Competitive Labor Market Research Articles

International Labor Market Competition and Spousal Labor Supply Responses

We study how the 2004 EU enlargement to Eastern European countries has affected employment, earnings and the sharing of home production among workers employed in the Building and Construction industry, and their wives. We use license requirements to divide workers into two groups who are more and less exposed to labor market competition. We find that non-licensed workers experience a fall in labor earnings relative to licensed workers after the EU enlargement. Increased wife's labor supply and earnings compensate almost 40 percent of the loss. We do not find a similar change in the division of labor in home production.

Risk Managers in Banks

How do banks remunerate risk managers and what are the implications for risk-taking? Studying 127 German banks during the years 2003 to 2007, we show that risk managers' remuneration is positively aligned with performance-linked pay in front offices (FOs). When bonuses in FOs increase by one Euro, the bonus of a risk manager increases by 13.6 to 33.5 Cents, depending on the risk manager’s seniority. Risk-sharing among employees or labor market competition do not explain this finding. Banks with more aligned incentive pay between risk management and FOs during the years before the crisis of 2008-2009 performed better in the crisis.

Imperfect Competition and Rents in Labor and Product Markets: The Case of the Construction Industry

We quantify the importance of imperfect competition in the US construction industry by estimating the size of rents earned by American firms and workers. To obtain a comprehensive measure of the total rents and to understand its sources, we take into account that rents may arise due to markdown of wages in the labor market, or markup of prices in the product market, or both. Our analyses combine the universe of US business and worker tax records with newly collected records from US procurement auctions. We use this data to identify and estimate a model where construction firms compete with one another for projects in the product market and for workers in the labor market. The firms may participate both in the private market and in government projects procured through auctions. We find evidence of considerable wage- and price-setting power. This imperfect competition creates sizable rents, three-fourths of which is captured by the firms. The incentives of firms to mark down wages and reduce employment due to wage-setting power are attenuated by their price-setting power in the product market.

Imperfect Competition and Rents in Labor and Product Markets: The Case of the Construction Industry

The primary goal of our paper is to quantify the importance of imperfect competition in the U.S. construction industry by estimating the size of rents earned by American firms and workers. To obtain a comprehensive measure of the total rents and to understand its sources, we take into account that rents may arise both due to markdown of wages and markup of prices. Our analyses combine the universe of U.S. business and worker tax records with newly collected records from U.S. procurement auctions. We first examine how firms respond to a plausibly exogenous shift in product demand through a difference-in-differences design that compares first-time procurement auction winners to the firms that lose, both before and after the auction. Motivated and guided by these estimates, we next develop, identify, and estimate a model where construction firms compete with one another for projects in the product market and for workers in the labor market. The firms may participate both in the private market and in government projects, the latter of which are procured through first-price sealed-bid auctions. We find that American construction firms have significant wage- and price-setting power. This imperfect competition generates a considerable amount of rents, two-thirds of which is captured by the firms. Lastly, we use the estimated model to perform counterfactual analyses which reveal how increases in the market power of firms, in the product market or the labor market, would affect the outcomes and behavior of workers and firms in the construction industry. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

Measuring Employer-to-Employer Reallocation

We revisit measurement of Employer-to-Employer (EE) transitions, the main engine of labor market competition and employment reallocation, in the monthly Current Population Survey (CPS). We follow Fallick and Fleischman (2004) and exploit a key survey question introduced with the 1994 CPS redesign. We detect a sudden and sharp increase in the incidence of missing answers to this question starting in 2007, when the U.S. Census Bureau introduced a change in survey methodology, the Respondent Identification Policy (RIP). We show evidence of selection into answering the EE question by both observable and unobservable worker characteristics that correlate with EE mobility. We propose a selection model and a procedure to impute missing answers to the key survey question, thus EE transitions, after the introduction of the RIP. Our imputed EE aggregate series restores a close congruence with the business cycle, especially with the onset of the Great Recession, exhibits a much less dramatic drop in 2008-2009 and a full recovery by 2016, and eliminates the spurious appearance of declining EE dynamism in the US labor market after 2000. We also offer the first evidence of the (large and negative) impact of the COVID-19 crisis on EE reallocation.

