized sectors are disproportionally more likely to lose jobs. The German case may associate with strong institutional forces at the industrial and national level.

Workplace-based opportunities to support child care workers' health and safety.

Child care workers earn among the lowest wages in the United States and they struggle with many health issues. The purpose of this study was to describe workplace supports for nutrition, physical activity, other health behaviors (e.g., smoking cessation, stress management), and occupational health and safety available to child care workers, and thereby inform the development of future workplace-based interventions to improve worker well-being. Between 2015 and 2016, 74 North Carolina child care centers (and directors), participating in a larger randomized controlled trial, completed a Workplace Health and Safety Assessment (interview and observation) measuring four domains: Infrastructure, Organizational Policies and Procedures, Programs and Promotions, and Internal Physical Environment. This study used baseline data to report means and standard deviations. Participating child care centers employed, on average, 12.7±8.4 employees. Total scores from the Workplace Health and Safety Assessment averaged 41.3±12.6 out of a possible 154, demonstrating many missed opportunities for supporting health/safety. More specifically, centers scored on average 9.5±3.9 on Infrastructure (35% of potential points), 11.1±3.9 on Organizational Policies and Procedures (32% of potential), 7.6±5.4 on Programs and Promotions (12% of potential), and 13.1±2.2 on Internal Physical Environment (49% of potential). The most frequent supports available were for occupational health and safety issues, while fewer supports were available for physical activity and other health behaviors. Child care workers could benefit greatly from more comprehensive workplace health and safety interventions; however, strategies must overcome centers' limited capacity and resources.

Health Information, Treatment, and Worker Productivity

Abstract Agricultural and other physically demanding sectors are important sources of growth in developing countries, but prevalent diseases such as malaria can adversely impact the productivity and labor supply of workers. We estimate the impact of malaria infection on worker earnings, labor supply, daily productivity, and task selection by using a phased-in design where we randomize the study week in which piece-rate workers at a large sugarcane plantation in Nigeria are offered malaria testing and treatment. Two estimation strategies indicate a significant and substantial intent to treat effect of the intervention. The program increases worker weekly earnings by 11%–13% over the weeks following the offer, depending on the reference period, estimated using a between-worker estimator that exploits the experimental design. A within-worker estimate provides similar but smaller estimates of 8%–10%. We identify different pathways through which this effect occurs. For workers who test positive for malaria, the treatment of illness principally increases labor supply, leading to higher earnings. For workers who test negative, the health information leads to increased earnings via augmented daily productivity. This productivity response arises, in part, from selection into higher return tasks within their job at the plantation. The results underline the importance of medical treatment but also of improved access to information about one's health status, as the absence of either leads workers to work less or choose lower return tasks when working.

COVID-19, the CARES Act, and Families' Financial Security

In response to the economic shock induced by the COVID-19 pandemic, Congress passed the $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act. Using household data on savings, income and expenses from the Survey of Consumer Finances, we show that cash assistance included in the CARES Act –namely, unemployment insurance benefit expansions and stimulus payments-- are instrumental in allowing almost all families to cover their recurring, non-discretionary expenses in the event of long-term unemployment. In the absence of such substantial government support, we document that nearly half of families who lose their income for six months would not be able to cover their expenses due to low levels of liquid savings and standard UI benefits that typically fall well below full replacement of income. Even though the increased UI payments expire after four months, because these benefits substantially exceed lost earnings for many workers, they have the potential to help households cover expenses well beyond four months by allowing otherwise paycheck-to-paycheck families to save.

