Middle-income Workers Research Articles

Race/Ethnicity and Employment Insecurity: Impacts of COVID-19 on the US Labor Force and Beyond

Using the Household Pulse Survey and American Community Survey, this study examines employment insecurity experienced across different racial/ethnic groups of the U.S. labor force under the pandemic disruptions. It highlights significant employment security disparities based on race, ethnicity, and income during the pandemic. However, there are no significant gender and racial disparities within the lowest income group when controlling for other conditions. In contrast, gender and racial disparities in EI are much more pronounced among mid-to-high income groups. Non-White individuals were disproportionately affected by job loss due to health and COVID-related employment issues, unlike Whites who faced unemployment more due to other factors. This pattern was more evident among lower-income groups. The trends shifted in later stages, with high-income Black and Hispanic workers becoming more likely to be unemployed due to non-health and non-employment reasons. Middle-income workers across all races were least likely to stop working for reasons other than COVID-related health or employment issues. In addition, regardless race or ethnicity, women more likely to be unemployed due to health reasons and less so due to employment issues compared to men, and the gender disparities increased with higher household incomes. We propose that the apparent immediate effects of the pandemic are actually indicative of deeper, systemic issues within the U.S. labor market, specifically the occupational segregation tied to race/ethnicity, gender, and class. Recovery efforts must take a holistic approach and integrate economic development policies, workforce development strategies, and social policies targeting poverty alleviation, health disparities, and people of color.

Does state tax reciprocity affect interstate commuting? Evidence from a natural experiment

This paper exploits the 2010 dissolution of the personal income tax reciprocity agreement between Minnesota and Wisconsin to estimate how state tax policies affect interstate commuting. This policy shock increased tax liability for some commuters and tax compliance costs for all commuters. Using a synthetic control approach designed for panel data, we compare the interstate commuting behavior of Wisconsinites and Minnesotans to unaffected intrastate commuters who live and work in the same state, intrastate commuters who live in other large metro areas, and several multi-state metro areas in other states where income tax reciprocity remained intact. Post-dissolution, we find robust evidence that the number of interstate commuters in Wisconsin border counties falls between 3 and 5%, with stronger declines found for younger and middle-income workers.

Is China’s Urbanization Inclusive?—Comparative Research Based on Machine Learning Algorithms

Improving the inclusiveness of urban development is crucial to improving the wages of low- and middle-income workers. In this study, we used machine learning to cluster urban labor into low, middle, and high socioeconomic groups in order to analyze the effects of economic agglomeration and compare them with the results, which were classified according to income. The results showed that economic agglomeration has improved the wages of the low and middle socioeconomic groups; the estimated wage spillover effect was 3.9%. By contrast, the estimated result based on the groups classified by a single index of income was 20.3%, which represents an overestimation of the wage spillover effect of economic agglomeration. This method is often used to explain the inclusiveness of China’s urbanization, leading to overestimation. Further mechanism analysis found that the characteristics of the industrial structure affect the change in wage elasticity caused by economic agglomeration, which has a moderating effect on the wages of workers. The differing wage elasticity associated with economic agglomeration is responsible for wage disparities in China.

Impact of the macro-environment on the reporting of occupational injuries and illnesses by low-income workers compared to middle-income workers in South Africa: a mixed-methods study protocol

IntroductionConstruction workers, mineworkers and manufacturing employees in South Africa must report occupational injuries and illnesses to their employer as stipulated in section 14 of the Occupational Health and Safety Act...

The Rise of Swedish Social Democracy

AbstractWe examine the rise and mobilizational dynamics of social democracy, employing data reported by the Swedish authorities on the distribution of voting eligibility, turnout and partisan vote in local elections during the 1910s at a high level of disaggregation (by narrow income segments and administrative units). In line with the existing literature, we show that electoral socialism depended on both the extension of the suffrage to its ‘natural’ electorate, that is, the urban working class, and the organizational capacity of trade unions and other civic associations. In addition, we show that socialist support was not uniform within the working class – even for a highly homogeneous society. Instead, the social-democratic vote was initially stronger among low- to middle-income workers, only expanding to poor voters later in time. We complement our local data with an interwar panel analysis of socialist vote and post-war survey data.

