UK Labour Force Survey Research Articles

The Underemployed: Evidence From the UK Labour Force Survey for a Conditionally Gendered Top-down Model

The Underemployed: Evidence From the UK Labour Force Survey for a Conditionally Gendered Top-down Model

The impact of parental income and education on the schooling of their children

Abstract We investigate the relationship between early school-leaving and parental education and paternal income using UK Labour Force Survey data. OLS estimation reveals modest effects of income, stronger effects of maternal education relative to paternal, and stronger effects on sons than daughters. Using IV to simultaneously model the endogeneity of parental education and income, the maternal education effect disappears, while paternal education remains significant but only for daughters. In our favourite specification, which proxy for permanent income, paternal income becomes insignificant. Thus policies alleviating income constraints to alter schooling decisions may not be as effective as policies which increase permanent income. JEL codes I20; J62

Working in Old Age in the UK

In summer of 2013, the Office for National Statistics (ONS) reported a record of more than one million people aged 65 or more being in employment in the UK. This represents a doubling relative to 1992 (when ONS began recording this statistic) and means almost one in ten people aged over 65 are employed. Part of the growth can simply be ascribed to demographics (a growing elderly population). Against the upward trend, we should also note a historical decline in work at older ages dating from the 1970s. Using data from the UK Labour Force Survey (LFS) and based on the statistical decomposition proposed by Blundell, Bozio and Laroque (2013), we examine the trends for working in old age between 1975 and 2012. We seek to contrast the increased prevalence of working in old age seen since the early 2000s with the historical decline in later-life employment from the mid-1970s; and to understand how these trends have been driven by:a. Participation in the labour market – the decision on whether to work.b. The number of hours worked by the employed – the intensity of work and the extent of part-time employment.Average hours worked in the economy can then change due to new trends in labour force participation or in the number of hours worked per employee. Whether the increase in employment of the elderly is having as dramatic an impact on the economy as the figures above suggest, depends on the intensity of work.

Older workers and working time

Abstract Contrary to much of the established literature, this paper finds that though many older workers would prefer to reduce their working hours (the overemployed), there is a significant group who would like to work longer hours (the underemployed). And contrary to the assumption that the self-employed are more easily able than employees to select a desired combination of hours and the wage rate, this paper finds that older self-employed workers are more likely to wish to adjust their hours, both upward and downward than are employees. A new index of underemployment is used to show that for the UK, since the onset of the Great Recession, underemployment among older workers has been growing more rapidly than unemployment. Using longitudinal data from the UK Labour Force Survey, the paper investigates the effects of overemployment and underemployment on transitions from employment and self-employment into other labour market states. It confirms that overemployment is a significant predictor of retirement among employees while underemployed employees are less likely to retire.

A regional analysis of flows into and out of the UK national minimum wage

This article utilizes the panel element of the UK Labour Force Survey (LFS) to identify for individual regions total inflows and outflows and hazards for those individuals paid at or below the National Minimum Wage (NMW). In particular, it examines the extent and direction of the correlation between low-pay inflows and outflows and the economic cycle. Further, it examines the impact of regional variations in the bite of the NMW on regional flows into and out of the NMW.

Welfare participation by immigrants in the UK

PurposeThe purpose of this paper is to examine the welfare participation of immigrant groups in the UK, which has experienced a large growth in its immigrant flows and population levels in recent years, especially following EU enlargement in 2004. The analysis particularly focuses on the types of benefits that immigrants tend to claim, as well as examining differences by area of origin. It also examines the factors that determine social assistance benefit claims, including an investigation of the impact of education, ethnicity and years since migration.Design/methodology/approachA series of probit regression models are estimated using data from the UK Labour Force Survey collected between 2004 and 2009.FindingsSocial welfare claims vary considerably by immigrant group as well as by the type of benefit claimed in the UK. There are also differences by immigrant group in the factors determining social assistance claims.Research limitations/implicationsIt is very difficult to generalise on the issue of welfare participation by immigrants in the UK. This is important, given policy changes towards migrants from non‐EU countries and in relation to welfare reforms.Originality/valueThe limited previous work in this area for the UK has tended to analyse all benefit claims made by immigrants as a whole, whereas this analysis splits immigrants into different groups and focuses on the types of benefits that are claimed. This has important implications, particularly given the recent increase in immigration to the UK.

