Hourly Earnings Research Articles

Why Do Part-Time Workers Earn Less? The Role of Worker and Job Skills

Part-time workers receive considerably lower hourly earnings than do full-time workers. Using Current Population Survey earnings files for September 1995 through December 2002, the author finds that measurable worker and job characteristics, including occupational skill requirements, account for much of the part-time penalty. Longitudinal analysis of the data indicates that much of the remaining gap reflects worker heterogeneity, evidenced by small wage gains and losses among workers switching between part-time and full-time jobs. The lower skills of part-time than full-time workers result primarily from limited work experience and accumulation of human capital. Little evidence can be found of a large wage gap between part-time and full-time women. A part-time wage penalty is found for men, but men account for less than one-third of total part-time employment.

The economic burden of home care for children with HIV and other chronic illnesses.

We compared types, amounts, and costs of home care for children with HIV and chronic illnesses, controlling for the basic care needs of healthy children to determine the economic burden of caring for and home care of chronically ill children. Caregivers of 97 HIV-positive children, 101 children with a chronic illness, and 102 healthy children were surveyed regarding amounts of paid and unpaid care provided. Caregiving value was determined according to national hourly earnings and a market replacement method. Chronically ill children required significantly more care time than HIV-positive children (7.8 vs 3.9 hours per day). Paid care accounted for 8% to 16% of care time. Annual costs were $9300 per HIV-positive child and $25,900 per chronically ill child. Estimated national annual costs are $86.5 million for HIV-positive children and $155 to $279 billion for chronically ill children. Informal caregiving represents a substantial economic value to society. The total care burden among chronically ill children is higher than that among children with HIV.

Housework and the Wages of Young, Middle-Aged, and Older Workers

I. INTRODUCTION If childcare and other housework demand relatively large quantities of as compared to leisure and other non-market uses of time by men, women with responsibilities for housework would have less energy available for the market than men would. This would reduce the hourly earnings of married women, affect their jobs and occupations, and even lower their investment in market human capital when they work the same number of market hours as married men. Consequently, the housework responsibilities of married women may be the source of much of the difference in earnings and in job segregation between men and women. --Gary S. Becker (1985, p. S35) Consistent with Becker's hypothesis, employed women spend more hours on housework per week than do employed men on average. The magnitude of this gender gap in housework time is large, despite a reallocation of some housework activities from wives to husbands in recent years. Over the past 30 years, women's time spent in housework declined from four to three times that of men (Blau et al., 2002, p. 56). Because child care and housework continue to be primarily a woman's responsibility, many researchers have examined the extent to which the gender gap in housework time contributes to the gender wage gap. In general, these studies report that time spent on housework results in wage penalties, especially for married women, and including it in a wage regression increases the explained portion of the gender wage gap. What has not been examined is the effect of housework time on wages over the life cycle. Many aspects of housework are likely to vary over the life cycle, if for no other reason than individuals' fertility decisions are a function of age. It seems reasonable to assume that the total amount of housework required to maintain a family would depend on the size of the family and the ages of its members. As a young couple starts their family, the amount of housework necessary to take care of its members will increase. Conversely, as children age and leave the home, the total amount of required housework should decline. Additional housework responsibilities could arise from other sources, such as homeownership, which may be associated with specific stages of the life cycle. As the size of the family, the age of the children, and the probability of homeownership change over the life cycle, so, too, will the required amount of housework. The timing of housework tasks also may change over the life cycle. Some household chores must be performed continuously during the week, for example, meal preparation; whereas others can wait until the weekend, for example, yard work. Individuals who can postpone their housework tasks to nonwork days may not face the same energy constraint as their counterparts who are required to perform housework on workdays. Housework time may have differential wage effects, for the same number of hours per week, for individuals who perform it continually throughout the week versus those who regard it as primarily a weekend activity. There may be less flexibility in the timing of housework if children, especially young children, reside in the home. For this reason, there may be life-cycle effects associated with the timing of housework as well. There is also the possibility that the intensity of effort associated with an hour of housework time changes over the life cycle. The effort intensity associated with housework is likely to be a function of the type of housework performed. Some chores call for more effort than do others, for example, emptying the dishwasher versus cooking the meal; paying the bills versus mowing the lawn, and so on. Furthermore, the effort associated with typical housework tasks (meal preparation, cleaning, etc.) may be more intensive when combined with the presence of young children. As the nest starts to empty, the effort associated with certain types of housework is likely to decrease. …

