Low-wage Workers Research Articles

Cultures of Inequality: Labor, Social Finance, and the Swinging Pendulum of Trust in Capitalism

Social finance, an arena of international finance comprising social banking, impact investing, and microfinance, offers a powerful conceptual lens through which to interrogate the interface of finance and labor in financial capitalism. This article investigates social finance’s development at the crossroad of two processes. Social finance emerged in the context of a process of laboring finance, an often-coercive inclusion of workers and households into financial circuits of accumulation and expansion made possible by labor market changes that began in the 1970s. The global financial crisis occasioned the growth of social finance, which, by means of financing labor, placed the reproductive needs of labor—the needs of society’s most disadvantaged agents, the poor, the homeless, the marginal, and unemployed workers—at the center of financial accumulation. By informing an oscillatory movement between laboring finance and financing labor, and, affectively, between trust and distrust, social finance primes and cultivates financial market participants’ belief in purported solutions to the social problems financial capitalism has contributed to create. As a critical investigation of the complex interface between finance and labor that animates social finance’s operations, this article aims to provide conceptual resources that can contribute to releasing labor’s social cooperation from finance’s hegemony.

Abstract WP253: Prevalence of Undiagnosed and Uncontrolled Hypertension Among Low-Wage Workers in North Carolina With Elevated Stroke Risk

Introduction: Compared to the rest of the United States, North Carolina has an elevated stroke mortality rate. Risk factors, including uncontrolled hypertension (HTN), associated with disparities in stroke outcomes are also prevalent in North Carolina. We sought to determine the prevalence of undiagnosed and uncontrolled HTN among a sample of low-wage workers with elevated stroke risk. Methods: Between February 2021 and June 2023, we partnered with 35 business to provide worksite-based health screenings to rural, low-wage workers. Demographic information and a brief medical history were collected. A physical assessment included automated blood pressure measurement. Risk of stroke was assessed using the CHA 2 DS 2 -VASc. Results: A total of 930 screened individuals (52.5% Black) are included in this report. Among the 488 Black participants screened, 29.1 percent (n=142) had a CHA 2 DS 2 -VASc score ≥2. In comparison, less than 20 percent (n=79, 17.9%) of the 442 White participants had an elevated stroke risk (Figure 1). Of the 221 participants with a CHA 2 DS 2 -VASc score ≥2, stage 1 HTN (systolic blood pressure (SBP) = 130-139) and stage 2 HTN (SBP ≥ 140) was found among 19.5 and 52 percent of participants, respectively. We identified previously undiagnosed HTN among 6.3 percent of Black participants and 15.2 percent of White participants. In addition, over 60 percent of participants (Black = 62.7%, White = 60.8%) had been previously diagnosed with HTN, but screening results indicated their HTN was not well controlled. Conclusions: The prevalence of elevated stroke risk was 11.2 percent greater among Black participants compared to White participants. Using a worksite-based approach to health screening, we found high rates of undiagnosed and uncontrolled HTN among both Black and White participants with elevated stroke risk. This novel approach to care delivery facilitates screening among individuals who may otherwise underutilize or avoid engagement with the healthcare system.

Labour market resilience will be tested in the near term

AbstractThis chapter presents the state of the world's labour markets. On account of stronger than expected GDP growth, unemployment continued to fall in line with rising employment and labour force participation. Mounting fragilities, such as slowing growth and rising sovereign debt will take a toll on unemployment and the jobs gap in 2024, both of which are set to slightly deteriorate through 2025. Moreover, persistent working poverty and informality continue to present major challenges for social justice that are unlikely to improve over the medium term.

