Unemployment Disparities Research Articles

Distribuição de qualificações profissionais e disparidade regional de desemprego na Hungria

In this paper we address the empirical question whether the skill distribution of regions has a permanent effect on regional unemployment rates. We argue that if technology and skill are complements and workers with different skills are poor substitutes, the uneven spatial distribution of human capital plays an important role in shaping regional unemployment rate differentials. When the adaption and application of technology need skilled workers, the inflow of technology raises the skill premium and attract skilled workers, which in turn also ameliorate low-skilled unemployment, if skilled and unskilled workers are not perfect substitutes in the production process, or the higher share of skilled workers in the traded sector increase the demand for unskilled labor in the local non-traded sector. Empirical evidence from the Hungarian post-socialist transition confirms the hypothesis that the uneven distribution of skills inherited from the socialist era had a major and permanent influence on the emergence of regional unemployment disparities, which prevailed even after the end of transition through the inward flow of technology through FDI and the spatial concentration of economic activity. Regression estimates show that the share of college educated individuals has a strong negative effect on regional unemployment. However this is not only the result of the initially lower risk of unemployment among college educated individuals but also the complementarity between different skill levels. Separate estimates on skill-specific unemployment rates show that an increase in the percentage share of college graduates abates the unemployment rate of lower skilled workers.

Decomposition Analysis to Identify Intervention Targets for Reducing Disparities.

There has been considerable interest in using decomposition methods in epidemiology (mediation analysis) and economics (Oaxaca-Blinder decomposition) to understand how health disparities arise and how they might change upon intervention. It has not been clear when estimates from the Oaxaca-Blinder decomposition can be interpreted causally because its implementation does not explicitly address potential confounding of target variables. While mediation analysis does explicitly adjust for confounders of target variables, it typically does so in a way that effectively entails equalizing confounders across racial groups, which may not reflect the intended intervention. Revisiting prior analyses in the National Longitudinal Survey of Youth on disparities in wages, unemployment, incarceration, and overall health with test scores, taken as a proxy for educational attainment, as a target intervention, we propose and demonstrate a novel decomposition that controls for confounders of test scores (e.g., measures of childhood socioeconomic status [SES]) while leaving their association with race intact. We compare this decomposition with others that use standardization (to equalize childhood SES [the confounders] alone), mediation analysis (to equalize test scores within levels of childhood SES), and one that equalizes both childhood SES and test scores. We also show how these decompositions, including our novel proposals, are equivalent to implementations of the Oaxaca-Blinder decomposition but provide a more formal causal interpretation for these decompositions.

Overcoming Spatial Mismatch: The Opportunities and Limits of Transit Mode in Addressing the Black–White Unemployment Gap

Spatial inequality is a central characteristic of U.S. metropolitan areas. Overcoming related employment disadvantages requires a broad set of responses: relocation, economic development, or an increase in mobility. Given the difficulty of widespread relocation or urban rebuilding programs, increasing mobility through transportation options may be a core solution in the short term. This article explains the racial gap in unemployment under spatial mismatch in the largest metropolitan areas by examining racial gaps in automobile access and public transit use. Research questions focus on which transit options are important to negotiate spatial mismatch and whether there are racial differences in the transit effect. Presented are descriptive and multivariate analyses using 2000 data from the U.S. Census, the Economic Census, and the Zip Code Business Pattern files. Findings show that comparatively, automobile access dominates the public transit effect on Black and White male unemployment in the 100 largest MSAs. First–difference analyses show that Black/White gaps in automobile access correlate with greater racial unemployment disparities, while racial gaps in public transit access seem to be associated with lower racial disparities in unemployment.

The Merits of Specialized Microfinance Instruments and Their Feasibility in Alleviating Poverty in Albany-Dougherty County, Georgia

Albany-Dougherty County, Georgia has poverty-related indexes that include unemployment and economic disparity. The high unemployment and deteriorating economic climate can be traced to an exodus of major manufacturing employers. Public health issues and educational services continue to decline. These proxies of misery must be addressed by a contemporary mix of market related factors of financing and entrepreneurial enthusiasm. This research addresses the ever increasing poverty and related challenges on the road to prosperity. Secondly, this exploratory study highlights the relevance of a mix of micro-financing instruments that could assist the community to engage market-based economic activities that could enhance economic profiles. Based on the data collected with a survey instrument, the study highlights an apparent reluctance of concessionary financial institutions to lend.

Regional unemployment disparities in China

China has larger regional unemployment disparities than any other economy of comparable size. The persistence of the unemployment disparity in China has prevented the aggregate unemployment rate from decreasing even when the country’s GDP was growing at 10 percent per year. Unemployment rates rose and unemployment disparities widened in other transition economies too, but what made China’s disparities wider than those in other transition economies is the existence of a large subsistence sector, where unemployment exists only in a disguised form. This study explains the wide unemployment disparity in China with the geographically uneven distribution of the three sectors: the state sector, which suffers from a steep rise of unemployment during transition; the capitalist sector, which absorbs labor from the subsistence sector and grows rapidly; and the subsistence sector, which supplies its redundant labor to the capitalist sector. The study also presents a case study of Fuxin City, which has experienced an extremely high unemployment rate due to the reform of its main industry. Fuxin’s case is presented as a microcosm of the problems that give rise to unemployment disparities, such as massive layoffs in the state sector, lack of labor mobility in the unemployment-stricken regions, and inadequate development of the capitalist sector.

