Labor Market Structure Research Articles

Job-to-Job Flows and Wage Dynamics in France and Italy

Some recent literature about the U.S. shows that wage dynamics are more influenced by job-to-job flows than by flows into or out of employment. In this paper, we evaluate whether this result holds also for France and Italy, characterized by a different labor market structure. Using comparable administrative data we find that, as in the U.S., in both France and Italy realized job-to-job transitions contribute positively to wage growth. However, since these flows are smaller and display much lower cyclicality than in the U.S., their contribution to aggregate wage dynamics is low, while the contribution of flows into and out of employment remains sizeable. We then look closely at the heterogeneity in the probability of changing job and in the associated wage premium by types of workers and firms. We find that job-to-job flows and the associated gain tend to be larger in high-skilled occupations and for permanent workers. Moreover, as in the U.S., individuals are more likely to move to younger firms, which intensively poach workers from other firms.

Job-to-job Flows and Wage Dynamics in France and Italy

Some recent literature about the U.S. shows that wage dynamics are more influenced by job-to-job flows than by flows into or out of employment. In this paper, we evaluate whether this result holds also for France and Italy, characterized by a different labor market structure. Using comparable administrative data we find that, as in the U.S., in both France and Italy realized job-to-job transitions contribute positively to wage growth. However, since these flows are smaller and display much lower cyclicality than in the U.S., their contribution to aggregate wage dynamics is low, while the contribution of flows into and out of employment remains sizeable. We then look closely at the heterogeneity in the probability of changing job and in the associated wage premium by types of workers and firms. We find that job-to-job flows and the associated gain tend to be larger in high-skilled occupations and for permanent workers. Moreover, as in the U.S., individuals are more likely to move to younger firms, which intensively poach workers from other firms.

Income gaps: Education and inequality

The aim of this paper is to analyze the employment-related real income gaps according to the education level reached by the working population during the 1997–2017 period. Using a panel methodology (pseudo-cohorts) it sums up that throughout recession, employment-related real income gaps by education level are wider, amplifying income inequality. During the economic boom the narrowing of the gap was due to the weak growth in skilled employment that did not manage to recover the pre-crisis values. This phenomenon is typical of a labour market structure with less skilled employment demand than its increasing supply. The employment-related difference in reduction of the real income gaps is exclusively reflected by a decline in employees from the highest education segment. The whole of tertiary education although with less intensity, replicates its trend. Not only educational credentials increase future employment-related income but also starting then not completing a university degree provides a significant disparity. Gender control shows a sharp drop in its determination.

WORKERS OF THE WORLD, UN-UNITED: A DISCUSSION THROUGH A GENDERED LENS ON WHY STRONGER PROTECTION OF WORKERS IN THE INFORMAL ECONOMY WILL BETTER EQUIP SOUTH AFRICA TO COPE WITH LABOUR MARKET CHANGES OF THE FOURTH INDUSTRIAL REVOLUTION

This article will investigate the readiness for labour legislation to cater for the Fourth Industrial Revolution (4IR) by comparing the structure of the current labour market and that of the future, through a gendered perspective. There are two core protections that underpin employee entitlements and rights. The first is the formal recognition of an individual as an employee or worker, which is often formalised through an employment contract. Many South Africans are engaged with work in the informal sector which do not make them privy to most of those rights and entitlements. This is problematic when considering how vulnerable these individuals already are, and that black women are concentrated in this sector. The inadequate protection of informal workers is going to pose challenges for South Africa’s ability to cope with changes brought on by the Fourth Industrial Revolution and the projected shift towards labour flexibility and casualisation. The second is collective bargaining, which empowers other rights to be realised. Collective bargaining is framed through the use of trade unions as its primary mechanism. While they may have been relevant at the time of the Labour Relation’s Act’s (LRA) inception, they have become an inappropriate medium to further workers’ rights and are projected to continue to lose members in the near future, as organisation cannot happen as effectively with a decentralised workspace and an incoherent internal firm structure. I will conclude the piece by offering recommendations which encourage more progressive labour legislation that takes into account both the changing nature of work and the specific interests of women.

Gender Gaps and the Structure of Local Labor Markets

Gender Gaps and the Structure of Local Labor Markets

The Great Disconnect: The Decoupling of Wage and Price Inflation in Japan

We take some well-known observations about the structure of the Japanese labor market and add new evidence about how it has evolved to study inflation in Japan. Our key finding is that labor market dynamics shifted after 1998 so that correlations between labor market tightness and wages weakened noticeably. This change was accompanied in a break in the relationship between wages and prices, so wage inflation has become a much less important determinant of price inflation.