FDI in hot labour markets: The implications of the war for talent

This paper highlights an inherent contradiction that exists within investment promotion activities in rich countries. Since the financial crisis, many inward investment agencies have shifted their activities from job creation per se to seeking to attract investment in high-tech activities. Such knowledge-intensive sectors are engaged in what has become referred to as “the war for talent”, so locations need to understand their value proposition to firms, especially where labour is tight. This paper explores the implications of this, in terms of the impact on employment and earnings of high skilled labour. We show that, because skill shortages already exist in many of these sectors, seeking to attract inward investment in these sectors simply causes the earnings of such workers to be bid up, and employment in the incumbent sector to fall. We highlight the over-riding importance that firms place on the availability of skilled labour when determining locations, and how policies which promote labour market flexibility, particularly through investment in skills to address skill shortages, can significantly mitigate the adverse effects, which tend to be more keenly felt in poorer regions of Europe where skilled labour is in even shorter supply.

ECONOMIC CONSEQUENCES OF COVID-19 AND THE CONCEPTS OF THEIR OVERCOMING

The main aim of this paper is to analyze the economic impact of COVID-19 pandemic on the global economy. Methods of summarization, formal logic and analytical methods were used in the research. The informational database is the official web-sites of the international organizations such as World Health Organization, International Labor Organization, and United Nations Development Program. In the paper the economic consequences of COVID-19 and the concepts of their overcoming are examined. The authors analyze the main problems , caused by COVID-pandemic worldwide, among which the following are determined: (1) decrease of employment level; (2) high risk of work closures by economic branches; (3) global working hours reduction by regions; (4) potential impacts of the pandemic on earnings of informal workers. The authors highlight that consequences of the current crisis are estimated 3-4 times more than the financial crisis of 2008. It was mentioned that the COVID-19 pandemic has a significant impact on the markets’ development by creating the great disproportion in the markets’ development. Also, in the paper the impacts of recommended and required workplace closures and the employment in countries with recommended or required workplace are presented. Impact of the COVID-19 crisis on enterprises (employers and own-account workers) in risky sectors by the economic sectors is given. The potential consequences are illustrated by the example of the economy of the G7 countries and EU. Annual output gap for EU countries was presented in the research. Three scenarios for the development of the COVID-19 pandemic were examined. They depend on termination of the economy’s lockdown. In the paper the necessity of the risk assessment scales and established crisis monitoring processes and systems have been proved. The example of the risk assessment scale, proposed by Schlumberger, was illustrated. Road map for the minimization of losses from COVID-19 was proposed by the authors, which takes into account the main problems identified by WHO as prerequisites. The COVID-19 crisis program, drawn up by authors, was presented in the paper.

COVID-19 Is Also a Reallocation Shock

Drawing on firm-level forecasts at a one-year horizon in the Survey of Business Uncertainty (SBU), we construct novel, forward-looking reallocation measures for jobs and sales. These measures rise sharply after February 2020, reaching rates in April that are 2.4 (3.9) times the pre-COVID average for jobs (sales). We also draw on special SBU questions to estimate that the COVID-19 shock caused 3 new hires for every 10 layoffs, that 32-42% of COVID-induced layoffs will be permanent, and that one-tenth of all work days (one-fifth for office workers) will shift from business premises to residences in the post-pandemic world relative to the pre-pandemic situation. Our survey evidence aligns well with anecdotal evidence of large pandemic-induced demand increases at many firms, evidence on job openings, gross job creation and gross business formation, and a sharp pandemic-induced rise in equity return dispersion across firms. After developing the evidence, we consider implications for the economic outlook and for policy responses to the pandemic. Unemployment benefit levels that exceed worker earnings, policies that subsidize employee retention, land-use restrictions, occupational licensing restrictions, and regulatory barriers to business formation will impede reallocation responses to the COVID-19 shock.

