Lower Labor Force Participation Rates Research Articles

A Regional Labour Market Profile

As unacceptably high unemployment levels persist throughout the OECD so greater attention is being paid to differences in the way regional Labour markets adjust to growth and recession. Comparatively speaking New Zealand has lacked both the conceptual and empirical analyses necessary to build local and regional specific approaches into its active labour market policies - despite the persistence of regional disparities through the post war period. When regional differences are raised for public discussion in New Zealand it is the geographical variations in the unemployment rate that usually receives attention. What this paper shows is that unemployment is merely the surface phenomenon of a condition which is much more deeply embedded in the regional labour markets affected. This is illustrated by constructing a regional labour market profile which measures each of the 14 regions on four separate labour market indicators. When applied at the height of the New Zealand recession in 1991 the profile demonstrated how regions with high unemployment rates not only experience Low labour force participation rates but that when members of the labour force in such regions do find work they work fewer hours and even when fulltime employment is obtained the levels of remuneration are lower than those in the more buoyant regions. The result of these interconnected characteristics of regional labour markets is a series of indirect multipliers which serve to exaggerate and compound the effect of depressed labour demand on weaker markets.

Rising Skill Levels and Declining Labor Force Status Among African American Males

Steadily rising levels of educational attainment typify young African Americans in recent decades. Also typical among this group, particularly among males, is the rising incidence of subpoverty-level earnings and higher nonparticipation in the labor force. This article presents and analyzes data showing that downwardly mobile White workers are increasingly displacing bluecollar Black workers in ways reminiscent of the Great Depression, and that those Blacks who remain employed in blue-collar fields often face reduced compensation and job security. It attributes the severe problems facing Black workers partly to their weaker position relative to Whites to defend themselves from modern-day employer practices and partly to broader economic changes affecting blue-collar workers of both races. BLACK-WHITE EARNINGS INEQUALITY Defenders of the severe earnings inequality that typifies the present U.S. labor market invariably cite the following 1960s-style generalizations to justify the status quo: (a) the meritocracy argument and (b) the employer attitudes argument. The first theory posits that labor market outcomes are solely determined by the abilities of workers and potential workers. Thus, the better-qualified applicant gets the job; the more productive employee receives higher compensation than the less productive one; and advancement opportunities accrue to the most highly qualified workers. Additionally, because ability determines outcomes in a meritocracy, acquiring more education and skills are pragmatic strategies for those who desire to compete successfully in the labor market. There is a large and indisputable element of truth to the meritocracy argument. However, critics point out that this hypothesis ignores important realities about the labor process in the United States. Particularly when simplistic meritocracy arguments are put forth to justify the lower earnings, higher unemployment rates, and lower labor force participation rates of African Americans as opposed to White Americans, critics rightly claim that discrimination skews labor market outcomes in ways that are disadvantageous to Black workers. Though employment discrimination takes many forms, the second argument captures the crux of the discriminatory processes historically operant in the U.S. labor market in its presumption that labor market opportunities are shaped by employer attitudes. Thus, an employer who believes that Blacks generally are less reliable workers than Whites will prefer to hire Whites when applicants appear to be equal in every respect other than race. Such an employer may hire Black workers if (a) a suitable supply of White applicants is unavailable or (b) Blacks can be hired at lower wages than similarly qualified Whites. Given such discriminatory employer attitudes, African Americans tend to suffer from restricted job access and lower wages more often than similarly qualified White workers. These two generalizations are not mutually exclusive. Employer attitudes must be altered before the meritocracy arguments put forth in the first generalization can be accepted as valid. Alternately, variations of the second generalization implicate Whites who refuse to work side by side with Blacks, or White consumers who refuse to shop in environs where Black employees are numerous, as further causes of discriminatory labor market outcomes. According to both variants, however, the culprit responsible for maintaining Black disadvantage in the labor market is the same: White attitudes. Progressive labor market policies popularized in the 1960s were an amalgam of the generalities noted above. Black-White labor market inequalities, it was then assumed, would best be fought by (a) upgrading education and skill levels, particularly among young African Americans; and (b) putting legal pressure on employers to abandon their discriminatory attitudes. Despite the failure of these strategies to ameliorate these disparities, 1960s-era generalizations about employee productivity and employer attitudes still provide important insights into the causes of earnings differentials. …

Geographical and Gender Differences in Labor Force Participation: Is there an Appalachian Effect?