The labor market consequences of experience in self-employment

Many public policies are designed to encourage self-employment. However, because self-employment experiences are typically brief, it becomes important to understand the long-term consequences of entering and then leaving self-employment. Using the Panel Study of Income Dynamics (PSID), we examine the effects of brief self-employment experience on subsequent labor market outcomes. We find that, relative to continued wage employment, brief spells in self-employment do not increase—and probably actually reduce—average hourly earnings upon return to wage employment. We also find that those who experience self-employment have difficulty returning to the wage sector. However, these consequences are small compared to similar experiences in unemployment.

The Socioeconomic Attainment Patterns of Africans in the United States

Using data from the public use microdata sample of the 1990 U.S. census, we examine the socioeconomic attainment patterns of Africans in the United States, within the context of the assimilation and selectivity perspectives. Three primary findings emerge from this study. First, we find that white African men and men from English-speaking Africa have higher net hourly earnings than their nonwhite and non-English-speaking counterparts. Second, we find that while South African men have higher net hourly earnings than men from a number of selected African countries, there is no statistically significant difference between the net hourly earnings of South African women and women from these selected African countries. Third, we find no statistically significant difference between the net hourly earnings of black African and black American men and women.

Overtime Working, The Phillips Curve And The Wage Curve: British Engineering, 1926–66

This paper shows that wage–unemployment elasticities derived from estimated wage curves and Phillips curves may be critically dependent on the measurement of wages. Incorporating hourly wage earnings that include the influence of overtime payments can lead to seriously distorted results. Meaningful elasticities are obtained only if hourly standard wages form the basis of analysis. Work is based on a unique data set describing two homogeneous blue–collar occupational groups—skilled fitters and unskilled labourers—in the British engineering industry. Each group is also divided into timeworkers and piece–rate workers. Data are aggregated into a panel of 28 local labour markets and cover the highly contrasting periods 1928–38 and 1954–66.

Post-College Schooling, Overeducation, and Hourly Earnings in the United States

Using 1990 US census data, the present paper examines the relationship between overeducation and earnings. The paper updates previous findings and then focuses on those most likely to be overeducated--individuals with post-college schooling. It is hypothesized that specific occupations that require college education may be flexible in their ability to utilize the surplus human capital of the employees. Being overeducated is shown to increase the wages of men working at a job that requires a bachelor's degree. The results are compared with findings in Canada and the UK. Additionally, overeducation is shown to contribute to the gender wage gap.

Growing Apart: THE "NEW ECONOMY" AND JOB POLARIZATION IN CALIFORNIA, 1992-2000

Author(s): Milkman, Ruth; Dwyer, Rachel E. | Abstract: This chapter explores the characteristics of job growth in California during the long economic expansion of the 1990s. The main focus is on the quality of (measured by median hourly earnings) generated during the boom years. Drawing on U.S. Current Population Survey data, the analysis shows that net employment growth in California was polarized between good jobs and bad jobs, with relatively little growth in the middle. The state's pattern of job growth was more polarized than that in the U.S. as a whole, although in both the state and the nation, the 1990s pattern contrasts sharply with that of the 1960s, when economic expansion generated a more evenly distributed array of jobs. In the 1990s, race, ethnicity and nativity were tightly linked to the polarization, although in the case of gender, the analysis reveals extensive within-group polarization. One of the most striking findings in this chapter involves regional differences: whereas the Los Angeles metropolitan area showed an even more extreme pattern of job polarization than the state as a whole, in the San Francisco Bay Area (which includes Silicon Valley) good jobs dominated growth, with little expansion of at the low end or in the middle. This suggests that the much-touted new economy of the 1990s is a geographically bounded phenomenon, and one that may depend on a more polarized and less salutary set of economic arrangements in nearby regions.