A case study on fair compensation to hand embroidery workers in India

PurposeThe study aims to focus on developing a methodology of technical calculation for fixation of piece rate for embroidery homeworkers of fashion industry to ensure an ethical livelihood standard. The standardised methodology for wage fixation will ensure better payments for homeworkers with clarity down the supply chain and sustainability of pay scales that will in turn improve the homeworkers’ impecunious living standards. The brands giving living wage will be benefitted in terms of savings on training costs, more stable work force, reliable services and enhancements to the reputation.Design/methodology/approachInterviews of subcontractors and agents down the supply chain in a target region were conducted to know current practice of wage fixation. The influential parameters were work content, basic living expenses and necessary benefits under government policies. Based on the aforementioned parameters, a formula has been generated. The present study is an attempt to develop a standard methodology to be used for piece rate calculation to ensure fair compensation for homeworkers. Impact of increased earnings of home workers on garment free on board cost has also been analysed.FindingsAs there is no uniformity in methodology used for piece rate calculation, and work content is not considered in calculating piece rate, the wage earned per month by homeworkers, minimum wage and living wage are INR 2,860, 6,998 and 8,007, respectively. Homeworkers receive 54-58 per cent of total embroidery labour cost incurred by suppliers. It can be increased up to 75 per cent, which would result in increasing the wage earned per month by homeworkers to INR 4,000.Originality/valueThe impact of implementing the outcome of the study will increase the earnings of embroidery homeworkers and reduce wage inequality in women’s favour, as there are more women than men in embroidery homeworking.

Associations Between Economic Factors and Condom Use Behavior Among Female Sex Workers in Dakar and Mbour, Senegal

Condom use remains a mainstay of HIV prevention programs around the world. However, data characterizing economic determinants of condom use among female sex workers (FSW) are limited, including in Senegal. We recruited 718 FSWs via respondent-driven sampling. Bivariate and multivariable regressions were conducted to assess the associations between economic variables and condom use at last sex. Paying rent (aRR: 1.07, 95%CI 1.01-1.13) was positively associated with condom use at last sex with new clients. No statistically significant associations were found between condom use and financial responsibility for dependent children, having additional source of income, sharing sex work earnings, or the ability to borrow from other FSWs, regardless of sexual partner types. The relationship between economic marginalization and consistent condom use among sex workers is complex reinforcing the need for behavioral economic research and prevention to be integrated into HIV prevention and treatment research and programs.

Nonprofit Wages: Theory and Evidence

The nonprofit sector’s share of wage and salary employment in the US has increased over time, from about 5.5 percent in the mid-1990s to 7 percent in 2015. This chapter surveys the literature and presents new evidence on the employment and earnings of workers in the nonprofit sector since 1994. As compared to the private for-profit sector, nonprofits have a more educated and older workforce, with employment concentrated in health, education, and service occupations and industries. Standard wage level analysis indicates lower wages for men employed in nonprofits compared with male for-profit workers with similar measured attributes. No such penalty is found for women. Based on panel estimates of wage changes, we find no substantive wage penalties for either women or men moving between jobs in and outside the nonprofit sector. We conclude that wages in the nonprofit and for-profit sectors, on average, differ little for similar workers and jobs.

Earnings Differences among Senior University Administrators: Evidence by Gender and Academic Field

This study examines earnings inequality by gender and academic field among senior university administrators, including presidents, vice presidents, associate and assistant vice presidents, and deans, using data from the Canadian province of Ontario. While a 4.4 percent earnings gap between male and female administrators is initially identified, much of the gap is explained by earnings inequality across academic fields and by the career experience of the administrators. Administrators who specialize in professional fields such as engineering, health sciences, law, and social work earn between 12 percent and 33 percent more than administrators who specialize in liberal fields in the humanities and social sciences.

Environmental Regulation and Worker Benefits: Evidence from City-Level Air Quality Standards in China

This study identifies the effect of environmental regulation on worker earnings using China’s “City Air Pollution Prevention and Control Program” (CAPPCP), which is a new city-level air quality, as a quasi-experiment. CAPPCP provides variations in regulatory intensity across years and cities for polluting firms, we use a difference-in-differences (DD) strategy to examine this variation and to compare the earnings in polluting firms before and after the program’s implementation. We match two unique firm-level datasets that include information on firm’s economic indicators, various emissions and abatement equipment. CAPPCP did not significantly decrease firm employment but caused an average of 3% reduction in worker earnings, which amounts to CNY 6.63 billion (USD 871.99 million) in forgone earnings. The estimated result is less than that of comparable US studies. In addition, the reduction in earning tends to be attributed at bonuses rather than regular wages, and firms pay more unemployment insurance for employees. In the channel test, CAPPCP led to an increase of 5.9% in firm’s pollution abatement equipment and 6.3% in pollution treatment capacity, which significantly increased firm’s production costs. We also find different types of firm responses to the regulations, where high-polluting, smaller, labor-intensive, low-tech, non-SOE, non-exporting firms and firms without labor union show a higher reduction in worker earnings than their counterparts. A cost-benefit analysis suggests that the health benefits gained through CAPPCP significantly outweigh that of earning losses.

