Labor Market Inequality Research Articles

A Social Network Analysis of Occupational Segregation

We propose an equilibrium interaction model of occupational segregation and labor market inequality between two social groups, generated exclusively through the documented tendency to refer informal job seekers of identical “social color”. The expected social color homophily in job referrals strategically induces distinct career choices for individuals from different social groups, which further translates into stable partial occupational segregation equilibria with sustained wage and employment inequality – in line with observed patterns of racial or gender labor market disparities. Supporting the qualitative analysis with a calibration and simulation exercise, we furthermore show that both first and second best utilitarian social optima entail segregation, any integration policy requiring explicit distributional concerns. Our framework highlights that the mere social interaction through homophilous contact networks can be a pivotal channel for the propagation and persistence of gender and racial labor market gaps, complementary to long studied mechanisms such as taste or statistical discrimination.

Firms and inequality when unemployment is high

How important are firms for wage inequality in developing countries where structural unemployment is high? Research focused on contexts close to full employment has suggested a substantial role of firms in labor market inequality. Using matched employer–employee data from South Africa, I find that firms explain a larger share of wage variation than in richer countries. I consider drivers of this, documenting first a higher productivity dispersion as found for other developing countries. Secondly, I estimate the separations elasticity by instrumenting wages of matched workers with firm wages, and I find a low separations elasticity. This generates a high degree of monopsony, and the correspondingly high estimated rent-sharing elasticity helps explain the important role of firm wage policies in inequality. Monopsony may be driven by higher unemployment, and regional heterogeneity provides suggestive evidence for this. Such firm-level competitive dynamics may exacerbate inequality in developing countries more generally.

The State and the Labour Market Segmentation in Bulgaria – What Do the Results of the Implementation of the 60/40 Measure Reveal?

Since the COVID-19 outbreak, Bulgaria has mobilized significant financial resources to overcome the consequences of the pandemic on the economy, labour market and household wellbeing. The 60/40 measure, under which employers from affected sectors can receive financial support to retain existing jobs, became a significant element of these efforts. With a budget of almost 2 billion BGN, the measure supported the retention of over 340 000 jobs. From a research point of view, however, its social impacts, including on labour market inequalities, remain insufficiently clear. This paper tries to contribute to the fulfillment of this gap by putting the results of the implementation of the 60/40 measure in the context of the problem about the labour market segmentation. Based on freely accessible data published by state institutions, the paper discusses the existence of some disbalances linked to the implementation of the 60/40 measure which could deepen the labour market inequalities and expand the segment of jobs with worsening wage adequacy. In that regard, areas of future research and possible improvements of the approach towards the study of the impacts of the measure have been identified. Moreover, the discussed problem areas shed light on some aspects regarding the role of the state and public policies in shaping the labour market segmentation in Bulgaria.

The motherhood penalty in China: Magnitudes, trends, and the role of grandparenting

This paper estimates the labor market impacts of parenthood in China. We find that becoming a mother has negative impacts on women's labor outcomes. But the impacts appear to recover sooner than what has been found in other countries. A decomposition exercise suggests that parenthood plays a limited role in explaining the large gender inequality in China's labor market. We document a form of intergenerational arrangement that is prevalent among Chinese families: Upon the arrival of a child, grandmothers substantially reduce market labor supply and provide much of the childcare. Grandparents’ help with childcare likely plays an important role in alleviating the motherhood effect. Suggestive evidence indicates that in return, grandparents who help with childcare receive more intra-family transfers and report higher subjective wellbeing. We further show that the motherhood effect, though relatively small, has increased substantially over the past decades. The rising gender gap in the labor market, the declining state sector that historically provides more flexible accommodations for working mothers, and the abolishment of the one-child policy all suggest a rising burden of motherhood on labor market outcomes.

Mental health inequalities in times of crisis: evolution between 2005 and 2021 among the Spanish salaried population

BackgroundStudying the working population’s mental health in times of crisis (such as the 2008 recession or the COVID-19 pandemic) is very relevant. This study aims to assess the prevalence of...