ABSTRACT. A recent article in this journal concluded that West Virginia's low labor force participation rates cannot be attributed to economic, demographic, or institutional factors and that they probably result from an Appalachian culture which has a strong preference for non‐market activities. This article reviews the diverse social science literature on determinants of labor force participation and then takes a closer look at Appalachian participation. It presents and uses a more comprehensive model, focuses on the county level instead of the state, and examines variations within Appalachia and over time. The main findings are that the Appalachian labor force gap is either nonexistent or very small and that there is no statistical evidence of a unique or pervasive Appalachian cultural effect. Appalachian labor force behavior appears to be quite average given the conditions faced by Appalachians.

Benefits and the Labour Supply of Women Married to Unemployed Men

This paper seeks to explain the low labor force participation rates of women married to unemployed men in the reducing the net increment to household income that would result from the wife's employment. Simple probit models of the participation and part-time/full-time decisions are estimated using a large cross-sectional data set. The results confirm the importance of severe disincentive effects, controlling for labor market conditions. Income-related benefits are found to create worse problems than national insurance benefits; both types impede part-time work in particular. Copyright 1990 by Royal Economic Society.

The impact of Mexico's economic crisis on the demographic composition of the maquiladora labor force

This study focuses on the changes that have occurred since 1982 in the demographic composition of the maquiladora labor force. In the period 1983-1987, the number of obreros employed by the industry has more than doubled, increasing to 262,000 (Table 1). The most important influence on labor demand during this period was the sharp decline in the maquiladora firms' dollar-denominated wage bills. This decline was brought about by the progressive depreciation of the peso in combination with a conservative government wage policy. Labor supply behavior since 1982 has been more problematic; government-determined increases in the benchmark minimum wage have lagged well behind the inflation rate. As a result, the real purchasing power of peso wages is estimated to have fallen 40 percent since 1982. Despite the reduction in real wages, the supply of labor to the maquiladora industry has expanded to accommodate the near-explosive growth of labor demand. In this article we argue and present evidence that maquiladoras, constrained to honor the minimum wage as both a wage floor and wage ceiling, have influenced the elasticity of the labor supply curves they face by broadening hiring criteria and by seeking locations in the interior of Mexico where there are higher levels of unemployment and lower labor force participation rates (LFPR). Further, we advance the proposition that falling real family incomes have influenced border labor supply by stimulating the flow of job seekers to the border area where jobs are plentiful and by encouraging higher LFPRs. Finally, the results of the two post-1982 surveys of maquiladora workers in Cd. Juarez are presented. The surveys provide microlevel insights into how rapid industrial expansion in an environment of general recession has influenced industry employment policies and the characteristics of the maquiladora workforce.

Arthritis and the earnings of men: An analysis incorporating selection bias

Arthritis is a chronic and crippling disease which affects the work effort and earnings of more than 14 million working-age victims. This paper examines the effects of arthritis on the earnings of men aged 18 to 64. Arthritis has large and significant effects on earnings. Most models incorporating selection bias have examined groups with lower labor force participation rates than prime-age males, but significant selection bias is found here. When selection bias is considered, the estimated absolute effects of arthritis are increased and the percentage of the gap between arthritic and non-arthritic males explained by arthritis, as opposed to other factors, increases. This study is unusual in identifying the effects of a single disease on earnings.

Asian Labor Migration to the Middle East

There are currently between two and three million Asian workers in the Middle East, a tenfold increase in fewer than ten years. Pakistan and India each have about 800,000 workers in the Middle East (Demery, 1983). The increase in labor migration from Asia to the Middle East accompanied a rapid expansion in the economic and social development plans of the oil-exporting countries in the Middle East subsequent to the 1973 oil embargo. The indigenous labor forces in the oil-exporting countries were relatively small and lacked the necessary technical skills to carry out these ambitious development plans (Minocha et al, 1983). Labor shortages were exacerbated by an aversion to manual labor on the part of workers in the oil-producing countries and by low labor force participation rates for women (Birks and Sinclair, 1979). To fill this gap, foreign workers were originally brought in from other countries in the Middle Eastern region. When the supply of qualified, cost-effective Arab workers became tight, however, the oil-ex? porting countries began to diversify their sources of labor, first drawing on workers from South Asia and more recently expanding their horizons to East and Southeast Asia. The major labor-exporting countries in Asia are, in general, highly favorable toward labor migration and they have taken steps to facilitate the flow of workers to the Middle East. Many of these countries have come to rely heavily on remittances from the Middle East (currently totaling about $6 bil? lion annually) for precious foreign exchange. Labor migration has also been viewed as providing a safety valve for widespread unemployment and underemployment in the sending countries. Only recently have some of the