Growth and Recession: Underemployment and the Labour Market in the North of England

This paper assesses the recent employment history of the North of England and its constituent sub-regions and cities within the context of broader trends in the UK and of major policy changes in the last 2 years. The paper draws on previous surveys of the employment performance of the North and on recent statistics on Job Seeker’s Allowance, and underemployment estimates based on the Special License UK Labour Force Survey. The paper describes the performance of the North during the long boom (1996 to 2006), and examines changes in the pattern of employment following the 2008/9 recession. Logistic regression is used to explore patterns of involuntary part time employment, broader time-related underemployment, and general and graduate level over-education. The findings reveal that beyond relatively higher levels of unemployment, several of the sub-regions and cities of the North of England also suffer comparatively high levels of underemployment and over-education, suggesting a potential under-utilisation of skills in the Northern regions.

Location, Vocation, Location? Spatial Entrapment among Women in Dual Career Households

This paper explores spatial entrapment among women. The analysis contributes to the debate concerning the spatial entrapment thesis, advancing research through application of a mixed method empirical approach, and focus on dual career households in the UK. Data from the UK Labour Force Survey Household Data‐Set is combined with a recent case study of Greater Nottingham, England. The empirical findings are indicative of relative equality between career men and women in hours worked for an employer, particularly in professional occupations. But, while a level of equality is present in many workplaces, gender inequity within the home persists. Women, on average, work closer to their place of residence. School age dependent children present a particular constraint. Women are spatially entrapped by household responsibilities, with potentially severe career implications. Redressing this inequity within the household, however, represents a major challenge for future policy.

Older Workers and Working Time

Contrary to much of the established literature, this paper finds that though many older workers would prefer to reduce their working hours (the overemployed), there is a significant group who would like to work longer hours (the underemployed). And contrary to the assumption that the self-employed are more easily able than employees to select a desired combination of hours and the wage rate, this paper finds that older self-employed workers are more likely to wish to adjust their hours, both upward and downward than are employees. A new index of underemployment is used to show that for the UK, since the onset of the Great Recession, underemployment among older workers has been growing more rapidly than unemployment. Using longitudinal data from the UK Labour Force Survey, the paper investigates the effects of overemployment and underemployment on transitions from employment and self-employment into other labour market states. It confirms that overemployment is a significant predictor of retirement among employees while underemployed employees are less likely to retire.

Population Average Gender Effects

In this paper I develop a consistent estimator of the population average treatment effect (PATE) which is based on a nonstandard version of the Oaxaca–Blinder decomposition. As a result, I extend the recent literature which has utilized the treatment effects framework to reinterpret this technique, and propose an alternative solution to its fundamental problem of comparison group choice. I also use the Oaxaca–Blinder decomposition and its semiparametric extension to decompose gender wage differentials with the UK Labour Force Survey (LFS) data, while providing separate estimates of the average gender effect on men, women, and the whole population.

Occupational Characteristics, Occupational Sex Segregation, and Family Migration Decisions

ABSTRACTThis paper examines the effects of occupational characteristics on family migration within Britain. For the first time in the literature, we explicitly theorise and later test the impact of the sex composition of husbands' and wives' occupations on mobility decisions. The empirical analysis consists of panel regression models estimated on dyadic couple‐level information from the British Household Panel Survey combined with occupational‐level data from the UK Labour Force Survey. Results suggest that some occupational characteristics are significantly associated with family migration, whereas occupational sex segregation has limited impact. Although working in female‐dominated occupations is related to a lower propensity to become a lead mover and a higher propensity to become a tied mover, these associations are mediated by the socio‐economic and occupational characteristics of the spouses. Copyright © 2012 John Wiley & Sons, Ltd.