Significance of Retention Strategies in Business Services Sector

One of the chief concerns of Business Service Sector is retaining efficient employees. The recruiting team in an organization spends time on identifying candidates and training them, to equip them to be made suitable for the job. If the recruited staff quits without repaying for what he has gained, it results in a setback for the organization. Higher rates of employee’s turnover, which occurs due to increasing competition in labor market, forces the organization to start its work right from the scratch of hiring, training and fostering new entrants. In addition to the financial loss the organization faces due to employee turnover, there is fading employee morale, transfer of knowledge to competitors, and negative impact on the reputation of the organization. The organizations’ have therefore to adopt suitable retention strategies to retain efficient employees. Responses were elicited from employers working in various organizations in Business service sector to explore the need to adopt retention strategies, identify the retention strategies implemented by them, and to discover the importance given to retention strategies. Suitable statistical techniques such as SPSS 20.0 and AMOS have been implemented to derive at reliable conclusion.

РИНОК ПРАЦІ ВОЛИНСЬКОЇ ОБЛАСТІ: СТАТИСТИЧНЕ ДОСЛІДЖЕННЯ ЕКОНОМІЧНОЇ АКТИВНОСТІ НАСЕЛЕННЯ

Багатовимірне статистичне дослідження ринку праці необхідне для прийняття обґрунтованих управлінських рішень на мікро-, мезо- та макрорівні. Воно включає оцінювання ринкової ситуації щодо зайнятості та безробіття, характеристику тенденцій і пропорцій ринку, визначення ефективності попиту та пропонування робочої сили. У статті представлено результати першого етапу комплексного статистичного аналізу ринку праці Волинської області за 2013-2018 роки, а саме економічної активності населення за віковими категоріями, зайнятого та безробітного населення. Здійснено порівняльний аналіз зміни чисельності економічно активного та економічно неактивного населення Волинської області з аналогічними по Україні, аналіз структурних зрушень в чисельності економічно активного населення за рівнем освіти.

Attitudes Toward Immigration: Ethnicity Trumps Skills But Not Legality?

ObjectiveThe objectives of this study were to parse the effect of ethnicity as a potential driver of public perception of immigrants from previous finding on the labor market competition hypothesis (e.g., Hainmueller and Hiscox, 2010; Hainmueller and Hopkins, 2015).MethodsWe rely on survey experiments to analyze the effect of ethnicity on attitude formation toward immigrants. In a first experiment, we test whether favoritism for high‐skilled immigrants diminishes when we add the Hispanic descriptor. In a second experiment, we examine whether public opinion toward undocumented immigrants is affected by region of origin.ResultsWe find that favoritism for high‐skilled immigrants drops when we add the Hispanic descriptor, but that legal status outweighs any possible anti‐Hispanic sentiment.ConclusionOur study provides a novel setup to study the interaction between economic factors and ethnicity as drivers of attitudes toward immigration among California's voters. We find some evidence that supports our hypothesis that anti‐Hispanic sentiment drives attitude formation toward immigrants and immigration.

