Monthly Current Population Survey Research Articles

The Effect of Immigration on Labor Market Transitions of Native-Born Unemployed in the United States

Unemployed workers are the group most likely to be affected by the presence of immigrants in their local labor markets since they are actively competing for job opportunities. Yet, little is known about the effect of immigration on labor market opportunities of the unemployed. Using a sample of unemployed native-born citizens from the monthly Current Population Survey from 2001 to 2015 and state level immigration statistics, we employ a multinomial model in the framework of a discrete hazard model with competing risks to examine the effects of immigration on the transition out of unemployment. The results suggest that immigration does not affect attrition not the probabilities of native-born workers finding a job. Instead, we find that immigration is associated with smaller probabilities of remaining unemployed.

Job-Finding and Job-Losing: A Comprehensive Model of Heterogeneous Individual Labor-Market Dynamics

We study the paths over time that individuals follow in the labor market, as revealed in the monthly Current Population Survey. Some people face much higher flow values from work than in a non-market activity; if they lose a job, they find another soon. Others have close to equal flow values and tend to circle through jobs, search, and non-market activities. And yet others have flow values for non-market activities that are higher than those in the market, and do not work. We develop a model that identifies and quantifies heterogeneity in dynamic individual behavior. Our model provides a bridge between research on monthly transition rates in the tradition of Blanchard and Diamond (1990) and research on economic dynamics in the tradition of Mortensen and Pissarides (1994). Our estimates discern 5 distinct types. Most unemployment comes from just two of those types. Low employment types frequently circle among unemployment, short-term jobs, and being out of the labor market. Short-term jobs play a role in the job-finding process related to the role of unemployment. These are stop-gap jobs for high-employment types and a part of circling for low-employment types. Because of their high job-finding rates, and despite their low flow values of non-work relative to work, the volatility of the future lifetime value that high-employment types derive from work and non-work is lower than for low-employment types.

Covid-19 School Closures and Parental Labor Supply in the United States

We examine the role of school closures in contributing to the negative labor market impacts of the COVID-19 pandemic. We collect detailed daily information on school closures at the school-district level, which we merge to individual level data on various employment and socio- demographic characteristics from the monthly Current Population Survey from January 2019 through May 2020. Using a difference-in-differences estimation approach, we gauge how the intensity of school closures affects the labor supply of mothers and fathers of young school-age children. We find evidence of non-negligible labor supply reductions, particularly among mothers. These impacts prove robust to endogeneity checks and persist after accounting for other social-distancing measures in place.

Measuring Employer-to-Employer Reallocation

We revisit measurement of Employer-to-Employer (EE) transitions, the main engine of labor market competition and employment reallocation, in the monthly Current Population Survey (CPS). We follow Fallick and Fleischman (2004) and exploit a key survey question introduced with the 1994 CPS redesign. We detect a sudden and sharp increase in the incidence of missing answers to this question starting in 2007, when the U.S. Census Bureau introduced a change in survey methodology, the Respondent Identification Policy (RIP). We show evidence of selection into answering the EE question by both observable and unobservable worker characteristics that correlate with EE mobility. We propose a selection model and a procedure to impute missing answers to the key survey question, thus EE transitions, after the introduction of the RIP. Our imputed EE aggregate series restores a close congruence with the business cycle, especially with the onset of the Great Recession, exhibits a much less dramatic drop in 2008-2009 and a full recovery by 2016, and eliminates the spurious appearance of declining EE dynamism in the US labor market after 2000. We also offer the first evidence of the (large and negative) impact of the COVID-19 crisis on EE reallocation.

Income and Poverty in the COVID-19 Pandemic

:This paper addresses the economic impact of the COVID-19 pandemic by providing timely and accurate information on the impact of the current pandemic on income and poverty to inform the targeting of resources to those most affected and assess the success of current efforts. We construct new measures of the income distribution and poverty with a lag of only a few weeks using high-frequency data from the Basic Monthly Current Population Survey (CPS), which collects income information for a large, representative sample of US families. Because the family income data for this project are rarely used, we validate this timely measure of income by comparing historical estimates that rely on these data to estimates from data on income and consumption that have been used much more broadly. Our results indicate that at the start of the pandemic, government policy effectively countered its effects on incomes, leading poverty to fall and low percentiles of income to rise across a range of demographic groups and geographies. Simulations that rely on the detailed CPS data and that closely match total government payments made show that the entire decline in poverty that we find can be accounted for by the rise in government assistance, including unemployment insurance benefits and the Economic Impact Payments. Our simulations further indicate that of those losing employment the vast majority received unemployment insurance, though this was less true early on in the pandemic, and receipt was uneven across the states, with some states not reaching a large share of their out of work residents. Updated results during the pandemic for a subset of the tables in this article can be found at povertymeasurement.org.