Prevalence, trends, and inequality in noncommunicable diseases in Bangladesh: Evidence from Bangladesh Demographic and Health Surveys 2011 and 2017–2018

AbstractWe investigated the change of the prevalence of noncommunicable diseases (NCDs) in Bangladesh from 2011 to 2018 across different socioeconomic groups as well as the factors associated with the changes in prevalence. We used the two waves of the Bangladesh Demographic and Health Surveys conducted in 2011 and 2017–2018. Modified Poisson regression model was used to estimate the prevalence rate and ratio of NCDs and to test the association with different demographic and socioeconomic variables. The study found an upward trend of NCDs from 2011 to 2017 in which overweight and obesity, hypertension, and diabetes increased by 1.8, 1.5, and 1.1 times, respectively. In 2011, people from the richest households had 5.6 higher odds of being overweight compared to the poorest, which was reduced to 3.0 in 2017. However, the increment for overweight and hypertension was the highest among the poor and manual workers from 2011 to 2017. The age‐adjusted prevalence ratio of overweight increased 4.4 times for the poorest, compared to 1.7 times for the richest. For manual workers, overweight increased 3.8 times, whereas hypertension increased by 2.4 times. The pooled analysis revealed that participants from the richest households have the highest risk of NCDs, with 3.3 times for overweight, 2.3 times for diabetes, and 1.3 times for hypertension, compared to the poorest. However, the prevalence of NCDs is rising quickly among the low socioeconomic groups in Bangladesh, narrowing the gap with higher socioeconomic groups. Our findings call for immediate policy interventions and targeted programs to curb NCD escalation in Bangladesh.

Foreign Price Shocks and Inflation Targeting: Effects on Income and Inflation Inequality

ABSTRACT Foreign price shocks have significant effects on functional income distribution and on inflation inequality. By increasing prices in domestic currency that are linked to foreign prices, they increase the profit share in some sectors and reduce real wages, in particular of workers whose consumption basket is more sensitive to the price of certain goods (e.g., food prices for low-wage workers). We propose a new extension to the conflicting-claims inflation model by incorporating workers heterogeneity (in terms of nominal income and consumption patterns) in an open economy model following an inflation-targeting regime. Then, we investigate the impacts of foreign price shocks on income and inflation inequality by increasing the foreign inflation rate and analyze how monetary policy influences these outcomes. Our simulation results indicate that a positive foreign price shock increases the profit share and the within-workers inequality (in real terms), since low-wage workers are more affected by these shocks. Yet, such effects are mediated by the strength of the monetary policy's transmission channels (domestic economic activity or nominal exchange rate), indicating that the monetary authority response may exacerbate or attenuate these distributive effects.

The labor market impacts of employer consolidation: Evidence from Germany

We use detailed administrative data to study how acquisitions – specifically the acquisition of a plant by a firm with a similar plant in the same local labor market – affect workers. Using an event study framework with a control group of workers at unaffected plants, we find that acquisitions lead to employment losses for workers initially employed at the acquired firm, mainly associated with labor force withdrawals by older female workers. At the same time we find evidence of a rise in wages for workers initially employed at targets and at the acquiring firm who remain with the combined enterprise, concentrated among lower-wage workers. Our findings suggest that consolidations lead to a reduction in overall employment but a rise in rents per worker that lead to a pattern of losers and winners in the labor market.

Worker Beliefs About Outside Options

Abstract Standard labor market models assume that workers hold accurate beliefs about the external wage distribution, and hence their outside options with other employers. We test this assumption by comparing German workers’ beliefs about outside options with objective benchmarks. First, we find that workers wrongly anchor their beliefs about outside options on their current wage: workers that would experience a 10% wage change if switching to their outside option only expect a 1% change. Second, workers in low-paying firms underestimate wages elsewhere. Third, in response to information about the wages of similar workers, respondents correct their beliefs about their outside options and change their job search and wage negotiation intentions. Finally, we analyze the consequences of anchoring in a simple equilibrium model. In the model, anchored beliefs keep overly pessimistic workers stuck in low-wage jobs, which gives rise to monopsony power and labor market segmentation.