Talent management in public authorities

Problem setting. Under the conditions of the intense labour market and fierce competition, talented and highly productive workers, who can learn quickly and adapt to rapid changes in the environment, and possess a range of unique skills, knowledge and competence in a particular field are particularly valuable. It was these employees who led the emergence of the new term “war for talent”, which initiated the formation of a whole direction in approaches to personnel management, namely talent management. Because of this, there is a necessity for a deeper understanding of the essence of the talent and the talented employee, as well as the identification of the talent management process as a separate area not only in the business sphere but also the formation of the concept of talent management for its practical application in public authorities. Recent research and publications analysis testified that an important role in the study of the talent management system in general and, in particular, in Ukraine, is played by an analysis of the world experience in this field since there are very few own developments and works. The fundamental bases of talent management are embedded and developed in the research and scientific works of well-known practitioners and researchers, such as M. Armstrong, J. Billberry, L. Jeffrey, S. Zelinskyi, E. Michaels and H. Hendfield-Jones, A. Robertson and G. Abby and others. Highlighting previously unsettled parts of the general problem. Concerning Ukraine, it should be noted that due to the outdated personnel management system existing in domestic organizations, especially in the public sector, this topic is not yet mature enough for a deep study, which, in turn, determines the necessity to research the theoretical aspects of the concept of talent management and to generalize the factors that stipulate the need to implement these processes in Ukraine. Paper main body. Today, more and more companies are realizing the necessity to reorient HR management to the concept of managing talented employees. Talent is the set of human abilities, inherent in his/her giftedness, skills, knowledge, experience, intelligence, prudence, character and energy, as well as the ability to learn and grow. Talent management is a purposeful activity aimed at creating a system of recruitment, development, use and retention of talented employees capable of achieving the best results in the work. With the adoption of up-to-date and topical regulations on personnel management in public authorities in Ukraine, there will be very specific chances to create a truly professional, qualified, stable and politically neutral state apparatus. In this regard, in recent years, there has arisen a necessity in strengthening the strategic role of HRM services in the public administration system, focusing them on organizational and analytical work in personnel management, planning the career of civil servants, forecasting staff development and providing training opportunities. The public authorities of Ukraine do not currently have a system and strategic foundations for talent management. In this context, it is important to talk not only about structural changes but about deep transformation, about values and principles of work of a civil servant, about the introduction of effective methods of motivation and complex approach to assessing personnel activity through the usage of quantitative and qualitative methods of assessment at all levels in the system of public authorities. The introduction of modern practices and technologies of personnel management in the system of public authorities, as well as the creation of separate structural units for the talent management, will improve the personnel management system at public service, ensure an objective process of recruitment and service career, and also strengthen the professional level and its competitiveness in the labour market. Conclusions of the research and prospects for further studies. Basing on the above mentioned, it can be noted that the issues outlined in our study require elaboration and solution at the scientific, theoretical and applied levels, and special attention has to be paid to the unification of the conceptual-categorial system, which is necessary for the harmonization of the processes of forming an effective model of talent management in the public authorities of Ukraine.

Natives’ skills and attitudes towards immigrants: evidence from 20 OECD countries

PurposeThe purpose of this paper is to examine whether natives’ attitudes toward immigration is associated with an influx of high- and low-skilled immigrants. The current research focuses on selected 20 OECD countries as destination countries.Design/methodology/approachA pseudo-panel based on age cohort is constructed to control for the potential unobservable individual characteristics. The random effects and within estimators (where applicable) are applied in the panel-data setting.FindingsRegression results indicate that natives’ attitudes depend on their labor market exposure and skill type. Low-skill immigrant inflows are negatively associated with natives’ attitudes, but the magnitude is reduced proportionally to their share of the high skilled. The association between immigrant flows and attitudes is particularly strong for the prime-age cohorts, which can be explained by the labor market competition mechanism.Research limitations/implicationsGiven the data limitations, not all destination countries could be analyzed but only selected OECD countries. However, this situation has resulted in the sample destination countries sharing similar characteristics with advanced economies.Originality/valueAlthough the majority of previous studies are based on survey questions on attitudes toward immigrants with respective skill type, the current study focuses on the effects of the actual immigration flows. Natives’ attitudes respond sensitively to the actual changes in the number of migrants. The selection of OECD countries makes the characteristics of the destination countries substantially homogeneous.

Introducing minimum wages in Germany employment effects in a post Keynesian perspective

The long ongoing discussion about the employment impact of minimum wages was recently reinvigorated with the introduction of an economy-wide, binding minimum wage in Germany in 2015. In the traditional line of reasoning, based on the allocational approach of modern labor market economics, it has been suggested that the impact is clearly negative on the assumption of a competitive labor market and clearly positive on the assumption of a monopsonistic labor market. Unfortunately, both predictions conflict with the empirical findings, which do not show a clear-cut impact of significant size in either direction. As an alternative, a Post Keynesian two-sector model including an employment market is presented here. Its most likely prediction of a negligible employment effect and a sectoral shift is tested against the German case of an introduction of a statutory minimum wage in 2015. Despite substantial wage increases in the low wage sector, our empirical analysis reveals very low overall employment loss, amounting to about 26,500 workers, as a result of a small sectoral shift from low wage industries to higher wage industries.