Do Tax Subsidies for Retirement Saving Impact Total Private Saving? New Evidence on Middle-income Workers

Do Tax Subsidies for Retirement Saving Impact Total Private Saving? New Evidence on Middle-income Workers

Capitalisation of accessibility to dockless bike sharing in housing rentals: Evidence from Beijing

Chinese cities have seen a rapid development of dockless bike sharing (DBS) in recent years. Numerous studies have examined the positive social effects of DBS, but a crucial question remains: if docklessness has successfully reworked shared bikes into a desired and valuable amenity, will unequal access to DBS affect housing rentals? The present study examines this question by considering the case of Beijing. A big data approach is employed to analyse the listed rents of 75,197 houses in Beijing and their attributes that affect housing rentals. Measurement of accessibility to DBS at the housing level is constructed from 3.2 million DBS trips generated over two weeks. Results of the hedonic model show that every one-point increase in the accessibility to DBS generates a premium worth 28.02 CNY in housing rental, thereby supporting the hypothesis that docklessness has turned DBS into a valuable amenity for renters. These findings suggest that although low- and middle-income workers benefit from the convenience of DBS in the short term, the benefits are gradually eroded and transferred to landlords through rental premiums. Unequal accessibility to DBS may induce gentrification that displaces or excludes low-income renters in certain neighbourhoods.

Quantifying the employment accessibility benefits of shared automated vehicle mobility services: Consumer welfare approach using logsums

Abstract The goal of this study is to assess and quantify the potential employment accessibility benefits of shared-use automated vehicle (AV) mobility service (SAMS) modes across a large diverse metropolitan region considering heterogeneity in the working population. To meet this goal, this study proposes employing a welfare-based (i.e. logsum-based) measure of accessibility, obtained via estimating a hierarchical work destination-commute mode choice model. The employment accessibility logsum measure incorporates the spatial distribution of worker residences and employment opportunities, the attributes of the available commute modes, and the characteristics of individual workers. The study further captures heterogeneity of workers using a latent class analysis (LCA) approach to account for different worker clusters valuing different types of employment opportunities differently, in which the socio-demographic characteristics of workers are the LCA model inputs. The accessibility analysis results in Southern California indicate: (i) the accessibility benefit differences across latent classes are modest but young workers and low-income workers do see higher benefits than high- and middle-income workers; (ii) there are substantial spatial differences in accessibility benefits with workers living in lower density areas benefiting more than workers living in high-density areas; (iii) nearly all the accessibility benefits come from the SAMS-only mode as opposed to the SAMS+Transit mode; and (iv) the SAMS cost per mile assumption significantly impacts the magnitude of the overall employment accessibility benefits.

Quantifying the Employment Accessibility Benefits of Shared Automated Vehicle Mobility Services: Consumer Welfare Approach Using Logsums

The goal of this study is to assess and quantify the potential employment accessibility benefits of shared-use automated vehicle (AV) mobility service (SAMS) modes across a large diverse metropolitan region considering heterogeneity in the working population. To meet this goal, this study proposes employing a welfare-based (i.e. log-sum-based) measure of accessibility, obtained via estimating a hierarchical work destination-commute mode choice model. The employment accessibility log-sum measure incorporates the spatial distribution of worker residences and employment opportunities, the attributes of the available commute modes, and the characteristics of individual workers. The study further captures heterogeneity of workers using latent class analysis (LCA) to account for different worker clusters valuing different types of employment opportunities differently, in which the socio-demographic characteristics of workers are the LCA model inputs. The accessibility analysis results in Southern California indicate: (i) the accessibility benefit differences across latent classes are modest but young workers and low-income workers do see higher benefits than high- and middle-income workers; (ii) there are substantial spatial differences in accessibility benefits with workers living in lower density areas benefiting more than workers living in high-density areas; (iii) nearly all the accessibility benefits come from the SAMS-only mode as opposed to the SAMS+Transit mode; and (iv) the SAMS cost per mile assumption significantly impacts the magnitude of the overall employment accessibility benefits.

