Labor Market Experience Research Articles

Does employer learning with statistical discrimination exist in China? Evidence from Chinese Micro Survey Data

Because employers cannot perfectly recognize workers’ actual ability when recruiting, they have rational expectations for worker productivity only through considering easily observable characteristics such as education. However, with the increase in labour market experience, employers gradually learn actual productivity through historical working performance. The above phenomenon is called employer learning with statistical discrimination (EL-SD). This paper confirms that EL-SD significantly exists in the Chinese labour market based on Chinese Household Income Program (CHIP) data from 2013 and Chinese Family Panel Studies (CFPS) data from 2012 to 2014. Furthermore, EL-SD is hardly corroborated for advantaged workers such as males, college graduates, highly skilled workers, high wage earners, and workers in large businesses or the urban labour market.

International student mobility and the transition from higher education to work in Norway

The purpose of this paper is to investigate whether international student mobility (ISM) has an impact on the transition from higher education to work. Two measures of labour market outcomes are investigated: unemployment and skills mismatch. To go beyond existing research, we analyse whether the effect of ISM on these outcomes vary by fields of study, intake grades, sociodemographic variables and more. Our analyses are based on data from the Norwegian graduate surveys time series from 2007 to 2017. After controlling for several confounding factors, we find very small differences in labour market outcomes between graduates with and without ISM experience. In comparison with field of study, immigrant background, previous labour market experience and business cycles, the effect of ISM on the examined labour market outcomes is small. Investigating whether graduates with different backgrounds benefit differently from ISM, we find evidence of moderate effect heterogeneities: Graduates with high intake grades and graduates in business and administration seem to benefit somewhat more. Regarding social origin and immigrant background, no heterogeneous effects are found. Contrary to findings from previous studies, we do not find that those least likely to study abroad benefit the most from it. Rather, there is a tendency that groups with the greatest likelihood of studying abroad are those who benefit most.

The Long-Run Effects of the Earned Income Tax Credit on Women's Labor Market Outcomes

Using longitudinal data on marriage and children from the Panel Study of Income Dynamics from 1967 to 2016, we characterize women's exposure to the federal and state Earned Income Tax Credit (EITC) during their first two decades of adulthood. We use measures of this exposure to estimate the long-run effects of the EITC on women's labor market outcomes as mature adults, specifically at age 40. Although the sample size is small, our results suggest that exposure to a more generous EITC when mothers were unmarried and had older (school-age) children leads to higher earnings in the longer-run, and we find corresponding evidence suggesting that longer-run exposure of unmarried mothers to a more generous EITC increases cumulative labor market experience. Additionally, we find evidence to suggest that exposure to a more generous EITC when women had children while married leads to lower earnings and hours in the longer-run. For both groups, adjustments in hours worked along the intensive margin appear to drive these results. These longer-run effects are consistent with what we would expect from the short-run effects of the EITC on employment and hours predicted by theory and documented in other work.

Life-cycle factors and entrepreneurship: evidence from rural China

This paper investigated the association between life-cycle factors and entrepreneurship. We provided a comprehensive investigation into life-cycle factors, such as marriage, health, education, age, previous labor market experience, and gender of children. Moreover, we focused on rural persons, who are confronted with a disadvantageous entrepreneurial environment. We found that marriage was positively associated with the likelihood of entrepreneurship, and the association existed only among rural men. Educated persons and healthy persons were more likely to engage in entrepreneurial activities. In particular, previous hospitalization experience and high medical expenses were negatively associated with entrepreneurship, while minor health problems were not correlated with entrepreneurship. Concerning the gender of children, daughters instead of sons were positively correlated with entrepreneurial probability, and the correlation was stronger and more significant among rural men. Our results could be useful for policymakers seeking to incentivize entrepreneurship among rural residents in developing countries.

Improvements in Electronic Job Alerts and the Labour Market Experience of Unemployed Workers: Evidence from the Connecting Canadians with Available Jobs Initiative

In 2013, the Canadian government introduced improvements to its electronic Job Alerts notification service that emails job seekers about job openings posted on an online job board. The improvements included additional advertisements of the service and increases in the frequency and scope of notifications sent to subscribers. Using data on workers who lost their jobs either before or after the intervention, we find that subscription to Job Alerts increased after the intervention. This finding is significant because we also find that, compared with non-subscribers, subscribers to Job Alerts spent more hours searching per week and were more likely to secure a permanent job after holding a contract job. We find little evidence of any improvements in the effects of subscription on job search outcomes after the enhancements. Our evidence suggests that the limited effects of this intervention might be due to subscribers’ failure to make use of the various enhancements.