Winter Weather and Work Hours: Heterogeneous Effects and Regional Adaptation

Winter weather affects hours worked. We examine how work hours reported in the monthly Current Population Survey (CPS) vary with respect to snowfall in 265 metropolitan areas over the years 2004-2014. The effects of snowfall on work hours vary across types of workers, occupation, industry, and region. Losses in work hours due to snow events are particularly large in the South and among construction workers. An average daily inch of snowfall during a reference week reduces work by about an hour. Few of the hours lost from large snowfalls are made-up in subsequent weeks. A back-of-an-envelope calculation suggests that in an average year, snow leads to a 0.15 percent loss in annual hours worked, a small but nontrivial impact.

Understanding Trends in Alternative Work Arrangements in the United States

This article discusses trends in alternative work arrangements in the United States using data from the Contingent Worker Survey (CWS) supplements to the Current Population Survey (CPS) for 1995 to 2017, the 2015 RAND-Princeton Contingent Work Survey, and administrative tax data from the Internal Revenue Service for 2000 to 2016. Based on cyclically adjusted comparisons of the CPS CWS, measures using self-respondents in the CPS CWS, and measures of self-employment and 1099 workers from administrative tax data, we conclude that there has likely been a modest upward trend in the share of the U.S. workforce in alternative work arrangements during the 2000s. We also present evidence from Amazon Mechanical Turk suggesting that the basic monthly CPS question on multiple job holding misses many instances of multiple job holding.

Using the Annual Social and Economic Supplement as Part of a Current Population Survey Panel.

The Annual Social and Economic Supplement (ASEC) is the most widely used type of Current Population Survey (CPS) data, but it is cumbersome to use the ASEC as part of a longitudinal CPS panel, especially linking to non-March months. In this paper, we detail the challenges associated with linking the ASEC to monthly CPS data, outline the creation of an identifier that links the ASEC and the March Basic Monthly data from 1989 through 2017, and provide substantive examples that illustrate the value of combining the ASEC with monthly data. The variable, MARBASECID, which we created to link ASEC and March monthly CPS data, represents a significant contribution to social and economic data infrastructure, saving individual researchers from having to duplicate the effort required to create linkages between ASEC and monthly CPS data.

Bayesian Nonparametric Functional Mixture Estimation for Time-Series Data, With Application to Estimation of State Employment Totals

The U.S. Bureau of Labor Statistics use monthly, by-state employment totals from the Current Population Survey (CPS) as a key input to develop employment estimates for counties within the states. The monthly CPS by-state totals, however, express high levels of volatility that compromise the accuracy of resulting estimates composed for the counties. Typically-employed models for small area estimation produce de-noised, state-level employment estimates by borrowing information over the survey months, but assume independence among the collection of by-state time series, which is typically violated due to similarities in their underlying economies. We construct Gaussian process and Gaussian Markov random field alternative functional prior specifications, each in a mixture of multivariate Gaussian distributions with a Dirichlet process (DP) mixing measure over the parameters of their covariance or precision matrices. Our DP mixture of functions models allow the data to simultaneously estimate a dependence among the months and between states. A feature of our models is that those functions assigned to the same cluster are drawn from a distribution with the same covariance parameters, so that they are similar, but don't have to be identical. We compare the performances of our two alternatives on synthetic data and apply them to recover de-noised, by-state CPS employment totals for data from $2000-2013$.

Health Reform and Retirement.

To analyze whether there was an increase in retirement or in part-time work among older workers after January 2014, when new health insurance coverage options became available because of the Affordable Care Act (ACA). We analyze trends in retirement and part-time work for individuals aged 50-64 years in the basic monthly Current Population Survey from January 2008 through June 2016. We test for a break in trend in January 2014. We also test for differences in trends, both before and after 2014, in states that expanded their Medicaid programs in January 2014 under the ACA compared with those that did not. We find that there was no change in the probability of retirement or part-time work among older workers in 2014 and later, either overall or in Medicaid expansion states relative to nonexpansion states. Although many observers had predicted that an unintended consequence of health reform would be reduced labor supply, we find no evidence of this for older workers in the first 2.5 years after the law's major coverage provisions took effect.