A year of COVID: the evolution of labour market and financial inequalities through the crisis

Abstract We use high-quality UK panel data to document the extent that pre-existing labour market and financial inequalities were exacerbated by the pandemic between April 2020 and September 2021. Some inequalities worsened, others did not, and in some cases, initial widening of labour market inequalities was subsequently reversed. We find no evidence of an overall divergence in labour market outcomes by gender. Initial changes for ethnic minorities and the young were largely reversed by March 2021. Those in the top third of the long-run income distribution experienced income falls, but also increased saving. Net wealth increased not for only the affluent, but also for middle deciles of the long-run income distribution. These deciles were most protected by the furlough scheme. Those at the bottom of the income distribution were more likely to report a decline in net wealth over the year.

Gender Composition and the Symbolic Value of Occupations: New Evidence of a U-shaped Relationship between Gender and Occupational Prestige Based on German Microdata

Occupational prestige is an important yet understudied factor in gender labour market inequality. This study examines the relationship between the gender composition of occupations and the prestige of those occupations, and investigates whether men and women differ in their evaluations. A multilevel analysis based on German microdata generated two key findings. First, occupations that are predominantly male or female tend to be rated as more prestigious than mixed-gender occupations when controlling for pay and educational requirements, suggesting a segregation premium in the symbolic valuation of work in Germany. Second, there is no evidence of a gendered in-group bias in Germany; both men and women consider gender-segregated occupations to be more prestigious, with no preference for occupations dominated by their own gender.

An Analysis of the Gender Inequality Issues in the United Kingdom’s Employment Relationship—Based on the Current Situation and Theoretical Approach

The impact of the Covid-19 epidemic on the British labor market has sparked concern for disadvantaged groups in employment relations. This paper examines the current state of gender inequality in the British labor market and the three theories that attempt to explain it: human capital theory, social and cultural norms theory, and institutional discrimination theory, to answer the question of how to improve gender inequality in the British labor market. Through a critical analysis of three approaches to equality and diversity and the principal actors in industrial relations, this paper concludes that a combination of liberal, radical, and diverse approaches is advantageous and that the state and main actors in industrial relations must collaborate more.

Gig Workers, Social Protection and Labour Market Inequality: Lessons from Malaysia

Gig Workers, Social Protection and Labour Market Inequality: Lessons from Malaysia

At Work in a Pandemic: Black Workers' Experiences of Safety on the Job.

Race and labor scholars have argued that precarious, dangerous work, along with the work of social reproduction, has long been disproportionately placed on Black workers. This research examines how the COVID-19 pandemic impacted essential in-person workers differently by race. Using data collected from approximately 8,000 respondents in five survey waves, we find that Black essential and in-person workers were far more likely to experience safety concerns on the job than white workers, from inadequate sick leave and protective gear in the early pandemic to customers who refused to mask in later months. This pattern extended to stress off the job, where Black workers were more likely to have experienced food, childcare, and housing insecurities. Black workers were also more likely to be interested in unionization. These findings point to distinct ways in which the COVID-19 pandemic has collided with Black workers’ struggle for economic inequality and amplified existing patterns of labor market inequality.

Inequality, Informality, Marginality and Unemployment (IIMU) in Indian Labor Market during Covid-19 Pandemic

This paper examines inequality, informality, marginality and unemployment in Indian labor market during Covid-19 Pandemic. These four concepts are dynamically examined in the context of wage code, 2019 and the recent three labor codes, 2020 passed in parliament by the central government to expand the neo-liberal global capitalism agenda to increase surplus rate via higher exploitation rate of workers. The paper also critically analyses the economic package announced by the government with insignificant share of fiscal policy measures rather monetary policy measures including loan and credit. Alternatively, this paper advocates a fiscal stimulus package to counter the challenges of lives and livelihood of the workers especially informal workers in the Indian labor market.

Decent Work in the South African Macroeconomy: Who are The Winners and Losers?