Disabling labour: race, disability and Indian indentured labour on Fijian sugar plantations, 1879–1920

ABSTRACT The establishment in the1830s of the Indian indentured labour system as a cheap labour source for British sugar plantations provoked criticism from parliamentarians, missionaries and labour advocates who considered indenture the reintroduction of slavery by another name. Like slavery, the indenture system bonded into labour non-white, poor and unfree workers, already subordinated within the British empire. Like slavery, the Indian indentured labour system was structurally disabling. The development of colonial racial typologies of the ideal labourer embedded race into notions of the able bodied worker. While being of a preferred racial type was a condition of fitness to work it also exposed labourers to the disabling circumstances of being unfree labour on sugar plantations. Indenture practised in Fiji from 1879 to 1917 reflects the disabling effects of racial and economic subordination even in the late indenture period when labour conditions had improved. The development of systematic government measures to select workers as fit for the regulation of plantation labour and the disabling impacts of injury, illness, sexual and mental trauma experienced on the plantation, qualify the notion that modern western ideas of disability emerge primarily from urban industrializing environments.

Reimagining the Deduction for Employee Compensation

U.S. businesses pay trillions of dollars in employee compensation, a substantial fraction of which is deductible for tax purposes. This deduction reduces the taxable income of businesses, ultimately lowering business tax burdens by hundreds of billions of dollars. With a few exceptions, the tax code confers the same deduction to a business for every dollar of employee compensation, regardless of whether that compensation goes to an employee earning millions or an employee earning minimum wage. This is consistent with a pure Haig-Simons income tax, under which any business expense incurred ought to be deductible dollar-for-dollar. But many, if not most, tax policy objectives are inconsistent with a pure income tax, and the U.S. tax code is accordingly replete with substantial deviations from a pure income tax. This Article considers what would happen if the deduction for employee compensation also deviated from a pure income tax. It finds that allowing employers larger deductions for compensation paid to low-wage workers would counteract persistent deficiencies in the U.S. labor market. A larger deduction for low-wage workers would incentivize businesses to both hire more low-wage workers and pay them more. This would decrease the number of workers earning paltry wages, reverse the decline in U.S. labor force participation, restrain the employer market power exerted in many local labor markets, and correct the negative externalities from low-wage work. As part of its analysis, this Article considers how a larger deduction for low-wage compensation might be funded, focusing on funding sources that synergize with a larger compensation deduction for low-wage workers—including higher business tax rates and smaller deductions for high-wage workers—and it details the tradeoffs associated with these different policy options. This Article also explains why behavioral frictions may make an employer-side subsidy a more effective labor market intervention than an employee-side subsidy, such as the earned income tax credit (EITC).

Dismissal of an employee based on the results of certification

The essence of the employment relationship involves the expectations of the employer to receive labor of a certain quality and in a certain quantity from an employee. In addition, social and technological progress gives the employer the right to expect from the employee the appropriate development of skills, abilities and business abilities. As one of the means of stimulating employees to improve their work, the certification mechanism (periodic, etc.) is used. The legislator has established certain features of the legal regulation of relations between the employee and the employer in the event of a discrepancy between the employee and the position held by him or the work performed by him due to insufficient qualifications, confirmed by the results of certification. The article deals with the problems associated with the occurrence of a situation when the certification commission, created by the employer to assess the business qualities of an employee, comes to the conclusion that he is inconsistent with the position held by him or the work assigned by him due to various circumstances of an objective or subjective nature. The Labor Code of the Russian Federation assumes that the certification of employees should be largely regulated by local regulations, taking into account the requirements formulated at the industry and departmental levels. At the same time, there are problems in legal regulation that do not depend on the actions of the employer or the industry management state body. One of these is the problem of exercising the right of the employer to dismiss the employee in connection with the negative results of the certification. The author of the article draws attention to the provision of the Labor Code that dismissal on the grounds provided for in paragraph 3 of part 1 of Article 81 of the Labor Code of the Russian Federation is allowed if it is impossible to transfer the employee with his written consent to another job available to the employer (as a vacant position or a job corresponding to the qualifications an employee, as well as a vacant lower position or a lower paid job) that an employee can perform taking into account his state of health.