Unemployed, Now What? The Effect of Immigration on Unemployment Transitions of Native-Born Workers in the United States

Although one would expect the unemployed to be the population most likely affected by immigration, most of the studies have concentrated on investigating the effects immigration has on the employed population. Little is known of the effects of immigration on labor market transitions out of unemployment. Using the basic monthly Current Population Survey from 2001–13 we match data for individuals who were interviewed in two consecutive months and identify workers who transition out of unemployment. We employ a multinomial model to examine the effects of immigration on the transition out of unemployment, using state-level immigration statistics. The results suggest that immigration does not affect the probabilities of native-born workers finding a job. Instead, we find that immigration is associated with smaller probabilities of remaining unemployed, but it is also associated with higher probabilities of workers leaving the labor force. This effect impacts mostly young and less educated people.

Unemployed, Now What? The Effect of Immigration on Unemployment Transitions of Native-Born Workers in the United States

Although one would expect the unemployed to be the population most likely affected by immigration, most of the studies have concentrated on investigating the effects immigration has on the employed population. Little is known of the effects of immigration on labor market transitions out of unemployment. Using the basic monthly Current Population Survey from 2001–13 we match data for individuals who were interviewed in two consecutive months and identify workers who transition out of unemployment. We employ a multinomial model to examine the effects of immigration on the transition out of unemployment, using state-level immigration statistics. The results suggest that immigration does not affect the probabilities of native-born workers finding a job. Instead, we find that immigration is associated with smaller probabilities of remaining unemployed, but it is also associated with higher probabilities of workers leaving the labor force. This effect impacts mostly young and less educated people.

The Impact of Population Aging and Delayed Retirement on Workforce Productivity

As the population grows older, an increasing share of the workforce will be past age 60. Older workers have often been considered less productive than younger ones, raising the issue of whether an aging workforce will also be a less productive one. This paper uses evidence from the monthly Current Population Survey files to shed light on the issue. It documents the rapidly growing role of older workers in the labor market and the steady improvement in their relative earnings. Compared with earlier generations of aged Americans and compared with contemporary prime-age workers, today’s elderly are unusually well educated. Their high relative earnings and later retirement are partly explained by this fact. At the same time, the paper offers evidence that more productive workers stay in the workforce longer than less productive ones. Using a standard measure of worker productivity – hourly wages – workers between 60 and 74 are more productive than average workers who are younger. Compared with workers between 25 and 59, the pay premium for older workers is currently between 10 percent and 20 percent of the average wage earned by the younger workers. That pay premium has been increasing for a decade. There is little evidence the aging workforce has hurt productivity.

House lock and structural unemployment

A recent decline in internal migration in the United States may have been caused in part by falling house prices, through the “lock in” effects of financial constraints faced by households whose housing debt exceeds the market value of their home. I analyze the relationship between such “house lock” and the elevated levels and persistence of unemployment during the recent recession and its aftermath, using data for the years 2008–11. Because house lock is likely to extend job search in the local labor market for homeowners whose home value has declined, I focus on differences in unemployment duration between homeowners and renters across geographic areas differentiated by the severity of the decline in home prices. The empirical analyses rely on microdata from the monthly Current Population Survey (CPS) files and on an econometric method that enables the estimation of individual and aggregate covariate effects on unemployment durations using repeated cross-section data. I do not uncover systematic evidence to support the house-lock hypothesis.

House Lock and Structural Unemployment

A recent decline in internal migration in the United States may have been caused in part by falling house prices, through the “lock in” effects of financial constraints faced by households whose housing debt exceeds the market value of their home. I analyse the relationship between such “house lock” and the elevated levels and persistence of unemployment during the recent recession and its aftermath, using data for the years 2008-11. Because house lock is likely to extend job search in the local labour market for homeowners whose home value has declined, I focus on differences in unemployment duration between homeowners and renters across geographic areas differentiated by the severity of the decline in home prices. The empirical analyses rely on microdata from the monthly Current Population Survey (CPS) files and an econometric method that enables the estimation of individual and aggregate covariate effects on unemployment durations using repeated cross-section data. I do not uncover systematic evidence to support the house-lock hypothesis.

House Lock and Structural Unemployment

A recent decline geographic mobility the United States may have been caused part by falling prices, through the in effects of financial constraints faced by households whose housing debt exceeds the market value of their home. I analyze the relationship between such house and the elevated levels and persistence of unemployment during the recent recession and its aftermath, using data that covers the period through the end of 2011. Because lock will extend job search the local labor market for homeowners whose home value has declined, I focus on differences unemployment duration between homeowners and renters across geographic areas differentiated by the severity of the decline home prices. The empirical analyses rely on microdata from the monthly Current Population Survey (CPS) files and an econometric method that enables the estimation of individual and aggregate covariate effects on completed unemployment durations synthetic cohort (pseudo-panel) data. The estimates indicate the absence of a meaningful lock effect on unemployment duration.

