Local Labor Research Articles

The spatial dimension of ageing and growth in European regions

AbstractThis study aims to tackle the potential effects of population ageing on regional growth dynamics in the EU. We collected information at a NUTS2 level for EU countries from the years 2000 to 2020 to understand the extent to which the ageing of EU society might impact the EU convergence process. Our results emphasize that the ageing of EU society does not seem to harm the possibility of regional economic growth if we think that immigrants can fill openings in local labour markets (left by retired persons), as well as new jobs stemming from new services needed by retired persons (mostly in health and daily care). Our outcomes also stress the relevance of considering the spatial dimension of the analysis to detect the place-based dimension of this dynamic and, hence, the need for tailored policies.

Precarity and agency in youthspaces of work: The case of food delivery platform workers in Athens, Greece

The growth of digital platforms is spawning new, if often precarious, forms of work. One such type of work that has particularly grown in recent years, especially during the COVID-19 pandemic, is that of digital platform-facilitated on-demand food delivery services. Such deliveries are often undertaken by younger workers. Given this, here we explore the following research questions: (i) what forms of labour precarity are found and reproduced in the physical and digital spaces that young food delivery platform (FDP) workers create and inhabit?; and (ii) what types of agency do FDP workers develop within these spaces in order to navigate – and sometimes resist – precarity? Drawing upon concepts from critical Youth Studies, Geographical Political Economy and Labour Geography, the article develops the concept of precarious youthspaces of work to investigate the connections between youths’ everyday lives and the production of space. To do so we present a qualitative study conducted in Athens, Greece, that sought to capture the multifaceted working arrangements of FDP workers, both offline and online. Our analysis reveals that FDP workers suffer various forms of labour precarity which they must navigate. But such workers are not just accommodating to precarity. They have also generated forms of collective oppositional agency that are reshaping local labour markets. However, whilst their agency has sometimes generated solidarity and robust collective movements it has also led to divisions that have limited cooperation amongst FDP workers.

Echoes of insecurity: The detrimental effect of crime on corporate employment

AbstractThis study investigates the influence of local crime on corporate employment in China. Leveraging a comprehensive data set of 85 million court judicial documents, we construct city‐level crime measures. We find that local crime is negatively associated with corporate employment. Using China's Gang Crime Crackdown program as a quasi‐natural experiment and the difference‐in‐differences approach, we further identify the causal relationship. Violent crimes and those with longer sentences drive the negative correlation between local crime and corporate employment. This relation is particularly pronounced among low‐skilled employees, in cities with inadequate commuter security, and in financially constrained firms. Our findings emphasize the role of a secure social environment in the local labor market and firms' employment decisions.

The role of migration-innovation nexus for population aging

AbstractImmigration can potentially address demographic challenges in developed countries by introducing young workers into the labor markets but, at the same time, it can increase competition for jobs with socio-economic effects that need to be carefully managed. Prior research has focused on the impact of immigration on local labor markets taking into account the skills of native-born inhabitants and immigrants. In contrast, analyses of age-specific effects are scarce despite the fact that immigration is likely to affect workers in different age-cohorts to different extents, with various policy implications. In addition, firms’ innovative capacity may contribute to shaping the effects of immigration. This work contributes to the existing literature by examining the relationships between immigration, labor market dynamics, and innovation in Western Europe between 2011 and 2019. The analysis uses microdata drawn from the Labour Force Surveys, from the OECD REGPAT database, and from the European Social Survey. The results show that immigrants are more likely to substitute younger native workers, while adult workers benefit from immigrants employed in complementary tasks. This substitution/complementarity nexus increases in the more innovative sectors. From a policy standpoint, these findings highlight the need for age-specific policies and training programs in order to mitigate the adverse effects of immigration and to maximize growth-promotion.