Dynamics of Local Labor Market and Agricultural Structures in the Southern Part of the Okinawa Main Island

Dynamics of Local Labor Market and Agricultural Structures in the Southern Part of the Okinawa Main Island

CHINA’S SOCIAL SECURITY SYSTEM AND LABOR PROTECTION UNDER THE COVID-19 PANDEMIC

The Covid-19 pandemic has caused great economic damages and made it challenging to identify the vulnerable groups amid this global public health crisis. It is especially true in China, where the market-oriented reform has led to the rise of “migrant workers” whose rights are poorly protected. Largely improved during the years, China’s social security system are still characterized by double narrowness: narrow coverage and narrow services provided. Numerous measures adopted by the Chinese government during the fight against the Covid-19 have been limited to the enforcement of the current legal framework and marginal amelioration of existing social assistance systems. In this context, the Covid-19 pandemic has exposed the precarious conditions of a large number of Chinese workers, and called for further reform to construct a modern universal social welfare system, not only adapted to the dual labor market structure, but also adjusted to suit a new labor landscape after the Covid-19.

A Structural Analysis of Mental Health and Labor Market Trajectories

We conduct a joint dynamic analysis of individual labor market and mental health outcomes. We allow for a two-way interaction between work and mental health. We model selection in and out of employment as well as between jobs on a labor market with search frictions, where we account for the level of exposure to stress in each job using data on occupational health contents. We estimate our model on British data from Understanding Society combined with information from O*NET. We produce structural estimates of health dynamics as a function of job characteristics and of the effects of health and of job stress content on labor market decisions. We use our model to quantify the effects of job loss or health shocks that can propagate over the life cycle through both health and work channels. We also estimate the (large) values workers attach to health, employment or non-stressful jobs. Lastly, we investigate the consequences of structural labor market changes by evaluating the impact on health, employment and inequality of changes in the distribution of job health contents.

Digitalization and modernization of the National Employment Policy

The presented study identifies the channels through which digital transformation affects the system of socio-economic relations, particularly relations associated with employment, and substantiates the transformations in the system of government regulation caused by digitalization.Aim. The study aims to develop proposals to improve the national economic policy in the field of employment regulation with allowance for the current and future challenges of digitalization and the experience of developed (in terms of information technology) countries.Tasks. The authors provide a brief description of the modern revolution in information technology manifested in the form of large-scale digitalization of socio-economic relations; assess the speed, focus, and problems of development of the digital sector of economy in Russia in comparison with other countries; determine the scale and channels through which digitalization affects the well-being and employment of the population; propose directions for improving the national economic policy in the field of employment regulation with allowance for Russian peculiarities.Methods. This study uses the methods of institutional, structural, and statistical analysis with regard to digital transformation processes and in the context of the examination of changes in the socio-economic system and employment structure. The problems of the impact of digital transformations on socio-economic relations are examined using a systems approach and the methodology of comparative analysis and benchmarking — in a comparative analysis of the situation in Russia and other countries. Results. The authors believe digitalization to be a new trend that determines the direction of socioeconomic development in the medium term. In terms of the level of digitalization, Russia is significantly lagging behind developed and many developing countries, which impairs the sustainability of the national economy and national economic security. At the same time, the existing lag allows us to critically study the foreign experience of large-scale digitalization, particularly in terms of its impact on the labor market, employment, and social structure, to form an efficient national policy for regulating the digital transformation of the economy and society. The study proposes several directions aimed at early recognition and neutralization of the potential negative effects of digitalization on the Russian socio-economic system.Conclusions. It is advisable to improve the national economic policy in the field of employment regulation and related fields with allowance for the current and future challenges of digitalization and the experience of developed (in terms of information technology) countries with a focus on certain areas, such as taking into consideration the prospective requirements of the labor market for “future specialists” (creativity, humanistic orientation of thinking and actions, leadership skills, psychological stability, cognitive flexibility, etc.) when developing and updating educational standards, and paying more attention to the development of continuous education. It is also necessary to strengthen government support for self-employment and individual entrepreneurship as legal forms serving as substitutions for hired labor in the digital economy, taking into account the “forced” (in some cases) nature of such entrepreneurship, which calls for government support in both economic and social terms. Convergence of the national policy in the field of social protection and social security with business policy plays an important role, as does the prevention of digital inequality and its “fusion” with traditional property and income inequality.