Decision Time: The Alberta Shadow Budget 2019

In its upcoming budget, Alberta’s government has a once-in-a-generation opportunity to correct the province’s fiscal course. This Shadow Budget demonstrates how Alberta could return to budget balance by 2022-23 and plot a sustainable path for balanced budgets over the long-term horizon. The Shadow Budget illustrates that, by careful spending restraint and restructuring of its revenues, Alberta could move to saving resource revenues and increasing investment income for future generations. This vision contrasts with a status quo where budgetary headwinds from an aging population would drag Alberta back into mounting deficits – along with a downward spiral of debt service costs – in the coming decades. But long-term fiscal sustainability will require near-term measures to restore Alberta’s budget balance and then sustain surpluses. Building on the recent MacKinnon Report, this Shadow Budget shows that a four-year freeze is advisable to bring Alberta’s program spending in line with per capita levels in other provinces. This report goes further to outline a set of reductions in inflation-adjusted per capita spending across program areas to achieve this top-line spending freeze. This Shadow Budget recommends specific reductions in inflation-adjusted spending in health and education through a revamp in funding for hospitals, wages for nurses, fee-for-service rates for physicians, administration costs in education, salaries for teachers, increased class sizes, and per student funding for universities and colleges. Significant restraint for inflation-adjusted spending will also be required for social services and spending by government departments – particularly through grants and external procurement. While a freeze might be achieved in other ways, this Shadow Budget provides specific targets for spending restraint based on nationwide benchmarking, observing that Alberta out-spends counterpart provinces without demonstrably better service levels or outcomes. In order to moderate new debt for capital outlays, this Shadow Budget also proposes a substantial down-sizing of Alberta’s capital plan, highlighting Alberta’s comparatively high per capita stock of public infrastructure assets and capital grants to municipalities. Nonetheless, even with rigorous spending restraint, this report also shows that rebalancing revenues will be critical for Alberta to reduce distortionary corporate and personal income taxes while sustaining surpluses over the long term. Even after return to balance, ongoing surpluses are necessary in order to save resource revenues. Drawing on widely accepted economic principles, this Shadow Budget argues that resource revenues should be saved. This is because these represent a one-time conversion of Alberta’s natural capital in which future generations of Albertans should also share through sustainable returns on investments from Alberta’s Heritage Fund. Therefore, following the projected return to balance in 2022-23, this Shadow Budget proposes to reduce the marginal rate for the lowest personal income tax bracket and implement a consumption tax (recognizing this requires an affirmative result in a province-wide referendum). This Shadow Budget shows how this reduction of personal income tax rates would enhance Alberta’s attractiveness to middle-income workers. The establishment of a 3 percent consumption tax (harmonized with the federal Goods and Services Tax) would replace reduced revenues from more distortionary corporate and personal income taxes while allowing Alberta to save for a sustainable fiscal future.

Work-Nonwork Spillover of Wage Justice through Work Capabilities in Low and Middle Income Workers

Wage justice literature asserts that it is the perceived fairness of pay (based on comparison others) instead of actual pay that matters most to an employee. This study therefore investigates the spillover effect of wage justice on life capabilities in the Philippines. It is hypothesized that wage justice will influence life capability through work capabilities such as job empowerment, job satisfaction, and occupational pride. Using data from the Institute of Philippine Culture study on living wages of 500 individuals, a structural equation model was estimated to test the spillover effect. Findings confirms the hypothesis that wage justice influences life capabilities (life satisfaction and physical well-being) through work capabilities. Implications for research on wage justice and capabilities as well as to people management practices in work organizations are discussed.

Why Did Employer Coverage Fall In Massachusetts After The ACA? Potential Consequences Of A Changing Employer Mandate.

The Affordable Care Act (ACA) attempted to minimize disruptions to employer-sponsored insurance in part by implementing an employer mandate. Research has shown that employer coverage rates have been stable nationally under the ACA. Massachusetts enacted its own employer mandate in 2006 before eliminating it in 2014, in anticipation of the federal mandate. But the ACA's employer mandate was delayed until 2015 and exempted smaller firms that had been covered by the Massachusetts' mandate. In this unique policy environment, we found that the employer-sponsored insurance rate in Massachusetts fell by 2.3 percentage points after the ACA's coverage expansion took effect (2014-16), compared to the rest of the US. Coverage dropped more for middle-income workers than for lower-income workers, which suggests that crowd-out by Medicaid was not the primary factor. Employer surveys show that employer coverage offer rates declined significantly at small firms in Massachusetts beginning in 2014, but not at large firms. Our findings suggest that eliminating Massachusetts's employer mandate may have contributed to falling employer coverage rates in the state, although other policy and economic factors cannot be ruled out. These results may have implications for understanding the effects of the ACA's employer mandate and its potential repeal.