Suicide variations between English neighbourhoods over 2017-21: The role of spatial scale

Geographic studies of suicide variation typically focus on predictors at the same level as the event rates, and the possible interplay between different spatial scales does not generally figure. In this paper we focus on suicide variations between 6856 small area census units in England, but against a background provided by nine regions, broad urban-rural categories, and 155 local labour markets. Suicide death totals vary considerably between the small areas, with more areas than expected having no deaths, so we apply zero inflated regression. With this framework, we consider the relative contribution of factors at higher and lower spatial scales in explaining small area suicide contrasts, and why some areas have unduly elevated or unduly low suicide rates. We find significantly lower suicide levels in English metropolitan regions, after allowing for neighbourhood influences, but considerable heterogeneity in risks within broader spatial units. Varying incidence in general is associated significantly with all observed neighbourhood risk factors (social fragmentation, socioeconomic status, mental ill-health, ethnic mix), but low fragmentation and low psychiatric morbidity are the only significant influences on unduly low incidence.

Implementation of the Village Revenue and Expenditure Budget on Development in Bajur Village, Labuapi Sub-District, West Lombok District 2020-2023

This study aims to determine the implementation of the Village Budget (APBDes) on development in Bajur Village, Labuapi District, West Lombok Regency in 2020-2023. This research is qualitative research. The subjects of this research were the government and the community in Bajur Village. Data collection techniques in this study were carried out by means of observation, interviews, documentation, and literature study. To ensure data validity, the author used triangulation including method triangulation, inter-researcher triangulation, data source triangulation, and theory triangulation. Data were analyzed using the Miles and Huberman model, namely data collection, data reduction, data presentation, and conclusion drawing. The results showed that the implementation of the Village Revenue and Expenditure Budget (APBDes) for development in Bajur Village, Labuapi District, West Lombok Regency in 2020-2023 showed compliance with applicable regulations and provisions. Bajur Village has implemented the APBDes properly and accountably. This can be seen from several aspects, namely: (1) APBDes planning is carried out in a participatory manner by involving the community through deliberations at the dusun and village levels, (2) APBDes implementation is carried out based on the RKPDes and APBDes that have been approved. The village empowers the community in the implementation of village programs and activities, and uses local labor, (3) APBDes administration is carried out carefully, thoroughly, and consistently. The village uses the Siskeudes application to assist in recording, classifying, and reporting village financial transactions, (4) APBDes reporting is submitted in stages and accountable to interested parties, both the government above and the village community, (5) APBDes accountability is submitted to various related parties through the submission of APBDes realization reports and information media.

A human resources and legal risk management framework for labour disputes in the petroleum industry

The petroleum industry is vital to many economies but is often plagued by labor disputes that can disrupt operations and affect profitability. This paper proposes a comprehensive Human Resources and Legal Risk Management Framework specifically tailored for managing labor disputes in the petroleum sector. The framework integrates human resource management practices with legal compliance measures to minimize risks associated with employee relations and disputes. The framework emphasizes proactive measures, including effective communication, employee engagement, and training programs designed to foster a collaborative workplace culture. By implementing conflict resolution strategies and grievance handling procedures, organizations can address issues before they escalate into disputes. Additionally, the framework underscores the importance of adhering to labor laws and regulations to mitigate legal risks. Key components of the framework include risk assessment tools that identify potential areas of conflict, alongside mechanisms for monitoring labor relations. By leveraging data analytics, organizations can better understand employee sentiment and predict possible disputes, allowing for timely interventions. Furthermore, the framework advocates for establishing a clear legal compliance structure, ensuring that all practices align with local and international labor laws. The integration of human resources and legal considerations not only enhances organizational resilience but also fosters a positive workplace environment. It is crucial for organizations in the petroleum industry to recognize the interdependence of HR practices and legal obligations, as failure to address labor disputes effectively can lead to significant financial losses and reputational damage. In conclusion, this framework offers a structured approach to managing labor disputes, promoting organizational sustainability in the petroleum sector. By aligning human resource strategies with legal risk management, companies can create a harmonious work environment that ultimately contributes to their long-term success.