Employer learning, statistical discrimination and university prestige

This paper investigates whether employers use university prestige as a signal of workers’ unobservable productivity. Our test is based on employer learning-statistical discrimination models, which suggest that if employers use university reputation to predict a worker’s unobservable quality, then college prestige should become less important for earnings as a worker gains labor market experience. In this framework, we use a regression discontinuity design to estimate a 13% wage premium for college graduates in their first year of the labor market who were barely accepted by one of the two most prestigious universities in Chile compared with those barely rejected by these two schools. However, we find that this premium decreases to 4% for workers with 6 or more years of labor market experience. This result suggests that college prestige becomes less important for employers as workers reveal their quality throughout their careers.

Labour market transition and experiences of unemployed graduates: An exploratory study

Young people in countries such as South Africa are finding it difficult to make a successful school-to-work transition. This is exacerbated by high unemployment and uncertainty in the labour market. The South African government appears to be trying to implement a range of strategies and approaches to try and assist unemployed graduates. However, the onus is also on the graduate to look for ways in dealing with the uncertain labour market. The purpose of this research was to investigate the labour market transition and experiences of unemployed graduates within the context of high unemployment in South Africa. The research utilised an interpretivist philosophy hinging on the qualitative approach, and it used an exploratory research design. Further, a longitudinal technique was employed, tracing over a period of two years the labour market experiences and transitions of a sample of 30 graduates who had been enrolled at a historically disadvantaged higher education institution in South Africa. Data was collected from focus group discussions and unstructured individual interviews over this two-year period. The findings obtained through structural narrative analysis revealed that the labour market transition and experiences of the unemployed graduates were not negative only; some of the graduates had used their own resourceful techniques to deal with challenges. Based on the findings of the research and in view of the uncertain labour market, suggestions were made that would have resonance for not only individuals but also policymakers, career counsellors and institutions of higher learning.

Labour market transition and experiences of unemployed graduates: An exploratory study

Young people in countries such as South Africa are finding it difficult to make a successful school-to-work transition. This is exacerbated by high unemployment and uncertainty in the labour market. The South African government appears to be trying to implement a range of strategies and approaches to try and assist unemployed graduates. However, the onus is also on the graduate to look for ways in dealing with the uncertain labour market. The purpose of this research was to investigate the labour market transition and experiences of unemployed graduates within the context of high unemployment in South Africa. The research utilised an interpretivist philosophy hinging on the qualitative approach, and it used an exploratory research design. Further, a longitudinal technique was employed, tracing over a period of two years the labour market experiences and transitions of a sample of 30 graduates who had been enrolled at a historically disadvantaged higher education institution in South Africa. Data was collected from focus group discussions and unstructured individual interviews over this two-year period. The findings obtained through structural narrative analysis revealed that the labour market transition and experiences of the unemployed graduates were not negative only; some of the graduates had used their own resourceful techniques to deal with challenges. Based on the findings of the research and in view of the uncertain labour market, suggestions were made that would have resonance for not only individuals but also policymakers, career counsellors and institutions of higher learning.

Labor market influences on Women's fertility decisions: Longitudinal evidence from Canada

While fertility theories suggest that insecure labor market experiences encourage women to postpone having children, few have examined whether job insecurity perceptions influence fertility in the North American context—an omission we address in the current study. Findings from event history analyses of a panel dataset of Canadian workers (Canadian Work, Stress and Health Study) reveal that perceived job insecurity is salient for women's first birth decisions but not subsequent births. Further subgroup analyses show that the association between perceived job insecurity and likelihood of a first birth is limited to college-educated women and those in low unemployment labor market regions. Among women with less than a college degree and those in high-unemployment regions, the likelihood of a first birth does not vary by respondents' perceptions of insecurity. Results suggest a more nuanced relationship between insecure work and women's childbearing decisions than predicted by traditional pro-cyclical accounts of the economy-fertility association.

Switching from an inclining to a zero-level unemployment benefit profile: Good for work incentives?

This paper evaluates the impact on the transition to work of a policy reform in Belgium that restricted the access to a specific unemployment insurance scheme for young labor market entrants. This scheme entitles youths with no or little labor market experience to unemployment benefits after a waiting period of one year. As of 2015, the Belgian government unexpectedly scrapped benefit eligibility for youths who start the waiting period at the age of 24 or older. The reform implied a change from an inclining to a flat rate (zero-level) benefit profile. We use a difference-in-differences approach to identify the causal impact of this reform on fresh university graduates. Our main finding is that this reform only increases the transition to very short-lived jobs.