Funding higher education and wage uncertainty: Income contingent loan versus mortgage loan

We propose a simple theoretical model which shows how the combined effect of wage uncertainty and risk aversion can modify the individual willingness to pay for a HE system financed by an ICL or a ML. We calibrate our model using real data from the 1970 British Cohort Survey together with the features of the English HE financing system. We allow for individual heterogeneity by considering different family backgrounds and occupations. We find that graduates from poor families, males and graduates working in the private sector are more willing to pay to switch to an ICL. Using the UK Labour Force Survey we evaluate the distributive effects of our model. We compute the repayment burdens and taxpayer subsidies for average, low and high earnings graduates. The results confirm the important insurance benefits of an ICL compared to a ML, with lower burdens and higher subsidies for poorer graduates.

Occupational cancer in Britain

To estimate the current occupational cancer burden due to past exposures in Britain, estimates of the number of exposed workers at different levels are required, as well as risk estimates of cancer due to the exposures. This paper describes the methods and results for estimating the historical exposures. All occupational carcinogens or exposure circumstances classified by the International Agency for Research on Cancer as definite or probable human carcinogens and potentially to be found in British workplaces over the past 20–40 years were included in this study. Estimates of the number of people exposed by industrial sector were based predominantly on two sources of data, the CARcinogen EXposure (CAREX) database and the UK Labour Force Survey. Where possible, multiple and overlapping exposures were taken into account. Dose–response risk estimates were generally not available in the epidemiological literature for the cancer–exposure pairs in this study, and none of the sources available for obtaining the numbers exposed provided data by different levels of exposure. Industrial sectors were therefore assigned using expert judgement to ‘higher’- and ‘lower’-exposure groups based on the similarity of exposure to the population in the key epidemiological studies from which risk estimates had been selected. Estimates of historical exposure prevalence were obtained for 41 carcinogens or occupational circumstances. These include exposures to chemicals and metals, combustion products, other mixtures or groups of chemicals, mineral and biological dusts, physical agents and work patterns, as well as occupations and industries that have been associated with increased risk of cancer, but for which the causative agents are unknown. There were more than half a million workers exposed to each of six carcinogens (radon, solar radiation, crystalline silica, mineral oils, non-arsenical insecticides and 2,3,7,8-tetrachlorodibenzo-p-dioxin); other agents to which a large number of workers are exposed included benzene, diesel engine exhaust and environmental tobacco smoke. The study has highlighted several industrial sectors with large proportions of workers potentially exposed to multiple carcinogens. The relevant available data have been used to generate estimates of the prevalence of past exposure to occupational carcinogens to enable the occupational cancer burden in Britain to be estimated. These data are considered adequate for the present purpose, but new data on the prevalence and intensity of current occupational exposure to carcinogens should be collected to ensure that future policy decisions be based on reliable evidence.

Ethnic networks and employment outcomes

This paper explores the relationship between residential proximity of individuals from the same ethnic group and the probability of finding a job through social networks, relative to other search methods. Using individual-level data from the UK Labour Force survey and spatial statistics techniques, we find that (i) the higher is the percentage of a given ethnic group living nearby, the higher is the probability of finding a job through social contacts; (ii) this effect decays very rapidly with distance. The magnitude, statistical significance and spatial decay of such an effect differ depending on the ethnic group considered. We provide an interpretation of our findings using the network model of Calvó-Armengol and Jackson (2004).

Job Creation and Regional Change under New Labour: A Shift-Share Analysis

The paper examines changes in UK regional employment during the period of the New Labour administration, 1997–2010, with the Blair and Brown administrations considered separately. The paper employs a shift-share analysis of workplace employment data by industry and subregion, using annual data from the UK Labour Force Survey. The results reveal significant regional shifts, with interesting spatial dynamics in and around the capital and resilient employment growth in the provinces.