Local party committee and labor cost asymmetry

AbstractChinese state-owned enterprises (SOEs) operate under seemingly incompatible logics of economic and noneconomic objectives and thus within a setting of institutional complexity. This complexity manifests in the coexistence of the modern enterprise system and a firm-level Local Party Committee (LPC). LPCs check proposals from a political standpoint before executives decide on economic feasibility. We provide evidence that SOEs with more LPC participation exhibit greater labor stickiness, and this association is more pronounced after the enactment of the Labor Contract Law in 2008, when LPCs became more focused on noneconomic objectives. Additional analyses reveal that regional differences in market-based institutional quality moderate the association between LPC participation and labor cost asymmetry. Our results are relevant for emerging market investors who attempt to incorporate cost asymmetry into their profitability forecasts and for other stakeholders who strive to understand and anticipate the impact of the complex Chinese institutional setting on cost behavior.

Local Agglomeration and Household Mortgage Debt

Using detailed household data, we find that households working in locally agglomerated economies have high mortgage loans and are more likely to have mortgage loans. Channel testing shows that local agglomeration increases housing and mortgage demand as well as mortgage supply. The increase in mortgage loans is driven by purchases of larger houses and smaller down payments. Mechanism analyses document that local agglomeration affects mortgage loans by increasing career upward potential and providing downside protection. Specifically, we find that the impact of local agglomeration is stronger for skilled employees with enhanced prospects. In addition, local agglomeration weakens the negative relation between unemployment and mortgage loans, which supports the downside-protection role of local agglomeration. These results hold under instrumental variables analysis, difference-in-difference analysis, and a set of robustness checks. Overall, our findings highlight the importance of local labor market composition in household mortgage debt. This paper was accepted by Kay Giesecke, finance. Funding: F. F. Chen acknowledges the financial support provided by the Fundamental Research Funds for the Central Universities; the MOE Project of Key Research Institute of Humanities and Social Science in University [Grant 22JJD790094]; and the 111 Project [Grant B18033]. Supplemental Material: The data files are available at https://doi.org/10.1287/mnsc.2022.03486 .

Local labor market and corporate investment

To capture local labor market pooling in agglomeration economics, we employ segment information and occupation statistics to construct firm-pair labor force similarities. Our findings indicate a positive relation between local labor market thickness and corporate investment, influenced by both employer-driven labor demand and employee-driven labor supply. The findings are more pronounced in firms with more skilled labor, less routine-task labor, and higher product and technology competitions. Firms in thicker local labor markets also display higher investment efficiency, higher operating efficiency, and higher valuation. To mitigate the endogeneity concern, we employ an instrumental variable approach to show robustness. Overall, we uncover a specific linkage between the local labor market and corporate investment.

Schooling for integration? Reception of refugees in discourse and practice in Swedish rural municipalities 2015–2022

This study explores the integration of migrants in education and the labour market from the perspectives of professionals working with young migrants in Swedish rural municipalities. It compares interview data referring to the situation during the refugee crisis in 2015 with data referring to the period 2019–2022. It addresses the organisation of teaching, how professionals talked about integration in relation to the local labour market and how integration-related practices and discourses developed from 2015 to 2022. The findings indicate a major change over time in the educational integration strategies and practices. Migrant children were mainly taught in separate preparatory classes in 2015, but by 2019–2022 there was a general aim to integrate them rapidly in regular classes. In terms of labour market integration there was also a discursive change. In 2015 the main hope was that the migrants’ reception would create short- and long-term jobs for the local population and contribute to the survival of local services and life. In contrast, in 2019–2022 the main expressed hope was that migrants would stay permanently and contribute productively to their new societies’ labour forces.