Structural Changes in the Labor Market and the Rise of Early Retirement in France and Germany

AbstractThe rise of early retirement in Europe is typically attributed to the European system of taxes and transfers. A model with an imperfectly competitive labor market allows us to consider also the effects of bargaining power and of matching efficiency on pre-retirement. We find that lower bargaining power of workers and declining matching efficiency have been important determinants of early retirement in France and Germany. These structural changes, combined with early retirement transfers and population aging, are also consistent with the employment and unemployment rates, labor share and seniority premia.

STATISTICAL SURVEY OF MIGRATION PROCESSES IN UKRAINE IN CONDITIONS OF EUROPEAN INTEGRATION

The article is devoted to the study of the main indicators of the Ukrainian labor market and the phenomenon of labor migration to the countries of the European Union and the world in general. The peculiarity of this situation and migration policy in our country consists in Ukraine acting simultaneously as the country of origin, destination and transit of migrants. On the one hand, this leads to many problems occurring, on the other hand, it is opening up new opportunities related to migration.The basis of our research was the official statistics of the country's population movements. The analysis of supply and demand in the labor market showed that the supply level was drastically increased. However, the availability of vacancies allows us to state the dissatisfaction of potential employees with those because of their allowance. The structure of unemployment among various professional groups was also investigated.We analyzed the directions, age groups and employment sectors of Ukrainian labor migrants. Moreover, we looked into the financial income of workers from the major labor donor countries. We discovered that the top three countries of labor migration are the Philippines, Pakistan and Ukraine. According to the results of the study of financial revenues, it is found that long-term migrants' transfers to Ukraine make up almost half of the households’ budget.It has also been ascertained that the uncontrolled arrival of workers from abroad increases competition in the national labor market, which may cause a decrease in real wages and an increase in unemployment. Illegal staying of foreigners, and especially them working here, provokes the development of criminal structures, undermining the legal system. Also, foreign migrants who are not cared for by their native country can become an additional burden on the host country's social system.

Who Is a Right-Wing Supporter? On the Biographical Experiences of Young Right-Wing Voters in Poland and Germany

This article explores the selected cases of the biographies of right-wing supporters from a larger sample of narrative interviews with young (18-35 years old) people in Poland and Germany. In the existing literature, we can find the socio-economic explanations of the sources of the right-wing turn (related to economic deprivation, precarisation, social exclusion, labor market competition with immigrants and others), as well as cultural explanations connected with new identity politics, symbolic exclusion and divide between society and political elites, the disembedding from previously solid communities, and the fear of new risks related to the inflow of cultural Others. Despite notable exceptions, it is rather uncommon to discuss in this context the actual biographical experiences of right-wing and far-right supporters. In the article, we take a closer look at four biographical cases of people declaring their political support for far right parties. The analysis of the cases leads to the distinction of socio-economic and socio-political pathways to right-wing populist support.

IMPACT OF SPECIFICITY OF BUSINESS AND ACTIVITY OF ORGANIZATION ON EMPLOYMENT OF FREELANCERS

Business operations in today's highly dynamic and changing environment require quick response and adaptation to new business conditions. In this context, the terms "outsourcing" and "freelancing" are emerging. Due to their characteristics and new approach in the business environment, they enable different concepts of organizing and creating new business models. This paper puts in focus the problem of freelance status in the labor market competition for a business engagement. It has the task of providing a scientific view of the opportunities offered to freelancers according to the attitudes of potential employers. From the standpoint of the employers in the Republic of Croatia, business practice has changed considerably from the previous emphasis on 'permanent employment' in the past decade to a more significant selection of outsourcing for specific jobs. Employees’ views are also noticeably changing, so a more significant selection of independence in some legal forms of employment can be observed. An exploration of the attitudes and experiences of the employers on the recruitment of freelancers for occasional or permanent jobs in various areas of activity was conducted. The fundamental question to which research has to answer is whether an employer will decide to hire a freelancer in specific jobs for which key knowledge or company information is needed. There are four variables are in focus: how employment of a freelancer depends on the activity the company is engaged, the market in which it operates, the size of the company and previous experience with hiring freelancers.