COMMUNITY COLLEGE ENROLLMENT AS A FUNCTION OF ECONOMIC INDICATORS

This study investigated the ability of national economic trends to predict enrollment in community colleges. Data from government documents and source books were used in a correlational analysis to explore the relationship between the national economy and enrollment in community colleges. The results indicated that Unemployment Rate, Gross Domestic Product, Dollars Disposable Income, and Personal Consumption Expenditures are good indicators of trends in community college enrollment. The Consumer Price Index and the Average Hourly Earnings of Production Workers were not significantly correlated to Total Enrollment or to Per Capita Community College Enrollment.

Is Leisure Time Worth More Than Working Time?

Abstract No abstract available.

Work experience and the gender earnings gap

Although the gender wage gap has narrowed somewhat during the past two decades, concerns are often expressed about its size and persistence. This paper explores the components of the gap in 1997–98, giving particular attention to the contribution of male‐female differences in past paid work experience. Two new methods are used to impute measures of women's work experience within HES and NZIS employee samples. Results from wage gap decompositions suggest that between one‐quarter and two thirds of the gender gap in average hourly earnings is due to male‐female differences in educational level and work experience. Between 40 and 80 percent of the gap can be accounted for when information on occupation and industry of employment is also included.

The Influence of Qualifications on Women's Work Histories, Employment Status and Earnings at Age 33

This paper examines the relationship between women's qualifications and their labour‐market participation up to the age of 33 for a cohort of women born in Great Britain in one week of march 1958. The period of the life‐cycle on which the analysis focuses is one during which many women are attempting to juggle the competing demands of young children and employment. In Britain, with very limited institutional support for retaining employment during family formation, we examine the role which occupationally specific qualifications exert in helping women to return to paid employment. The second part of the paper focuses on the occupational attainment of women at age 33, operationalized using log hourly earnings. The earnings equations are corrected for possible selectivity bias into employment. The paper makes an important theoretical distinction between occupationally specific and non‐occupational qualifications. We argue that, for women, occupational qualifications are associated with greater attachment to the labour‐market following the birth of children. By including work history variables in the earnings equation we ate also able to examine the consequences for women's wages of having time out of the labour market.

How Much Do Teachers Earn?

In the continuing debate over how to improve education systems, many people argue that teachers' salaries need to be increased. Nevertheless, there is very little reliable information on how much teachers actually earn, how well they fare relative to the labor market and the general distribution of income, and how the pay structure affects the recruitment, retention and motivation of teachers. This paper seeks to establish a reliable method for analyzing how much teachers earn using standard and accepted methods of labor market analysis, and applying them to the case of Bolivia. We break the question of How much do teachers earn? into three distinct parts. The first part shows that teachers' monthly incomes are less on average than the rest of the labor market, but that their hourly earnings are higher. An econometric analysis of household survey data shows that, after controlling for personal characteristics, teachers hourly earnings are still higher than they would earn in the private sector, but lower than they would earn in other unionized public sector jobs. Non-salary benefits are shown to provide teachers with further advantages over the private sector labor market. Next, we show that teachers are relatively well off in the overall distribution of income after incorporating other sources of income and life choices (i.e., second jobs, hours worked, second wage earners). We demonstrate that teachers are not apparently forced to take second jobs since they are less likely than other workers to take second jobs, and when they do, the hourly earnings in those jobs is higher than their teaching jobs. The final section of the paper discusses the implications of these findings for policies to improve recruitment, retention, and motivation of high quality teachers.

Immigration Reform and the Earnings of Latino Workers: Do Employer Sanctions Cause Discrimination?

This paper investigates whether employer sanctions for hiring undocumented workers introduced by the 1986 Immigration Reform and Control Act (IRCA) adversely affected the hourly earnings of Latino workers in the southwestern U.S. We exploit the staggering of the sanctions and employee verification requirements across sectors to estimate this effect. In particular, IRCA's employer-sanctions provisions were not extended to agricultural employers until two years after their imposition on non-agricultural employers. Hence, Latino agricultural workers provide a control group against which to compare changes in the wages of Latinos in non-agricultural employment. We find substantial pre-post IRCA declines in the hourly earnings of Latino non-agricultural workers relative to Latinos in agriculture. This pattern, however, is considerably stronger for Latino men than Latina women. We do not observe similar inter-sectoral shifts in relative wages among non-Latino white workers. In fact, the relative wage changes for non-Latino white workers are of the opposite sign. Finally, the pre-post IRCA relative decline in Latino non-agricultural wages reverses the pre-IRCA trend, where we observe the relative earnings of Latino non-agricultural workers increasing

Immigration Reform and the Earnings of Latino Workers: Do Employer Sanctions Cause Discrimination?