Labour market impacts of the China shock: Why the tide of Globalisation did not lift all boats

The 1990s and 2000s saw a dramatic expansion in global goods trade. China rapidly emerged as the world's leading exporter while manufacturing employment in many high-income countries plummeted. Guided by textbook models that assumed frictionless labour markets and balanced trade, economists long maintained the view that trade had only modest labour market impacts and was not an important contributor to rising inequalities in high-income countries. We review recent evidence on the impacts of rapidly rising import competition from China on a broad range of outcomes in high-income countries. Import competition led to employment and wage losses that were heavily concentrated among the employees of exposed industries and individuals residing in local labour markets where such industries clustered, while consumer gains from lower goods prices were much more evenly distributed in the population. The disruptive effects of trade were particularly salient in countries such as the United States and the United Kingdom where a rapid growth of imports did not coincide with a commensurate expansion of own exports. Local labour markets facing greater import competition also experienced deteriorations in terms of health outcomes, crime, and family structures, and they became more likely to support far right politicians. We discuss several policy options to support the losers from globalisation.

Local labor match and corporate investments: Evidence from new flight routes

Local labor match and corporate investments: Evidence from new flight routes

Market power and wages: evidence from Brazil

PurposeThe paper examines the impact of market power on wages within the context of a developing country, focusing on Brazil.Design/methodology/approachWith access to matched employer–employee data from Brazil, we first characterized the evolution of the local labor market concentration (Municipality Herfindahl–Hirschman Index [HHI]). Then, we built a fixed-effect model with instrumental variables to verify the association between the local labor market concentration and wages. Finally, a difference-in-difference (DiD) was implemented to verify whether a merger transaction impacted the workers’ earnings in the Brazilian banking sector.FindingsThe paper’s findings suggest that there may be a negative relationship between market power and workers’ earnings.Originality/valueThis research conducted an in-depth investigation of the labor market power in a developing country. As far as we know, our work is the first to evaluate the extension of local concentration in Brazilian formal labor markets and to illustrate its evolution over the last decades. Additionally, when going through the effects of market concentration on wages, we use a new identification strategy that explores changes in the HHI that are caused by national trends in an industry as a source of exogenous variation. Finally, the last part of the paper assesses the effects of antitrust policy on the labor market, a kind of investigation that is still scarce.

The effects of foreign direct investment on human capital accumulation—Evidence from China

AbstractThis paper examines the effect of foreign direct investment (FDI) on human capital accumulation in China. The identification strategy exploits variations in FDI inflows across manufacturing sub‐sectors caused by China's FDI liberalisation and initial sectoral composition patterns across cities. Using a panel of city‐level data from 1990 to 2005, the paper shows that FDI liberalisation accelerated human capital accumulation. Cities with higher exposure to FDI liberalisation experienced higher growth in high school and college enrollment. FDI incentivizes individuals' investment in their human capital by paying a higher wage premium for skilled workers, pushing up the skill premium in the local labor market, and raising household income. Compared to export‐oriented FDI and FDI in less‐skilled industries, market‐seeking FDI and skill‐intensive FDI have a much larger effect on college enrollment.

Navigating a double school-to-work transition: how do Chinese graduate students decide where to start their careers after studying abroad?

PurposeThis exploratory research aims to unravel how Chinese international students form their decisions regarding the school-to-work transition (sometimes also referred to as the university-to-work transition) when studying abroad.Design/methodology/approachThe authors use the concepts of school-to-work transition and cultural approaches to investigate how Chinese graduate students make career decisions to navigate the school-to-work transition in the context of international mobility. The authors' empirical study is based on 30 semi-structured interviews conducted with Chinese graduate students studying in the Netherlands.FindingsThe authors discovered four patterns with two major subgroups among Chinese students studying in the universities in the Netherlands based on their initial intentions: return-return, open-return, open-stay and stay-stay. These patterns made sense when navigating the school-to-work transition: participants experienced varied international experiences, cultural perceptions and acknowledgment influences when enhancing employability and shaping their career decisions. Participants in the return-return and stay-stay groups indicated strong resilience and consistency in achieving their goals and strongly focused on long-term objectives. However, participants' open-return decision demonstrated a thoughtful alignment of personal goals and knowledge of the possible beneficial influence they may have in their home country. Open-stay participants utilized the overseas study opportunity to finalize their decisions and increase their employability in the local labor market, thereby creating a transition from university to work in the host country.Originality/valueThe authors highlight the way Chinese graduate students manage their international experience and provide novel insights into the role played by the cultural characteristics of their home country and host country.