The Economic Impact of Migrants from Hurricane Maria

Using a synthetic control estimation strategy we examine the economic impact of a large inflow of people from Puerto Rico into Orlando in the aftermath of Hurricane Maria, which devastated Puerto Rico in September 2017. We find that aggregate employment in Orlando increased as a result of the inflow, as did employment in the construction and retail sectors. We also find positive overall employment effects on non-Hispanic and less-educated workers, as well as positive effects on compensation for those same subgroups in the retail sector.In the construction sector – which absorbed the preponderance of this migrant labor supply shock – we find that earnings for non-Hispanic and less-educated (workers likely to be natives) decreased by a modest amount. These results together suggest that, while migrant inflows may have small negative impacts on the earnings of likely-native workers in sectors directly exposed to the labor supply shock, employment and earnings of likely-native workers in other sectors are positively impacted, possibly by increased local demand.

Nature of Work and Distribution of Risk: Evidence from Occupational Sorting, Skills, and Tasks

How does the nature of work—teleworkability and contact intensity—shape the distribution of health, earnings, and unemployment risks, created by the COVID-19 pandemic? To answer this question, I consider two contexts. First, I show that the existing patterns of spousal occupational sorting in the United States matter for the distribution of these risks. In particular, I show that sorting into occupations with similar contact intensity in the workplace mitigates the risk of intra-household contagion relative to the situation where spouses match at random in terms of occupations (zero sorting). Furthermore, I show that sorting into occupations with similar teleworkability exacerbates the exposure to earnings and unemployment risks relative to the case of zero sorting. Second, I document that teleworkable occupations more likely require higher education and experience levels as well as greater cognitive, social, character, and computer skills, compared to non-teleworkable occupations. This difference in skill requirements affects earnings and unemployment risks by increasing the likelihood of skill mismatch for the newly unemployed. My results imply that the current economic downturn may have long-run effects on employment prospects and earnings of workers who had non-teleworkable or high-contact-intensity jobs at the onset of the COVID-19 outbreak. I discuss the relevant policy implications and associated policy constraints that follow from my findings.

Tax evasion, market adjustments, and income distribution

How does tax evasion affect the distribution of income? In the standard analysis of tax evasion, all the benefits are assumed to accrue to tax evaders. However, tax evasion has other impacts that determine its true effects. As factors of production move from tax-compliant to tax-evading (informal) sectors, these market adjustments generate changes in relative prices of products and factors, thereby affecting what consumers pay and what workers earn. As a result, at least some of the gains from evasion are shifted to consumers of goods produced by tax evaders, and at least some of the returns to tax evaders are competed away via lower wages.

The Heterogeneous Effects of Trade across Occupations: A Test of the Stolper-Samuelson Theorem

This paper develops and implements a novel test of the Stolper-Samuelson theorem. We use nationally-representative matched employer-employee panel data from 1997 through 2015 to study the effect of the rise in China’s exports on French worker earnings. Our version of the Stolper-Samuelson theorem states that there is a negative correlation between occupation exposure to Chinese competition and change in worker earnings. First, we document substantial heterogeneity in trade adjustment across occupations. Then, consistent with the Stolper-Samuelson prediction, we show that workers initially employed in occupations more intensively used in hard-hit industries experience larger declines in earnings. We also show that workers tend to move out of hard-hit industries, but they tend to remain in their initial occupation.