Does the Internet Help the Unemployed Find Jobs?

This paper investigates whether using the Internet for job search helps unemployed workers find jobs. The self-selection of Internet job searchers is addressed by the instrumental variable (IV) estimation strategy. I isolate potentially exogenous variation in individuals’ Internet job search status by exploiting variation in adoption of the Internet across occupations. The fraction of unemployed workers using the Internet to search for jobs increased more rapidly in occupations with higher computer use rates before the introduction of the Internet. The analysis sample consists of unemployed workers from the September 1992 Basic Monthly Current Population Survey (CPS) and the December 1998, August 2000, and September 2001 CPS Computer and Internet Use Supplements. The unemployed workers are longitudinally matched with their employment outcomes from the subsequent CPS files. The panel structure of the CPS enables us to follow the individuals for up to subsequent 15 months. The IV results suggest that unemployed workers searching for jobs online are around 14 percentage points more likely to be employed during the 15 month follow-up period than unemployed workers who do not engage in Internet job search. This implies that using the Internet for job search raises the 15-month job finding rate by around 26 percent at the mean.

A CAUTIONARY NOTE ON USING (MARCH) CURRENT POPULATION SURVEY AND PANEL STUDY OF INCOME DYNAMICS DATA TO STUDY WORKER MOBILITY

The monthly Current Population Survey (CPS), with its annual demographic March supplement, and the Panel Study of Income Dynamics (PSID) are the leading sources of data on worker reallocation across occupations, industries, and firms. Much of the active current research is based on these data. In this paper, we contrast these data sets as sources of data for measuring the dynamics of worker mobility. We find that (i) (March) CPS data are characterized by a substantial amount of noise when it comes to identifying occupational and industry switches; (ii) March CPS data provide a poor measure of annual occupational mobility and, instead, most likely measure mobility over a much shorter period; (iii) (the changes in) the procedure to impute missing data have a dramatic effect on the interpretation of the CPS data in, e.g., the trend in occupational mobility. The most important shortcomings of the PSID are the facts that (i) occupational and industry affiliation data are available in most years at an annual frequency; (ii) the PSID's sample, by design, excludes immigrants arriving in the United States after 1968; (iii) the Retrospective Occupation–Industry Files with reliable occupation and industry affiliation data are available only until 1980.

Panel Conditioning in Longitudinal Studies: Evidence From Labor Force Items in the Current Population Survey

Does participating in a longitudinal survey affect respondents' answers to subsequent questions about their labor force characteristics? In this article, we investigate the magnitude of panel conditioning or time-in-survey biases for key labor force questions in the monthly Current Population Survey (CPS). Using linked CPS records for household heads first interviewed between January 2007 and June 2010, our analyses are based on strategic within-person comparisons across survey months and between-person comparisons across CPS rotation groups. We find considerable evidence for panel conditioning effects in the CPS. Panel conditioning downwardly biases the CPS-based unemployment rate, mainly by leading people to remove themselves from its denominator. Across surveys, CPS respondents (claim to) leave the labor force in greater numbers than otherwise equivalent respondents who are participating in the CPS for the first time. The results cannot be attributed to panel attrition or mode effects. We discuss implications for CPS-based research and policy as well as for survey methodology more broadly.

Employment and self-employment in the wake of Hurricane Katrina

We use data from the monthly Current Population Survey to examine the short- and longer-term effects of Hurricane Katrina on the labor market outcomes of prime-age individuals in the most affected states--Alabama, Florida, Louisiana, and Mississippi--and for evacuees in any state. We focus on rates of labor force participation, employment, and unemployment, and we extend prior research by also examining rates of self-employment. With the exception of Mississippi, employment and unemployment one year after the hurricane were at similar rates as the end of 2003. This aggregate pattern of labor market shock and recovery has been observed for other disasters but masks important differences among subgroups. Those evacuated from their residences, even temporarily, were a harder-hit group, and evacuees who had yet to return to their pre-Katrina state up to one year later were hit especially hard; these findings hold even after controlling for differences in observable characteristics. We also find evidence of an important role for self-employment as part of post-disaster labor market recovery, especially for evacuees who did not return. This may result from poor job prospects in the wage and salary sector or new opportunities for starting businesses in the wake of Katrina.