Interpreting Wage Gaps of Disabled Men: The Roles of Productivity and of Discrimination

Using the UK Labour Force Survey, we study wage gaps for disabled men after the introduction of the Disability Discrimination Act. We estimate wage gaps at the mean and at different quantiles of the wage distribution and decompose them into a part explained by differences in workers' and job characteristics, a part that can be ascribed to health‐related reduced productivity, and a residual part. The large original wage gaps reduce substantially when we control for differences in education and occupation, although significant residuals remain. However, when we isolate productivity differences between disabled and nondisabled workers, the residual wage gap becomes insignificant in most cases.

Measuring the UK's human capital stock

Estimates of the UK's stock of human capital are derived by applying a lifetime labour income methodology to data from the UK Labour Force Survey. The results show that using an annual discount rate of 3.5 per cent and assuming annual labour productivity growth of 2 per cent, the market value of the UK's human capital stock in 2009 was £16,686 billion. This is more than two‐and‐a‐half times the Blue Book estimate of the Net Worth of the UK for the same year and £2,703 billion higher than the estimate for the human capital stock in 2001. In 2009, the average human capital stock per head of working age population was £419,326. This is £46,797 higher than in 2001 but only £717 higher than in 2007. Less time in paid employment over their lifetime and lower average labour market earnings means that the total market value of women's human capital (£6,481 billion) was around 63 per cent of men's (£10,206 billion). In 2009, one‐third of the human capital stock was embodied in the 21.7 per cent of the working age population whose highest educational attainment was a degree or equivalent.

Reality of On-the-Job Search

This paper provides a set of simple, yet overlooked, facts regarding on-the-job search and job-to-job transitions using the UK Labour Force Survey (LFS). The LFS is unique in that it asks employed workers whether they search on the job and, if so, why. I find that workers search on the job for very different reasons, which lead to different outcomes in both mobility and wage growth. A nontrivial fraction of workers engage in on-the-job search due to a fear of losing their job. This group mimics many known features of unemployed workers, such as wage losses upon finding a job. Workers also search on the job because they are unsatisfied. This group is roughly equally split into those who are unsatisfied with pay and those who are unsatisfied with other aspects of their job. Distinguishing these two groups allows me to highlight the importance of the nonpecuniary value of a job. I further show that the evidence that firms make a counteroffer in response to a worker’s outside offer is scarce and that wage outcomes at the time of job-to-job transitions are closely linked to the worker’s outside option. The evidence in this paper contributes not only to deepening our understanding of labor reallocation, but it also suggests the fruitful directions of future research in the labor search literature.

Differences by Degree: Evidence of the Net Financial Rates of Return to Undergraduate Study for England and Wales

This paper provides estimates of the impact of higher education qualifications on the earnings of graduates in the UK by subject studied. We use data from the recent UK Labour Force Surveys which provide a sufficiently large sample to consider the effects of the subject studied, class of first degree, and postgraduate qualifications. Ordinary Least Squares estimates show high average returns for women that does not differ by subject. For men, we find very large returns for Law, Economics and Management but not for other subjects ﾖ we even find small negative returns in Arts, Humanities and other Social Sciences. Quantile Regression estimates suggest negative returns for some subjects at the bottom of the distribution, or even at the median. Degree class has large effects in all subjects suggesting the possibility of large returns to effort. Postgraduate study has large effects, independently of first degree class. A large rise in tuition fees across all subjects has only a modest impact on relative rates of return suggesting that little substitution across subjects would occur. The strong message that comes out of this research is that even a large rise in tuition fees makes little difference to the quality of the investment ﾖ those subjects that offer high returns (LEM for men, and all subjects for women) continue to do so. And those subjects that do not (especially OSSAH for men) will continue to offer poor returns. The effect of fee rises is dwarfed by existing cross subject differences in returns.

Disability, employment and earnings: an examination of heterogeneity

This article uses information from an ad hoc module on disability in the 2002 UK Labour Force Survey to identify the heterogeneity that exists within the disabled group and examine its impact on labour market outcomes. After controlling for a range of personal characteristics, the type, severity, duration and cause of the disability are found to be important determinants of employment, but there is less evidence to support the influence of within group heterogeneity on earnings.