The Labor Market Experience and Impact of Undocumented Workers

Working Paper 2008-7 February 2008 Abstract: Using administrative data from the state of Georgia, the authors find that a greater share of undocumented workers in an industry has a statistically significant negative impact on the wages of documented workers. The practical impact, however, is small, given the size of the undocumented workforce. In addition, undocumented workers have significantly lower labor supply elasticity, likely as a result of their limited employment and grievance opportunities. Furthermore, the inflow of undocumented workers does more to displace earlier hired undocumented workers than it does to displace documented workers. JEL classification: J61, J31, J42, F22 Key words: illegal immigration, wage impact, worker displacement The Labor Market Experience and Impact of Undocumented Workers I. Introduction and Background The United States has a long history of immigration debate. Through the last century and into this one, immigration policy has been subjected to changing economic needs, fears, and political whims. Positive contributions of immigration have been identified by Neal and Uselding (1972) who estimate that the flow of immigrants into the United States between 1790 and 1912 resulted in a 13 to 42 percent higher level of capital stock than would have prevailed in the absence of immigration during these years (also see Barro and Sala-i-Martin 1995 and Chiswick et al. 1997). (1) Immigration has also been more recently explored in various countries as a mechanism for replacing retiring baby-boom workers (e.g., Hamada and Kato 2007, Hotchkiss 2005, Denton and Spencer 1997). The concerns surrounding immigration are rooted in an expectation that the arrival of new workers into a labor market would displace native workers and/or put downward pressure on wages. The literature presents a wide range of estimates of the effects of immigration on wages and employment of native workers. The consensus settles on a one to four percent decrease in native wages resulting from a 10 percent increase in the population share of immigrants (for example, see Friedberg and Hunt 1995 and Borjas et al. 2006). The measured impact of immigration on the displacement of workers is less clear. Card (1990), Wright et al. (1997), Butcher and Card (1991), and Card and DiNardo (2000) find no evidence of immigrant inflows affecting native migration patterns or employment outcomes. Whereas, Frey (1996) and Borjas (2005) identify a significant relationship between immigrant inflows and either native outflows or lower net native in-migration, and Card (2001) finds lower rates of employment within cities with high immigrant arrivals. While firmly rooted in the empirical literature measuring the impact of legal immigration on the labor market experiences of natives, this paper deviates slightly by exploring the impact of undocumented workers (assumed to be immigrants) on wages of documented workers, some of which are likely immigrants themselves. The analysis makes use of administrative data from the state of Georgia to investigate how the proportion of undocumented workers affects the wages of documented workers, the displacement of documented workers, and what role different labor supply elasticities might play in the observed wage gap between the two groups of workers. The results presented in this paper are of particular relevance as the immigration debate has recently narrowed its focus on undocumented immigrants. A. The Impact of Immigration The impact of immigration on native worker wages essentially comes down to how complementary or how substitutable the immigrants are with native workers, and how responsive native migration patterns are to the influx of additional workers. Goldin (1994) documents significant wage effects of the large European migration to the United States in the early 20th century. Measured effects of more recent waves of immigrants have been more modest. …

Interfirm Mobility, Wages and the Return to Seniority and Experience in the U.S.

In this paper we follow on the seminal work of Altonji and Shakotko (1987) and Topel (1991) and reinvestigate the return to seniority in the U.S. These papers specify a wage function, in which workers' wages can change through two channels: (a) return to their seniority; and (b) return to their labor market experience. We start from the very same wage equation, and, following our theoretical model, we explicitly include a participation equation and an interfirm mobility equation. The participation and mobility decisions define the individuals' experience and seniority. Because experience and seniority are fully endogenized, we introduce in the wage equation a summary of workers' career and past jobs. Together with this last equation, the three-equations system is estimated simultaneously using the Panel Study of Income Dynamics (PSID). For all three education groups that we study, returns to seniority are quite high, even higher than what Topel obtained. On the other hand, the returns to experience appear to be similar to those previously found in the literature.

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.

Negotiated Agency amidst Overlapping Vulnerabilities of Women Migrant Workers in South Asia

Marriage, family reunification, forced labour and trafficking are some of the most widely attributed causes of women’s migration within South Asia. This paper contributes to a small but growing literature about women’s migration within South Asia for employment amidst social, cultural and policy level barriers that hinder women’s mobility choices. It examines the experiences of 45 migrant women from economically poorer backgrounds comprising both cross-border, undocumented migrants from Nepal and Bangladesh and internal migrants from India working in informal jobs within India. This paper also explores similarities and differences between migration and labour market experiences of women migrants in South Asia showing how migration for employment can contribute towards agency formation but at the same time increase vulnerability by bringing about a reduction in well-being, security and dignity in the absence of secure policies that address challenges of women migrants in the region.