Wage Stagnation and Buyer Power: How Buyer-Supplier Relations Affect U.S. Workers’ Wages, 1978 to 2014

Since the 1970s, market restructuring has shifted many workers into workplaces heavily reliant on sales to outside corporate buyers. These outside buyers wield substantial power over working conditions among their suppliers. During the same period, wage growth for middle-income workers stagnated. By extending organizational theories of wage-setting to incorporate interactions between organizations, I predict that wage stagnation resulted in part from production workers’ heightened exposure to buyer power. Panel data on publicly traded companies shows that dependence on large buyers lowers suppliers’ wages and accounts for 10 percent of wage stagnation in nonfinancial firms since the 1970s. These results are robust to a series of supplementary measures of buyer power; instrumental variable analysis using mergers between buyers; corrections for selection and missing data; and controls for individual worker characteristics like education and occupation. The results show how product market restructuring and new forms of economic segmentation affect workers’ wages. The spread of unequal bargaining relations between corporate buyers and their suppliers has slowed wage growth for workers.

The Biographical and Human Resource Management Predictors of Union Membership Engagement of Low- and Middle-Income Workers

In this study, the researcher investigated the biographical and human resource management (HRM) predictors of union membership. The literature reviewed revealed that there is little research on this topic in the South African context. The literature reviewed also showed that males, permanent employees, employees who are less committed, who have a level of quality of work-life (QWL) and engagement, and those who are satisfied are more likely to be unionized. A cross-sectional survey design was used to address the research questions. One thousand questionnaires were distributed and 874 were completed by the respondents at Marabastad Mall in the City of Tshwane Metropolitan Municipality (CTMM) in South Africa. The study results showed that employment status was the highest predictor ( -1.782, p<0.05) of union membership, and gender and job satisfaction were not predictors of union members. This study had managerial implications, in the sense that when hiring employees on a part-time basis, having employees who are committed and offering employees QWL (i.e. excellent fringe benefits) will impact negatively on union membership. In terms of policymakers, the study revealed that developing remuneration policies that are pro-employee (i.e. offering excellent working conditions and fringe benefits) would make them satisfied, possibly be productive, and they would engage less in counterproductive industrial actions like strikes, which in South Africa are the amongst highest in the world.

The Biographical and Human Resource Management Predictors of Union Membership Engagement of Low- and Middle-Income Workers

In this study, the researcher investigated the biographical and human resource management (HRM) predictors of union membership. The literature reviewed revealed that there is little research on this topic in the South African context. The literature reviewed also showed that males, permanent employees, employees who are less committed, who have a level of quality of work-life (QWL) and engagement, and those who are satisfied are more likely to be unionized. A cross-sectional survey design was used to address the research questions. One thousand questionnaires were distributed and 874 were completed by the respondents at Marabastad Mall in the City of Tshwane Metropolitan Municipality (CTMM) in South Africa. The study results showed that employment status was the highest predictor ( = -1.782, p<0.05) of union membership, and gender and job satisfaction were not predictors of union members. This study had managerial implications, in the sense that when hiring employees on a part-time basis, having employees who are committed and offering employees QWL (i.e. excellent fringe benefits) will impact negatively on union membership. In terms of policymakers, the study revealed that developing remuneration policies that are pro-employee (i.e. offering excellent working conditions and fringe benefits) would make them satisfied, possibly be productive, and they would engage less in counterproductive industrial actions like strikes, which in South Africa are the amongst highest in the world.

Measuring Trends in Urban Inequality and Poverty in the Copperbelt, Zambia

This article is a discussion of how to measure urban inequality using the results of large household samples. It has two aims. The first is to de-mystify the methods of measuring earnings inequality by discussing their logic and their results in plain language that is suitable for a non-specialist audience. The second is to persuade the reader that such surveys can be suitable for measuring income derived from all kinds of livelihood strategies, including informal sector activities. The results show persistently high levels of inequality over time among income earners on the Copperbelt. Disaggregation of the employed workforce by major occupational groups reveals increasingly more elementary and middle-income workers than higher income managers, professionals, and technicians. This pattern differs by gender, however, with only women experiencing a marked increase in low-skill, low-wage employment.