The Impact of "Sun Belt Industrialization" on Chicanas

Historically, Mexican American women have had lower labor force participation rates than Anglo or black women. In 1960, only 24.4 percent of Chicanas were employed as compared to 34.5 percent of Anglo women.1 Explanations of these disparities in labor force participation rates have relied on a model of cultural determinism that identified cultural values and norms as the causal factors. Many authors assume that family values alone determine whether Chicanas will enter the labor market, and that Chicanas violate those values when they work outside the home. I call this the familism or explanation. According to this model, Chicano machos prefer that their wives not work, and Chicanas, who value their homemaker roles over taking jobs, thus submit to their husbands' wishes. A corollary notion is that acculturation will occur when Chicanas are gainfully employed and that, consequently, they will lose family values.2 Over the last two decades, however, Chicanas have rapidly entered the labor force. Between 1960 and 1970, for example, married Chicanas entered the labor force nationally at a rate 15 percent higher than their white and black counterparts.3 In 1970, the gap in labor force participation rates had narrowed; 43 percent of all women worked as compared to 36 percent of Chicanas. By 1980, the gap between Chicanas and other women workers had nearly disappeared: 52 percent of all women worked,.while 49 percent of Spanish-origin women were employed.4 At the same time, Chicanas consistently have had higher unemployment rates than Anglo women. In 1970, women of Mexican origin had an unemployment rate of 14 percent compared to 9 percent for all women. By 1980, their percentage of unemployed declined to 10, while that of Anglo women was 8 percent.5 Technically, the unemployed are persons who are actively seeking jobs and are available for work. The official unemployment rate, of course, does not include the many workers-those who have completely given up the search for work. Groups with high unemployment rates usually also have higher numbers of discouraged workers.6 The historically high Chicana unemployment rates, whether official or not, indicate that more Chicanas would work if they could find jobs. In addition, since Chicanas tend to have larger families than Anglo women, the availability of child care facilities may have a greater influence on their ability to remain in the work force. The traditionalist approach neither predicted nor explained these trends. Instead of challenging the traditionalist perspective, adherents of the model merely modified it and claimed that declining family values explain Chicanas' recent entrance into the labor force. Most cultural determinants do not actually examine Chicanas' values and beliefs. A recent empirical study, however, investigated the effect of values on Chicana and Anglo women's labor force participation. Vilma Ortiz and her colleagues found that the cultural argument was not supported; traditional sex-role attitudes did not have a stronger impact on the labor force behavior of Hispanic females.7 In addition, these researchers found that the significant factor influencing Chicanas' commitment to the labor force was women's prior work experience. Women with unskilled, low-paying jobs tend to prefer homemaking, while those who have more stable jobs want to continue working. Ortiz argues that the availability of jobs, not culture, determines whether or not Chicanas are committed to the labor force. 8

The Upsurge of Women's Activism in India

The visit of Prime Minister Indira Gandhi to the United States in 1982 may have raised questions among American feminists about the situation of Indian women. Mrs. Gandhi's skill in handling the American media projects a powerful image of Indian women. Aggregate statistics convey an entirely different picture. Indicators of the precarious situation of the masses of Indian women include a low literacy rate (25 percent compared to 47 percent for men), a low labor force participation rate, high unemployment and underemployment levels, and a shorter life expectancy for women than for men.1 Moreover, Indian women are an extremely heterogeneous group. Numbering over 330 million, they are stratified by caste and class and further divided by urban or rural residence, regional cultures and languages, religion, age, and position in the family. Patriarchal domination has a long history in India, and its manifestations vary across caste, class, and region. In response women have evolved a variety of coping strategies, and some women have struggled actively against their oppression. Much of the history of these struggles has been lost, but today women's activism is increasingly visible. So far this activism has touched the lives of only a tiny fraction of Indian women, but the potential for growth is there. Four strands of activism have emerged over the past decade. Among the urban middle class there are feminists engaged in research and action. Among the lower class there are grassroots organizations of tribal women, militant women union members, and self-help associations of women in the informal sector of the economy (petty production, trading, service activities, and contract labor). There are some connections among these different strands of activism and between each strand and more established institutions such as left political parties and their associated unions, elite women's organizations, and the press. The established institutions (which are maleand/or elite-dominated) seek to use women's activism for their own ends but also offer organizational resources needed to reach a large number of women. The situation is further complicated because the women activists themselves have varying commitments to reform or revolution and to party-controlled or autonomous women's groups. In this paper I will try to convey a sense of women's activism in India today. First I will sketch briefly the historical and social context that has shaped the activism of Indian women. Then I will describe the issues on which each activist strand focuses, the strategies they advocate, and the impact of their efforts. Finally I will assess the obstacles to a weaving together of the activist strands. This paper is intended as a modest contribution toward crosscultural and cross-national understanding among white American feminists. Too often we have been insensitive to the factors that divide us as women (race, class, imperialism) and unaware of the struggles of our sisters in other cultures. A genuine international sisterhood can be built only on the basis of mutual understanding.