SOCIAL SECURITY OF UKRAINE AND THE EU: ASPECTS OF CONVERGENCE AND IMPROVEMENT OF MIGRATION POLICY

Unresolved problems of social and economic development of Ukraine, exacerbated by critical negative consequences of military aggression and political instability, are accompanied by deep socio-economic contradictions and aggravation of large-scale social problems. At the same time, the qualitative system of social security, characteristic of the EU, is not formed. As a result, negative phenomena and trends are accumulated in social sphere there that manifest themselves in the critical deformations of social development, with the formation of threats of degradation and depopulation, the increase of environmental problems, deterioration of social structure, weakening of social guarantees of human rights that are evidenced and confirmed by mass and active labour migration of the Ukrainians abroad. Ensuring Ukraine’s social security objectively requires an in-depth study based on a systematic approach, applying EU principles, provisions, practices, and standards. The purpose is to substantiate approaches and means of convergence of social security of Ukraine and the EU and develop recommendations for the improvement of migration policy. Methodology. As the methodological basis of the study, theories of socio-economic growth, modern concepts of institutional and structural economic reforms have been worked out, methods of statistical, structural-functional, and system analysis, grouping have been applied. Results. The imbalances of social security of Ukraine and the EU have been determined according to the following components: labour market and employment of population; reproduction of population and labour potential of the state; migration and food security. Areas of accelerated asymmetry increase in the social development of Ukraine and the EU, which serve as a key factor in “pushing out” the population and high rates of labour migration from Ukraine to the EU Member States, have been identified. Strategic approaches and means of equalizing critical deformations and convergence of the system of social security of Ukraine in the process of integration into the EU have been determined; tools for improving the state migration policy have been developed, which implementation would result in improvement of the systemic and structural characteristics of labour potential migration. Conclusion. The study results obtained represent the existence of significant disparities in key indicators and components of the social security system of Ukraine and the EU. Low level of living standards and social protection of population serves as a factor in increasing the scope of external labour migration and, correspondingly, a critical weakening of human and labour potential of the state. Tools and means of the state policy of convergence of the social security system of Ukraine and the EU should focus on achieving the goal of systemic development of human capital and be implemented in the following directions: ensuring demographic security, upgrading health care system, renovating the quality of education, preserving cultural values, establishing a competitive labour market, improving housing affordability, social infrastructure development, systemic social insurance of population.

Non-Competes, Human Capital Policy & Regional Competition

In the past few years, human capital law has become one of the most dynamic policy fields in the country. Multiple states have reformed their noncompete policies, passing new legislation that limits their use. New bills that would similarly limit the enforcement of noncompetes are currently before Congress. Both the use of noncompetes and litigation over their enforcement, are on the rise nationwide, and several state attorney generals have taken up the issue by launching investigations into employers who require their workforce to sign unenforceable noncompetes. An equally dazzling wealth of studies, analysis, intellectual debates, and exchanges have emerged on the research side. In particular, the past few years brought a significant number of empirical, experimental, and theoretical studies offering more evidence and explanations about the key role that human capital policy, including noncompete contracts, plays in industries and regions. This article, written for a symposium honoring the scholarship of Professor Ronald Gilson, I present the state of the scholarly field on human capital and economic competition and develop three arguments about the future of noncompete research. First, in Part I, I unpack the multiple dynamic effects that job mobility and noncompetes have on regions. Beyond knowledge spillovers, it is important to recognize a range of distinct, though interrelated effects. These include at least ten important aspects that are supported by job mobility: behavioral, dynamic, firm-level, and regional-level effects. In particular, a neglected aspect in the literature of noncompetes is the disproportionate harmful effect noncompete clauses may have on women. Recent economic research on labor market monopsonies and the relationship between mobility and wage growth allows us to see connections between innovation policy and distributive justice. Second, I argue that while the study of noncompetes has been invaluable to understanding talent flows, mobility restrictions are far broader than merely formal covenants not to compete. Covenants that restrict employee mobility appear in many shapes and forms. I introduce the range of contractual restrictions that employers require in standard agreements and I argue that these restrictions too, should be understood and researched through the lens of labor market competition and mobility. Third, I argue that the prevalence of practices that subvert policy requirements, such as including unenforceable restrictions in employment contracts underscores how we as scholars need to encompass market practices in the empirical research, as well as recognize comparative advantages of proactive solutions including antitrust and regulatory tools over contract doctrine.