Using the Current Population Surveys, the authors investigate whether sanctions against employers for hiring undocumented workers, a provision of the 1986 Immigration Reform and Control Act (IRCA), adversely affected the hourly earnings of Latino workers in the southwestern United States. The analysis exploits the fact that agricultural employers were exempt from the sanctions and from employee-verification requirements for the first two years following IRCA's passage. The authors find substantial pre-post IRCA declines in the wages of Latino non-agricultural workers relative to Latinos in agriculture. They do not observe similar shifts in the relative wages among non-Latino white workers. When using non-Latino black and white non-agricultural workers as alternative control groups, they find that Latino wages declined relative to black wages but not relative to white wages. Finally, they find that the pre-post IRCA inter-sectoral and inter-ethnic relative wage declines for Latino non-agricultural workers do not reflect longerterm trends.

How Reliable are Register Data for Studies of the Return on Schooling? An examination of Swedish data

Some important studies have recently used Statistics Sweden's register data on educational levels and annual earnings to estimate the economic return on schooling. This is a powerful way of getting large samples and of adding information to data sets with other useful information. By using detailed information in the Level of Living Surveys, we investigate two potential flaws with this approach. First, the register data on education do not pick up some partial studies at high school and college which do not lead to formal degrees. Our results show that such studies have a significant positive economic return. Nonetheless, the use of this information as independent variables in regression models does not change the original estimates. So omission of partial studies does not flaw the results based on registers only. Second, also using the Level of Living Surveys, we compare estimates based on annual earnings as the outcome measure with those using hourly earnings. We find a marked difference, particularly for higher education levels. However, by eliminating observations with low earnings one gets results for annual earnings that are similar to those for hourly earnings.

The civilian labor market experiences of Vietnam-era veterans: the influence of psychiatric disorders.

BACKGROUND: Most research on the civilian labor market experiences of veterans has focused on the extent to which the skills and experience acquired in the military are rewarded in the civilian employment sector. While studies have been mindful of the need to analyze this question in a multivariate framework, controlling for other factors that might independently affect labor market outcomes, they have met this goal with limited success. As a result, an important element of the employment and wage determination process - psychiatric health - has been absent from this literature. AIMS OF THE STUDY: Using a nationally representative survey of Vietnam-era veterans, this study analyzes the contribution of psychiatric health toward explaining differences in the post-service civilian wages, hours worked, and employment probabilities among male veterans. METHODS: The analysis is based on data from the National Survey of the Vietnam Generation, a survey, completed in the late 1980s, of persons who were on active duty during the years of the Vietnam War, 1964-1975. Three outcome variables are studied - the hourly wage rate, usual hours worked per week, and a 0-1 indicator for whether the respondent is currently working. Lifetime diagnoses of four categories of mental disorders - major depression, anxiety disorders, substance abuse/dependence, and combat-related posttraumatic stress disorder (PTSD) - were constructed from the US NIMH Diagnostic Interview Schedule, administered by the survey. The employment probability equation was estimated using probit; the hourly earnings and hours worked equations via ordinary least squares conditioned on being employed. RESULTS: The study finds that PTSD significantly lowered the likelihood of working and, for those veterans who were working, their hourly wages. On average, a veteran with a lifetime diagnosis of PTSD was 8.5 percentage points less likely to be currently working than was a veteran who did not meet diagnostic criteria. Among those who were employed, veterans with PTSD earned, on average, $2.38 less per hour ($3.61 in 1999 U.S. dollars). Anxiety disorders and major depression had nearly as large an effect on employment rates, as did PTSD. Major depression was also found to have lowered hourly wages by an average of $6.77 per hour ($10.17 in 1999 US dollars). However, psychiatric health did not affect typical hours worked per week. DISCUSSION: This study contributes new information to several literatures. Previous research on the extent to which PTSD interferes with readjustment to civilian life has focused on quality-of-life outcomes such as overall well-being, physical health, and homelessness. Previous research on mental health and earnings has focused on annual earnings. This study makes hourly wage comparisons, a closer measure of productivity differences since they represent differences in pay for the same input of time. Finally, this study demonstrates that the effects of psychiatric health are as important as the influence of non-health characteristics that are thought to signal earnings potential in the civilian labor market (education and experience). These findings, however, may not apply generally. The importance of PTSD may be specific to veterans of the Vietnam War and may not pertain to persons suffering non-combat-related PTSD. IMPLICATIONS FOR HEALTH CARE PROVISION AND USE AND HEALTH POLICY FORMULATION: The magnitude of our estimates implies potentially large benefits from developing effective treatments for PTSD and from insuring access to these treatments. IMPLICATIONS FOR FURTHER RESEARCH: Future research should examine the relationship between work and PTSD in the general population and should explore the indirect effects of mental health, such as its effects on the post-service educational attainment and occupational choices of veterans.