El problema y la política de vivienda en Chile: propuestas para una nueva perspectiva de análisis

El problema habitacional chileno ha sido estudiado casi exclusivamente fijando la mirada en el Estado y los sectores sociales de bajos ingresos. Muy poco se conoce sobre el rol que desempeñaron los empresarios y trabajadores de ingresos medios en las políticas de vivienda. Este texto propone integrar al análisis a dichos actores urbanos fundamentales con el objetivo de alcanzar un saber más complejo, integral y matizado. Para ello se centró el análisis en la primera política nacional de la vivienda (1952-1958). Las conclusiones confirman el supuesto recién señalado.

Exploring Differences in Commuting Behaviour among Various Income Groups during Polycentric Urban Development in China: New Evidence and Its Implications

Income status is an important variable that is strongly associated with certain commuting behaviours of workers. This paper presents new evidence on how polycentric development impacts on workers’ commuting behaviour among various income groups in Beijing, China. This study suggests that three key influencing factors—the public transport network, the location of affordable housing projects and the process of employment decentralisation—have played significant roles in affecting workers’ commuting behaviour. The results of regression analysis indicate that subway and bus transport significantly and negatively influenced the commuting times of low- and middle-income workers, but the two transport modes did not have a significant influence on the commuting times of high-income workers. The findings from this research suggest that policies for promoting employment decentralisation during polycentric development have the potential to reduce workers’ commuting times through promoting jobs-housing balance in the sub-centres. The results of this study indicate that a balanced jobs-housing relationship can be achieved through adjustment of affordable housing locations, and this can be effective in shortening low-income workers’ commuting times in the sub-centres of Beijing.

A Portfolio Approach to Retirement Income Security

Workers with defined contribution retirement plans face a daunting array of choices as they enter retirement. They need to decide how to allocate their savings among asset classes and how much to withdraw from savings to support retirement. They also need to make choices about when to claim Social Security and whether or not to purchase annuities (and what type to purchase) to provide guaranteed lifetime income in addition to Social Security. In this article, we report on a recent collaboration between the Stanford Center on Longevity (SCL) and the Society of Actuaries (SOA) aimed at analyzing the various alternatives and finding optimal combinations of asset and product allocations, and strategies for withdrawing funds from savings. An important objective in this work has been finding solutions that are sufficiently straightforward to be implemented by retiring workers in employer-sponsored retirement plans or by utilizing low-cost advice options. Solutions that require substantial adviser involvement may be too expensive for typical middle-income workers. While the report focuses on solutions for defined contribution retirement plans, its framework can also be applied to out-of-plan solutions.

Do Canadians Save Too Little?

The common notion that Canadians save too little for retirement, which often underpins discussions of pension reform, requires closer examination. The author brings fresh thinking to the issue and comes to a very different conclusion. First, he assesses the assumptions underlying the assertion that few middle-income workers have sufficient retirement savings. They are: 1. the household saving rate, which is calculated by Statistics Canada as a by-product of Canada’s National Accounts, is a reliable estimate of the amount that Canadian workers set aside for retirement; and 2. to maintain their pre-retirement lifestyle after they retire, Canadians need to replace 70 percent of their gross employment income. Neither assumption is correct, says the author. To demonstrate why, he examines the failings of the household saving rate as a measure of retirement savings; takes a closer look at the factors that have contributed to the decline in household saving and to explain how this decline has been misinterpreted; discusses the limitations of the 70 percent replacement target and asks how much Canadians really need to save for retirement. Finally, he questions the reliability of the studies on which the Province of Ontario has relied in making the case for the Ontario Retirement Pension Plan and discusses the policy implications. Canadians are reasonably well prepared for retirement, he concludes. Most save more than the 5 percent household saving rate. Most can retire comfortably on less than the traditional 70 percent replacement target. The greatest challenges come early in their adult lives when the burdens of acquiring a home and supporting young children strain the family budget. After that, things get easier. As studies of our retirement system become more sophisticated, we focus more on the distribution of outcomes and less on the averages. We inevitably discover that while many appear to be saving too much relative to the arbitrary thresholds chosen for these studies, others appear to be saving too little. The size of the group that appears to be “at risk” cannot be accurately determined nor can the attributes of its members be usefully described. When studies conclude that gross replacement targets are unreliable measures of retirement income adequacy due to the diversity of our population, they are also concluding that programs like the Canada and Quebec Pension Plans can go only so far in addressing our retirement needs. They can establish a lowest common denominator – a replacement target that all Canadians should strive to equal or exceed. Beyond that, we need better-targeted programs – programs that are better able to recognize and address our individual needs.