On the heterogeneous short‐term effects of minimum wages on labor demand

AbstractA strand of the literature documents no effects or even positive effects of a higher minimum wage on employment. This evidence is frequently linked to the existence of monopsonistic labor markets or search frictions. However, empirical studies show that these findings could be related to a low short‐term minimum wage–employment elasticity in a competitive labor market. We show that mixed theoretical employment effects of a minimum wage policy can be predicted in the short term in assignment economies with price‐taker agents and no search frictions.

Evidensbaserad metod eller praktisk verksamhet?

Evidence-based method or practical support for users? – Supported Employment without IPSSince the Mental Health Reform of 1995, the social service in Sweden is required to offer ”meaningful activities” to persons with mental health impairments. This requirement has usually been met by the social service’s ”daily activities” centres, which do not have contact with the competitive labour market. ”Supported Employment” (SE) is a method which can be used to help people with mental health, neuropsychiatric or intellectual impairments to regular work places. Based on international research, the SE model ”Individual Placement and Support” (IPS) is recommended in national guidelines as an evidence-based method. However, IPS can be difficult to implement, since the model requires integrated teams, while in the Swedish system health care, social service and vocational rehabilitation belong to different sectors. Another reason is that subsidized forms of employment and internship are more usual in Sweden than in many other countries. This study investigates SE practices in three municipalities which do not follow all of the IPS model’s eight ”basic principles”. The results show that after 18 months many persons who had been totally without regular activities, or had access only to a daily activities centre, had some form of work or internship at regular workplaces. Twenty per cent had paid employment. The author interprets IPS as a ”packaging” of SE which the municipalities have ”translated” locally to offer SE activities which benefit users. This can also be seen as evidence-based practice (EBP), in which the best available research has been combined with the wishes of users and the professionals’ judgement of what is possible to offer in practice. Further research is needed concerning the value for users of prolonged internships which do not lead to paid employment.

ПРОБЛЕМА ПРОФЕСІЙНОЇ ПІДГОТОВКИ ФАХІВЦІВ МОРСЬКОЇ ГАЛУЗІ У НАУКОВО-ПЕДАГОГІЧНІЙ ТЕОРІЇ

The article is based on the systematization of scientific and pedagogical works related to the professional training of maritime professionals in the Google Scholar Scientific Search System and the electronic catalogs of the National Library of Ukraine. Author submitted his quantitative and qualitative analysis. The dissertation researches of modern Ukrainian scientists, in particular Barsuk S.L., Voloshinov S.A., Gerganov L.D., Dobroshtan O.O., Kozak S.V., Litvinenko I.Y., Osadcha K.P., Primina N.M., Sokol I.V., Spichak T.S., Frolova O.O. are analyzed in detail. Thus, based on scientific activity, which has been documented in different time periods, there has been an increase in research on the professional training of maritime professionals and in particular ship navigators. The following aspects of studying the problem of professional training of specialists in the marine industry in the scientific and pedagogical theory have been identified: formation of foreign language competence (Barsuk S.L., Kozak S.V., Litvinenko I.Y., Primina N.M.), formation of professional competence (Gerganov L.D., Sokol I.V.), algorithmic training (Voloshinov S.A.), mathematics teaching (Spichak T.S., Dobroshtan O.O.), formation of socio-cultural competence (Frolova O.O.), training for profession-oriented communication (Smelikova V.B.). In the work it is noted that the dissertation research aspects in the formation of foreign language communicative competence of maritime specialists are based on the requirements of the international maritime industry documents, especially the professional activity in multinational environment and increasing competition in the global labor market. The study also points out that the formation of the same professional competence of navy professionals is theoretically and experimentally tested by structural models in the process of study of professional disciplines and production. It is noted that the study of mathematics by future maritime specialists should be built on the model of a methodological system for the implementation of cross-curricular links. Further searches are seen in the study of the analysis of practical experience of professional training of marine industry in Ukraine. Keywords: marine industry specialists, vocational training, pedagogical theory.