Differences in wage determination in the Eurozone: A challenge to the resilience of the common currency

Different developments in wages and unit labor costs across countries can reduce the synchronization of business cycles within a currency area and therefore be a potential source of asymmetric shocks and/or asymmetric response to a common shock. In this paper, we use novel econometric methods to identify differences and similarities in wage determination across Eurozone countries. Results show that wages have different determinants across euro area countries, among which two relatively distinct groups can be identified. In particular, wages in Germany, Austria, Belgium, Luxembourg, the Netherlands and Finland behave more similarly, are less sticky and respond more to macroeconomic conditions than those in the group composed of Italy, Spain, Portugal, France and Ireland. Moreover, the equilibrium wage has been affected by a structural change contemporaneous to the international financial crisis. Finally, structural reforms since the euro crisis have contributed to make labor market structures in Eurozone countries more similar, which contributed to improve the resilience of the Eurozone, but the job is not completed yet.

A gendered resource curse? Mineral ownership, female unemployment and domestic violence in Sub-Saharan Africa

Several studies suggest that the extractive industry has negative consequences for gender equality despite the often positive growth impact of natural resources. We re-examine this claim at the sub-state level in sub-Saharan Africa and argue that we need to differentiate between ownership arrangements in the extractive industry. To test our argument on the gender dimension of the resource curse, this article employs unique data on the control rights of minerals within sub-Saharan countries as well as data from Afrobarometer and Demographic and Health Surveys (DHS). Our quantitative analyses explore how international vs. domestic ownership of copper, diamond and gold mines affects the labor market integration of females and intimate partner violence. The regression results suggest in line with our theoretical expectations that gender-specific structural labor market shifts within extractive industries are contingent on mineral control rights. Our models show that within mining areas, only domestic ownership reduces male unemployment. While domestic mining seems to reinforce the traditional male breadwinner model, internationally owned mineral extraction induces structural labor market changes: women abandon subsistence farming activities and migrate to the service sector. Our results further indicate that this shift of traditional gender roles within rural mining areas is associated with less intimate partner violence.

Decomposing polarisation across developing countries: case study of China, India, and Indonesia

We investigate the contributions of various factors in the differences in polarisation across China, India, and Indonesia using micro‐simulation and decomposition methods. Using household expenditure from harmonised data from these countries, China was found to have the highest polarisation, while India has the lowest. Using India as the base country, the differences in the labour market structures in India and Indonesia have a slightly decreasing effect on polarisation. The effects of the differences in demographic composition and expenditure structures/parameters, however, are uncertain. Further, the differences in polarisation between China and Indonesia can be explained mostly by the differences in the expenditure structures. China's expenditure structure tends to increase polarisation, as evidenced by the resulting reduction in the size of the middle class.

The effect of labour market polarization on university students’ job market‐related outcomes in the Republic of Korea: Implications for youth unemployment

AbstractThis article aims to assess the effect of the labour market environment on university students’ labour market‐related behaviour in the Republic of Korea. Using data from the country's Graduates Occupational Mobility Survey for 2005–13, the author estimates the effect of macroeconomic variables on university students’ job market‐related outcomes. Results indicate that labour market polarization, as measured by the labour market polarization index developed by Chung and Jung (2016), has a significant effect on both the nominal and masked (through extension of university enrolment and university transfers) unemployment of university students. These findings imply that the labour market structure is a key element in understanding youth unemployment.

Domestic demand-based economic globalization and inclusive growth

Purpose The purpose of this paper is to propose policy recommendations that resort to the domestic market to achieve inclusive growth from an open perspective. Design/methodology/approach How will economic globalization based on domestic demand affect economic growth and income distribution in an open and large country? With the aim of discussing the mechanism of the impact of expanding domestic demand on the inclusive growth from an open perspective, this paper incorporates the Global Value Chains vs National Value Chains (GVC-NVC) competition, which is triggered by foreign investments attracted by the domestic demand scale into an endogenous growth model with “Schumpeterian Innovation.” Findings Theoretical analysis indicates the following findings: although domestic demand-based economic globalization can promote transnational inclusive growth across countries, it is not conducive to national (domestic) inclusive growth; the impacting effect of domestic demand scale on inclusive growth across countries is subject to the moderating effect of the development maturity of the labor market; and the impacting effect of domestic demand scale on national inclusive growth is subject to the joint moderating effect of the development maturity of the labor market and labor skill structure. Originality/value First, this paper examines the impact of domestic demand-based economic globalization on the inclusiveness of economic growth from an open perspective, which deepens the existing theory of intra-product specialization and inclusive growth. Second, the paper puts the sequential production process into Schumpeterian growth model and reveals the mechanism that domestic demand affects inclusive growth. Third, the study finds that the enhancement of labor market efficiency, transfer payments to low-skilled labor and the creation of a fair competitive market environment will contribute to the globalization of a domestic demand-oriented economy, which provides a policy-making basis for government sectors.