Handling Out‐of‐Sample Areas to Estimate the Unemployment Rate at Local Labour Market Areas in Italy

SummaryUnemployment rate estimates for small areas are used to efficiently support the distribution of services and the allocation of resources, grants and funding. A Fay–Herriot type model is the most used tool to obtain these estimates. Under this approach out‐of‐sample areas require some synthetic estimates. As the geographical context is extremely important for analysing local economies, in this paper, we allow for area random effects to be spatially correlated. The spatial model parameters are estimated by a marginal likelihood method and are used to predict in‐sample as well as out‐of‐sample areas. Extensive simulation experiments are used to assess the impact of the auto‐regression parameter and of the rate of out‐of‐sample areas on the performance of this approach. The paper concludes with an illustrative application on real data from the Italian Labour Force Survey in which the estimation of the unemployment rate in each Local Labour Market Area is addressed.

Empirical Monte Carlo evidence on estimation of timing-of-events models

This article builds on the Empirical Monte Carlo simulation approach to study the estimation of Timing-of-Events (ToE) models. We exploit rich Swedish data of unemployed job seekers with information on participation in a training program to simulate placebo treatment durations. We first use these simulations to examine which covariates are key confounders to be included in dynamic selection models for training participation. The joint inclusion of specific short-term employment history indicators (notably, the share of time spent in employment), together with baseline socio-economic characteristics, regional and inflow timing information, is important to deal with selection bias. Next, we omit subsets of explanatory variables and estimate ToE models with discrete distributions for the ensuing systematic unobserved heterogeneity. In many cases, the ToE approach provides accurate effect estimates, especially if time-varying variation in the unemployment rate of the local labor market is taken into account. However, assuming too many or too few support points for unobserved heterogeneity may lead to large biases. Information criteria, in particular those penalizing parameter abundance, are useful to select the number of support points. A comparison with other duration models shows that a Stratified Cox model performs well with abundant multiple spells but less well when multiple spells are uncommon. The standard Cox regression model performs poorly in all configurations as it is unable to account for unobserved heterogeneity.

COVID-19 School Closures Were Associated With A Decline In Employment For Female Nurses With Young Children.

COVID-19-related school closures may have had unintended consequences affecting the ability of health professionals with school-age children to work-particularly female professionals, who often have disproportionate child care responsibilities. We combined labor-force participation data from the Current Population Survey with measures of school closures based on cell phone mobility data to examine the association between local school closures and labor supply among female nurses during the COVID-19 pandemic. During the six months after large-scale closure of schools at the end of the 2019-20 school year (March-August2020), among counties with above-median school closure rates, the employment rate of female nurses with young children declined by 12.5percentage points versus the rate during the prior four months (November2019-February2020); the change in the employment rate in below-median counties was not statistically significant. No statistically significant changes were observed among female nurses who had only older children or among male nurses. During public health emergencies, policies should consider how disruptions to schooling may affect the labor supply of health care professionals. Strategies might include direct provision of child care by health care facilities, subsidies and other aid to child care centers, or subsidies to health care workers for affordable child care.

The formation of the tourism labour market in Spain, 1955–1973

AbstractThis paper studies the process of labour market formation in the tourism industry in Spain. Results show that tourism regions diverged in their capacity to attract local labour, a factor that led to different compositions of the workforce. In the most dynamic regions, circular migration became a key factor as a result of housing shortages, seasonality and labour policy. Tourism agents promoted these flows by different mechanisms such as recruitment at origin and temporary accommodation. Migration benefited growth of firms, natives' upward mobility and migrants' accumulation of capital. However, inequality in the regional labour market and host society increased.