Public Sector Employment, Wage Inequality and the Gender Pay Ratio in the UK

This paper assesses the relative contributions of the different systems of pay determination in the private sector and the public sector toward the changing level of wage inequality and the gender pay ratio in the UK. The greater centralisation of pay arrangements in the public sector compared with the private sector in the UK suggests that public sector employment may have acted to offset the widening wage inequality seen in recent years, as well as making an important contribution to the increase in women's relative average earnings compared to men. This issue is addressed by drawing on unpublished occupational hourly earnings data from the New Earnings Survey and applying decomposition of the Theil index of wage inequality to analyse both static and dynamic trends. The change in wage inequality for the period 1986 to 1995 primarily reflected the change in wage dispersion within the private sector, and the narrowing of the gender pay gap among the public sector workforce was an important factor in explaining the overall improvement in women's relative earnings. The paper argues that the relatively centralised pay arrangements in the public sector, compared with the private sector, played an important role in slowing the increase in wage inequality and narrowing the gender pay gap. As such, future policies to decentralise pay determination in the UK public sector may exacerbate the increasing level of wage inequality and reverse women's recent relative pay improvements.

HMO penetration and physicians' earnings.

The goal of this study is to estimate whether cross-sectional variations in enrollment in health maintenance organizations (HMOs) affected physicians' earnings and hourly income in 1990. Using data from a nationally representative sample of 4,577 younger physicians (<45 years) conducted in 1991, we estimated a partial reduced-form model of physicians annual income and per hour income. We tested whether HMO penetration is endogenous and used the instrumental variables approach to obtain unbiased estimates. HMO penetration had a negative and statistically significant impact on physicians earnings in 1990. A doubling of the average level of HMO penetration in the market is estimated to reduce annual earnings by 7% to 10.7%, and hourly earnings by approximately 6% to 9%. It appears that HMOs were successful in reducing physicians' annual and per hour earnings in 1990, presumably through a combination of fewer visits and lower payment rates for people covered by HMOs. Although these results cannot be generalized to all physicians, the experience of a younger cohort of physicians may still be a good indicator of the future effects of HMOs because younger physicians may be more susceptible to market forces than older and more established physicians. Moreover, these results may be somewhat conservative because they reflect market behavior in 1990, several years before the rapid growth and more aggressive market behavior of HMOs in recent years.

Immigration Reform and the Earnings of Latino Workers: Do Employer Sanctions Cause Discrimination?

This paper investigates whether employer sanctions for hiring undocumented workers introduced by the 1986 Immigration Reform and Control Act (IRCA) adversely affected the hourly earnings of Latino workers in the southwestern U.S. We exploit the staggering of the sanctions and employee verification requirements across sectors to estimate this effect. In particular, IRCA's employer-sanctions provisions were not extended to agricultural employers until two years after their imposition on non-agricultural employers. Hence, Latino agricultural workers provide a control group against which to compare changes in the wages of Latinos in non-agricultural employment. We find substantial pre-post IRCA declines in the hourly earnings of Latino non-agricultural workers relative to Latinos in agriculture. This pattern, however, is considerably stronger for Latino men than Latina women. We do not observe similar inter-sectoral shifts in relative wages among non-Latino white workers. In fact, the relative wage changes for non-Latino white workers are of the opposite sign. Finally, the pre-post IRCA relative decline in Latino non-agricultural wages reverses the pre-IRCA trend, where we observe the relative earnings of Latino non-agricultural workers increasing.