Labor markets and cultural values: Evidence from Japanese and American views about caregiving immigrants

AbstractOne overlooked reason for the persistence of distinct cultural values across rich democracies, we argue, is a country's labor market structure. Parents seeking to position their children for long‐term success would do well to instill values consistent with requirements of the labor market in the country where their children are likely to work. To the extent that labor markets are fluid, as in the United States, parents should teach their children to be resourceful and creative. In countries like Japan with relatively rigid labor markets, where workers have one chance to land a long‐term contract with a leading company, parents instead should instill the values of hard work and respect for authority. We find evidence consistent with this argument in survey experiments about attitudes in the United States and Japan about the desirability of employing immigrants for care work, and what values the immigrant care workers should hold. We also find evidence of indirect norm creation. American and Japanese respondents prefer immigrants—not just caregiving immigrants—whose values align with their country's type of valued human capital.

Immigrant business proprietors in England and Wales (1851–1911)

AbstractThis article examines the history of immigrant business proprietors in England and Wales between 1851 and 1911. The newly available electronic version of the Census (I-CeM) allows all business proprietors in each Census year to be identified, and provides birthplace information that allows entrepreneurs from different countries to be compared to each other and to business proprietors born in the United Kingdom. Immigrant populations had higher rates of business proprietorship than the English and Welsh-born population. This article argues that this was caused by labour market structure and demography rather than cultural differences between English- and foreign-born business proprietors.

A Probe into the Wages and Salaries of Health Economics, Outcomes Research, and Market Access Professionals.

To estimate the central tendency and spread of health economics, outcomes research, and market access (HE/OR/MA) professionals' wage-and-salary earnings; compare male versus female and US versus non-US earnings levels; and examine inequality in their distribution. Self-reported survey data were collected in 2015 from HE/OR/MA professionals in the HealthEconomics.com global subscriber list. The study design consisted of a two-way classification model with multiple replications and three inequality indicators. HE/OR/MA professionals from the HealthEconomics.com global subscriber list completed a questionnaire. The sample consisted of 403 participants. Within each location, men earned higher wages and salaries than women, and within each gender, HE/OR/MA professionals living in the USA earned higher wages and salaries than those living outside the USA. Evidence of a gap was suggested by the presence of gender and location disparities in earnings determinants. Results also suggested the presence of moderate inequality that was similar for both genders and greater for non-US than US residents. This study shed light into the labor market structure of HE/OR/MA professionals and may be conducive to more rational and efficient workforce management policies.

The Youth Labour Market, Populism and the Digitalization of Economies

Firstly, a basic understanding of economic competition and its role in the lives of the youth is presented. Then two forces are described which have affected the lowest echelons of the labour competition market during the last decade and the political reactions (xenophobic, anti–system) which ensued. Finally, some ideas are summarized which were presented at the discussion on the competitive impact of artificial intelligence (AI) on the labour market, some of the responses proposed and the basic difficulties that affect them. We conclude that one must expect further political convulsions following infringements of the AI upon the structure of the youth labour market.

A evolução da precariedade nos mercados de trabalho regionais no Brasil e no México: uma abordagem a partir da análise de componentes principais e de dados em painel

O objetivo deste artigo é avaliar como a precariedade nos mercados de trabalho regionais do Brasil e do México evoluiu entre 2012 e 2017 e quais foram os fatores que impactaram sua incidência. Para atingir este objetivo foi proposto um índice de precariedade do mercado de trabalho construído através da análise de componentes principais. Este índice foi utilizado para ver como a precariedade evoluiu nos mercados de trabalho regionais de ambos os países e também como uma variável dependente em um modelo de efeitos fixos two-way, usado para avaliar se as condições dos mercados de trabalho, suas estruturas e o sistema de regulação do trabalho influenciam o nível de precariedade. Os resultados para o índice mostram que a precariedade cresceu nos estados do México e caiu nos estados do Brasil no período, em geral. O principal motivo para este resultado pode ter sido a reforma trabalhista mexicana de 2012, uma vez que mesmo com as condições do mercado de trabalho mais desfavoráveis no Brasil, a manutenção de uma legislação trabalhista protetiva pode ter contido o avanço da precarização.