Genetic algorithm based features selection for predicting the unemployment rate of India

The forecasting of employment is critical for policymakers to prevent large impacts on modern life. Many studies have been conducted to predict the unemployment rate using time series models and structural models using data from advanced economy countries, but only a few studies have used data from developing countries. In addition, the two economic theories which focus on short-term inverse relationships between “unemployment and inflation” or “unemployment and gross domestic product” as described by the Phillips curve and Okun’s law, fail to predict the unemployment in low/middle-income countries and advanced economies undergoing stress. In this study, we have chosen India’s labor market, to test the hypothesis described by the Philips curve and Okun’s law because India’s economy exhibits the characteristics of low/middle-income countries with the majority of the labor force employed in agricultural and low-paying seasonal jobs. Given that the unemployment rate depends on a wide number of social and political factors we employed genetic algorithms (GA) for feature selection. Based on our limited literature survey, there were no research studies employing genetic algorithms to explain India’s labor market data so we have chosen India’s macroeconomic data to test the effectiveness of the GA model for features selection. Our results show that, for the chosen period, the Philips curve relationship doesn’t hold well for the Indian labor market. In addition, feature selection using the GA suggested that economic growth, household consumption, government spending and coal imports are the best macroeconomic variables to explain variation in the Indian labor market.

Occupational pressures of frontline workers enforcing COVID-19 pandemic measures in Ontario and Quebec, Canada.

During the COVID-19 pandemic, low-wage public-facing frontline workers (FLWs), such as grocery store clerks, were required to monitor retail customers and enforce COVID-19 protocols. This analysis aimed to examine FLWs experiences of enforcing COVID-19 pandemic measures. Between September 2020 and March 2021, in Ontario and Quebec (Canada), we conducted in-depth interviews about customer-related work and health risks with FLWs who interacted with the public (n = 40) and their supervisors (n = 16). Using a lens of situational analysis, verbatim transcripts were coded according to recurring topics. We found that enforcing public health measures placed already-precarious workers in difficult occupational health circumstances. Enforcement of measures created additional workplace responsibilities, stress, and exposed them to potentially negative reactions from customers. Interventions to better support these workers and improved methods of protection are discussed.

Does increasing the minimum wage reduce poverty in developing countries?

Raising the minimum wage in developing countries could increase or decrease poverty, depending on labor market characteristics. Minimum wages target formal sector workers—a minority in most developing countries—many of whom do not live in poor households. Whether raising minimum wages reduces poverty depends not only on whether formal sector workers lose jobs as a result, but also on whether low-wage workers live in poor households, how widely minimum wages are enforced, how minimum wages affect informal workers, and whether social safety nets are in place.

Intersectional Earnings Inequalities in U.S. Public Sector Workplaces and the Great Recession

The authors examine intersectional earnings inequalities in U.S. state and local government workplaces during the Great Recession of 2007 to 2011. Corresponding to closure and exploitation mechanisms as proposed in Relational Inequality Theory, the authors decompose pay gaps into between-workplace and within-workplace segregation components and within-job disparities. Between-workplace closure mechanisms tend to be absent or weak for all comparisons, but within-workplace occupational closure and within-job pay disparities are present for all and quite large for most groups. Within-job earnings inequalities tend to be largest for Black, Hispanic, and Native American women and smallest for Asian and Native American men. During the Great Recession, organizational resources to make claims on shrank, as low-wage job layoffs surged and resources contracted. This resulted in a shrinking of within-workplace and within-job, but rising between-workplace, inequalities.

Innovating microcredit: how fintechs change the field

We explore the relationship between traditional microfinance screening variables and a new one (job experience) for a Brazilian fintech microcredit firm, which developed a strategy that targets poor workers using the clients’ job contracts as collateral and by implementing a 100% online application. A total of 911 contracts were analyzed. Unlike previous studies, we show that the main variable used for screening is job experience: borrowers with lengthy experience in their current jobs received larger loans with lower interest rates while maintaining smaller delinquencies. Additionally, we find that women receive lower interest rates and longer loan durations because of their job experience. We theorize that job experience helps to reduce the “collateral gap” between genders in Brazilian microcredit markets.

“WOULD YOU DATE A MAID?”