Concerns related to the future of work has precipitated various studies aimed at ensuring that the labour market is a place where people can earn a living, work in dignity, and flourish as human beings. Studies on labour market inequalities and how macroeconomic policies can be used to address such inequalities are also plentiful. What macroeconomic studies have often failed to do, however, is highlight the differences between individuals in the labour market. This is important, especially in an economy with large inequalities, such as South Africa. These inequalities are further entrenched given that wage employment is the primary mode of income generation for the majority of households in South Africa. The purpose of this study was to investigate changes in quality of work at the microeconomic level in relation to changes in the macroeconomy, using a decent work index built from secondary labour force survey data. The data show that changes in the macroeconomic policy environment coincide with differential outcomes for different groups of workers in the labour market, with women benefitting in terms of quality of work during times in which the government undertakes an expansionary fiscal approach, although only in occupation groups which are male-dominated. The study also finds, however, that in some occupation groups, quality of work does not change in relation to shifts in the macroeconomy. The study highlights the need for microeconomic analyses to inform macroeconomic policies to ensure that expected outcomes are distributed in the intended way.

Unwanted Consequences: The Trade-Off between Gender Equality and Precarity in Saudi Arabian Context

This paper looks at the Saudi state policies impact on reducing labour market inequalities and increasing female labour force participation against the socio-institutional backdrop of enduring patriarchy and gender segregation. Analysis of twenty-six in-depth interviews with employees (men and women) and other stakeholders in the retail sector offered contributions to extant precarity research by unpacking both socio-institutional and organisational mechanisms that contribute to/exacerbate structural precarity. Specifically, we highlight psychological precarity as experienced by both genders. For men, this is heightened in job insecurity and weakening of the family ideology and the breadwinner model, while for women it is portrayed in the internalisation of sexual harassment given their socio-economic vulnerability and lack of organisational protection(s). We highlight how structural changes via state-driven policies may clash with the slower to change societal structures and socio-religious norms; resulting in the experience of both structural and psychological precarity in workplaces.

Identifying the Wage Differential in the Temporary Employment Services Sector: Evidence for South Africa using Administrative Tax Records

Although the temporary employment services (TES) or labour broker sector has been growing in recent decades, and there has been much heated public debate on whether the jobs offered constitute ‘decent work’, there has been little empirical research on this sector in developing countries. In this paper, we use a unique administrative panel dataset based on income tax records for the period 2011–2015 in South Africa, to explore the wage and benefits differentials between TES and non-TES workers. We find a substantial gross wage differential of around 88 per cent, which remains high at 34 per cent even after accounting for worker fixed effects and controlling for the individual and job characteristics available in the data. We also show that TES workers are much less likely to report benefit contributions than non-TES workers, and when they do, their contributions as a percentage of the gross wage are on average much lower than among non-TES workers. These results add substance to the arguments that TES workers are in a more precarious position than non-TES workers, and that this form of employment contributes to high levels of labour market inequality in South Africa.

Women in the gig economy: feminising ‘digital labour’

This article explores the gendered dynamics of labouring on digital labour platforms and gives voice to women gig workers. Millions of women worldwide find work through digital labour platforms, yet remain largely invisible within the expansive digital labour research agenda. The analysis is built from original interviews with 49 women in the UK using a range of popular remote crowdwork platforms (including PeoplePerHour, Upwork, TaskRabbit, Freelancer) to access desk-based, white-collar gig work from home. The article makes three original contributions. First, it widens the analytical focus of the digital labour research agenda to recognise the role of workers’ gender identities and uneven household gender divisions of care in shaping the operation and outcomes of digital labour platforms, in ways that remain ‘hidden in the cloud’. Second, in contrast to widespread celebratory claims that platforms disrupt stubborn gender labour market inequalities, the analysis identifies significant gendered constraints on women’s algorithmic visibilities and abilities to compete for gig work online, alongside multiple health and safety issues among women gig workers undocumented in previous research. Third, in response to these new insights, and based on calls from women gig workers themselves, it sets out a series of new directions for extending this urgent multidisciplinary research agenda.