SHOULD I STAY OR SHOULD I GO? CAREER CHOICES FOR YOUNG WORKERS IN LATIN AMERICA

This paper presents the first estimates of the returns to formal labor market experience and tenure in a developing country context. We take advantage of rich matched employer–employee data from Brazil and Chile, exploiting job displacement as a source of identification. We find positive returns to both dimensions in these countries, with larger returns to tenure in Brazil and larger returns to experience in Chile. Our findings suggest the more rigid Brazilian labor legislation may encourage firms to invest in young workers' specific skills. Chile's institutions, on the contrary, might promote the acquisition of general skills. (JEL J24, J31, M50)

A closer look at labour market status and crime among a general population sample of young men and women.

Those in the most criminally active age groups are facing particular difficulties in entering the labour market and accumulating stable work experiences. This study uses a large representative sample of Finnish adolescents to examine how different labour market statuses are associated with crime. Both for men and women, within-individual variation in employment is inversely linked to all crime measures considered, albeit to a different extent. In addition, qualitatively different categories of non-employment (e.g., non-participation without legitimate reason, studying, being on parental leave) are distinctly associated with crime. The findings underscore the importance of a detailed conceptualization of labour market status in research that aligns with the changed nature of employment and approximates the actual labour market experiences of young adults.

Impacts of negative labor market experiences on the life satisfaction of European East–West mobile workers: Cross-border commuters from the Czech Republic, Slovakia and Hungary in Austria

This article investigates the impacts of negative labor market experiences on the life satisfaction of European East–West mobile workers by taking Czech, Slovak and Hungarian cross-border commuters working in Austria as an example. The recent literature has indicated a ‘dark side’ of East–West mobility, as many mobile Eastern Europeans face negative labor market experiences in the Western labor markets. If East–West commuters accept such experiences, employers and employees may quite easily subvert working standards, with detrimental effects on host countries that are intertwined in cross-border labor markets. Empirically, this study used a sequential mixed-methods design, based on quantitative and qualitative data from a research project on East–West commuters in Austria. The empirical findings showed that the negative labor market experiences are not important for commuters’ life satisfaction. From a multitude of those experiences under investigation, only ethnic discrimination experiences had a significantly negative impact. Instead, life satisfaction was mainly influenced by the overall health status and the perception that one’s own living conditions have improved in comparison with those of others from one’s country of origin. The in-depth qualitative findings corroborated the quantitative findings in terms of the low relevance of negative labor market experiences for the subjective assessments of commuting.

Race Differences in Motivations for Joining Unions: The Role of Prosocial Beliefs

ObjectiveThis article investigates whether a prosocial orientation—which stresses unions’ concern for all working people—might differentially influence whites’ and African Americans’ decisions to join unions.MethodsLogistic regression using data from the 2005 AFL‐CIO Union Message Survey.ResultsAfrican Americans’ odds of voting “yes” in a hypothetical union election are nearly two times greater than whites’ odds, and prosocial beliefs partially mediate this effect.ConclusionA model of unionism that seeks political goals beyond narrow workplace ones (i.e., that capitalizes on the prosocial orientation documented here) may increase unions’ success in attracting African‐American members, thereby improving African Americans' labor market experience and revitalizing the labor movement.

Color discrimination, occupational prestige, and skin color in Brazil

ABSTRACTExisting literature pertaining to discrimination in Brazil often uses education and income as measures of class, but seldom includes occupational prestige. However, occupation, an aspect of daily life and a socioeconomic indicator, may explain a large amount of variation in acknowledgement of skin color discrimination among blacks and browns in Brazil. In this study, we examine whether those in different occupations acknowledge skin color discrimination differently. Based on existing literature, the expectation was that individuals in high status occupations would be more likely to acknowledge skin color discrimination. However, to the contrary, our analysis of the 2010 Latin American Political Opinion Project survey, in which we utilize an ordered logistic regression model with controls for education, expected labor market experience, gender, household income, skin color, location, and province, reveals blacks and browns in less prestigious occupations are more likely to report experiencing color discrimination, particularly among men. This study offers new insights about perceptions of color discrimination in Brazil by challenging the traditional idea that high status blacks and browns are more aware of color discrimination than those of lower status. Also, these findings are important to research on race and ethnicity generally, bridging studies in sociology, Latin American studies, and African diaspora studies.

Long-Term Effects of School-Starting-Age Rules

To study the long-term effects of school-starting-age rules in a setting with early ability tracking, we exploit the birth month threshold used in the Netherlands. We find that students born just after the threshold perform better at the end of primary school than students born just before it. This translates into increased placement in high ability tracks in secondary education. This difference diminishes gradually during subsequent stages, and we find no effect on the highest attained educational level. Those born just before the threshold enter the labor market somewhat younger and therefore have more labor market experience and higher earnings at any given age until 40. We conclude that early ability tracking does not harm long-term outcomes of children who were, for exogenous reasons, placed in a lower track.