The refers to a common video trend we encountered as we set out to analyze how FDWs use TikTok to express personal and sexual sovereignty amid constraining structural surveillance at the level of policy, employer-employee dynamics, and social restrictions. Academic scholars from various disciplines have critiqued the nature of migration regimes in which foreign domestic workers (FDW) are hired, drawing from the fields of social, health, and economic justice. We focus on FDWs in Singapore, where these conditions are enforced and rationalized through laws and government-owned-media that entrench socially constructed divisions. These conditions are rationalized and perpetuated through rhetoric that stigmatizes, stereotypes, and enforces segregation. Intersecting layers of marginalization are created by a labor system that maximally extracts and exploits low-wage migrant workers. Discursive techniques used by state-owned media and legislation also portray FDW as ungovernable and promiscuous employer property that supersedes and eclipses their civil rights (Kaur-Gill, Pandi & Dutta, 2021).

“No Hijab in Workplace”: Discrimination against Muslim Women Employees in Indonesian Property Companies

The challenges of injustice faced by Muslim Women Employees who wear the hijab in the workplace still occur and have an impact on undeveloped career paths and low-paying job positions. Certain job positions do not require Muslim Women to wear the hijab, and some companies ask Muslim women who wear the hijab to take off their hijab. This research aimed to explore the challenges experienced by Muslim Women Employees who wear the hijab in their career paths and job positions at three property sector companies in Tangerang, Bekasi, and Semarang. The research was conducted using a qualitative phenomenological study method, and there were four informants from property companies in the Bekasi area, three people from property companies in the Tangerang area, and three from property companies in the Semarang area. The results of this study show that the forms of challenges experienced by the informants impacted their performance. Thus, the informants chose to resign from their jobs, and only one informant changed divisions. The study results also show that Muslim Women Employees who wear the hijab experience career stagnation due to non-objective assessments by superiors who do not like the way their hijab.

WORK PRECARITY AND THE AGING WORKFORCE: TRENDS IN HEALTH DISPARITY AMONG OLDER SERVICE SECTOR WORKERS

Abstract Work precarity may affect workers’ physical, mental, and social well-being as navigating uncertain and insecure work conditions interacts with factors such as housing, family caretaking, and personal relationships. In particular, the service sector has long been characterized by work precarity as compared to other industries in the US, where noncollege workers are far more vulnerable to non-standard and low-wage work and Black, Indigenous, and workers of color are overrepresented. For older adults, structural and systemic inequities may exacerbate health conditions and accelerates biological aging. In this study, we measure work precarity among noncollege older workers (55-75 years old) in three large and growing service sector industries in the US: health care, retail, and food service, to access the impact of work precarity on older low-wage worker’s health outcomes, exits from the formal wage labor workforce, and linkages between work precarity and health disability.

Have low-paid jobs increased in the Swedish labor market? Defining low pay in the context of the Nordic model

Can the Nordic wage-setting model, where social partners decide wages through collective agreements, counteract a growing low-paid sector? This article tests four definitions of low-paid jobs to analyze whether this sector has grown for the period 2005–2020 in Sweden. Despite policy changes pointing towards growth, all definitions show a slight decrease in low-paid jobs over time. The authors argue that the industrial relations system, with the aim of keeping the industry wage increases in check to aid export competitiveness, also sets a uniform level wage that limits low-paid jobs. It is also found that low pay in the Swedish setting is partly a result of working less than full-time or having unstable employment, and service workers and those with low education are becoming increasingly common in this position.

Commuting barriers to low-wage employment

Lack of access to affordable transportation has been hypothesized to be a barrier to employment among low-wage workers. We build a structural job search model to investigate how commuting costs influence the employment decisions of low-wage workers in the United States, and whether differences in commuting by race and education can explain observed disparities in employment. We find that commuting itself poses a significant barrier to overall low-wage employment, as the associated costs are high relative to potential wages. However, we find that inter-group differences in commuting costs account for a much smaller fraction of inter-group employment disparities than do differences in other labor market factors such as the wage offer distribution and offer arrival rates.