Between Frustration and Invigoration: Women Talking about Digital Technology at Work

This study addresses the dearth of gender analysis within debates about technological innovation and workplace change. Qualitative analysis of 12 focus groups conducted with women in ‘frontline’ and ‘professional’ roles discussing their use and engagement with digital technologies at work reveals contrasting narratives of ‘digital frustration’ and ‘digital invigoration’. To explain these distinct narratives, we synthesise insights from science and technology studies with findings from scholarship on gendered work and labour market inequality to show that these differences are not driven solely by a technology’s form or the degree of automation it ostensibly represents. Instead, women’s narratives reflect an interplay between technological design, employment context and workers’ own voice and agency. These findings challenge assumptions about the totalising and transformative power of work-related technologies, redirecting attention to how social and political contestations over digital technologies inform worker experiences and shape the future of work.

Unemployment in Rural Europe: A Machine Learning Perspective

This paper aims to provide policy-relevant findings that can contribute to the resilience of rural regions by discovering the main individual-level factors related to unemployment in those areas through the use of a set of machine learning techniques. Unemployment status is predicted using tree-based classification models: namely, classification tree, bootstrap aggregation, random forest, gradient boosting, and stochastic gradient boosting. The results are further analyzed using inferential techniques such as SHAP value analysis. Results suggest that access to training programmes can mitigate the labor market inequalities caused by differences in education levels, gender, age, alongside with parental education levels. The results also show how such inequalities are even larger for various subgroups detected by the employed algorithms.

Widening double dualisation? Labour market inequalities and national social policy responses in Western Europe during the first wave of the COVID-19 pandemic.

Europe is witnessing a ‘double dualisation’ process, whereby inequalities have increased both between labour market insiders and outsiders, and between core and peripheral countries. We test the double dualisation hypothesis in the context of the first wave of the COVID‐19 pandemic. Did the COVID crisis exacerbate income inequalities between insiders and outsiders? Did cross‐country territorial divides also increase? Did national governments' emergency measures contribute to containing or widening double dualisation? We deploy a multi‐method research design that combines original survey data on seven old EU member states with three case studies on Germany, Italy, and the Netherlands. Results show that, in the short term, the COVID‐19 pandemic has been a catalyst of double dualisation: outsiders bore the greatest burden, especially in southern European countries. National emergency measures largely depended on the fiscal leeway available to governments and followed pre‐existing welfare trajectories, thus worsening cross‐country inequalities, with potentially severe consequences for the European integration process.

Inequality, Redistribution and Wage Progression

Changes in the structure of work and families over the last four decades have increased many labour market inequalities. Growing earnings inequality, adverse labour market ‘shocks’ for the low‐educated, and geographically concentrated pockets of deprivation are among the most evident of these in Britain. The decade since the financial crisis has brought these inequalities into sharper focus, and the Covid‐19 pandemic has further exacerbated labour market inequality. The object of this paper is to highlight the key role played by poor wage progression for lower‐ and middle‐educated workers in understanding inequality in the labour market and for designing effective policy responses. It is unlikely that we can address all the concerns about low wages, wage progression and earnings inequality through the tax and welfare system alone. The challenge is how best to balance tax and welfare benefit policy with other policies, such as human capital policies, the minimum wage and labour market regulation. The results point to a mix of policies that aim to enhance wage progression for the lower‐educated within a welfare system that supports low‐earning families and provides a minimum wage floor for hourly wages.

Bringing the market in: an expanded framework for understanding popular responses to economic inequality

Abstract There has been an upsurge in research on the politics of economic inequality in the 21st century. Discussions of popular responses to rising inequality have expanded in turn yet remain centered on support for explicit government redistribution of income from the rich to the poor. We argue that this focus may downwardly bias measurement of preferences for less inequality and propose an expanded framework that incorporates preferences regarding market institutions and policies that reduce labor market inequalities, which together can shed light on the public’s adherence to free market ideology. Empirically, we use original data to examine the US case, with a comparison to Sweden and Denmark. The results offer initial evidence of (1) the need for an expanded framework and research agenda in this field and (2) potentially broad-based support for policies that address economic inequality directly in the market sphere, contrary to key tenets of free market ideology.