CLOSING THE GAP: WHY MINIMUM WAGE LAWS DISPROPORTIONATELY HARM AFRICAN-AMERICANS

Why are black unemployment rates higher than those of whites?1 Common explanations include racism, lack of representation in government, or the market as an oppressive institution. All of these explanations fail: minimum wage laws are the real culprit. States Sowell (2015) in this regard:Low-income minorities are often hardest hit by the unemployment that follows in the wake of minimum wage laws. The last year when the black unemployment rate was lower than the white unemployment rate was 1930, the last year before there was a federal minimum wage law. ... 'Incidentally, the black-white gap in unemployment rates for 16-year-olds and 17-year-olds was virtually nonexistent back in 1948. But the black teenage unemployment rate has been more than double that for white teenagers for every year since 1971. This is just one of many policies that allow liberals to go around feeling good about themselves, while leaving havoc in their wake. 'Section 1 considers three possible causes of the unemployment disparity, and ultimately rejects all of them. Section 2 provides a brief general history of minimum wage laws. Section 3 covers theoretical considerations of labor economics. Section 4 criticizes the prevailing wisdom that minimum wage laws, even if ineffective, are the result of well-meaning social advocates. Instead the history of these laws is one of deliberate collusion on the part of unions, particularly in an effort to disparage minorities and immigrant workers. Section 5 offers possible solutions to the gap in marginal productivity. Section 6 concludes.1. Three Possible Causes of the Unemployment DisparityThe most common explanation given for the high black unemployment is discrimination. The hypothesis is that employers fail to hire blacks because they harbor feelings of ill-will towards minorities. This seemingly plausible hypothesis fails to square with empirical data. Given that both legal and social standing for African-Americans improved steadily throughout the second half of the 20th century, the discrimination hypothesis would predict that the ratio of black to white unemployment would steadily fall concomitantly with the diminution of racist attitudes. The repeal of Jim Crow Laws, the Separate but Equal Clause, and the enactment of the various Civil Rights Acts all suggest that employment conditions for blacks would improve during this period.The death knell for this hypothesis is that the data does not conform to it. In 1975 the black unemployment rate was 14.8 percent, while the white unemployment rate was 7.8 percent. The black to white unemployment ratio was thus less than two (Reynolds, 1995: 43). Yet in each year from 1980 to 1993 this ratio was greater than two (Pew, 2013). If discrimination were the significant factor contributing to black unemployment, then one would expect the data to show the very opposite tendency. The fact that black unemployment increased relative to white unemployment during this period shows that discrimination is at best a very weak factor in explaining black unemployment. More accurately, the one cannot possibly be the cause of the other.Another possible explanation for high rates of black unemployment is the relative absence of members of this community in Congress. This branch of government writes the laws, after all, and therefore sets the rules of the game. Blacks are underrepresented in Congress, so perhaps their employment interests are denigrated. This hypothesis fails for the same reason as the one about discrimination - the data fails to support it. While it is true that blacks are still underrepresented in Congress, this disproportion fell during the same period that the black to white unemployment ratio rose. Subsequently, the number of African American Members steadily increased. In the 98th Congress (1983-1985), the number surpassed 20 for the first time and in the 103rd Congress (1993-1995) reached 40 (Manning). The underrepresentation hypothesis would predict that black to white unemployment would fall as a consequence of black gains in Congress, but the data do not bear this out. …

What drives unemployment disparities in European regions? A dynamic spatial panel approach

ABSTRACTWhat drives unemployment disparities in European regions? A dynamic spatial panel approach. Regional Studies. This study analyzes unemployment differentials in European regions during the period 2000–11. To that end, a theoretical model with substantive spatial interactions among regions is developed. The solution implies a dynamic-spatial Durbin model specification including regional and institutional-level factors as explanatory variables. In conjunction with dynamic-spatial panel estimates, relative importance metrics are used to quantify the effect of regional disequilibrium, equilibrium and national-level factors. Relative importance analysis suggests that during the pre-crisis period, unemployment disparities were mainly driven by regional-level equilibrium factors. Nevertheless, labour market institutions are of major importance to explain increasing disparities during 2009–11.

A regional unemployment model simultaneously accounting for serial dynamics, spatial dependence and common factors

Regional unemployment rates tend to be strongly correlated over time, parallel the national unemployment rate, and be correlated across space. We address these key stylized facts by linking different strands of literature into a unified methodology to investigate regional unemployment disparities. This methodology simultaneously accounts for serial dynamics, spatial dependence and common factors, also known as weak and strong cross-sectional dependence. We apply this approach using provincial level data for the Netherlands. The substantial and persistent division between high and low unemployment clusters makes it an interesting case, and data availability since the early 1970s enables a comparison between prior periods of downturn and recovery to the recent economic crisis. It is found that approaches that do not simultaneously account for serial dynamics, spatial dependence and common factors, or that ignore one of these issues, may lead to biased inference.

Polarization or convergence? An analysis of regional unemployment disparities in Europe over time

We analyse the distribution of regional unemployment rates in Europe and its dynamics. Using the standard deviation, non-parametric kernel densities, and stochastic kernels we identify and study two distinct periods: a convergence from 1996 to 2007 and a polarization from 2007 to 2013. We further estimate a multi-level factor model to identify the contributions of continental, country and region-specific fluctuations. We show that the convergence prior to the recent crisis is solely accounted for by country factors, whereas the strong polarization afterwards can be attributed to both country and region-specific fluctuations. In addition, we provide evidence for European unemployment cycles and discuss interesting regional patterns.

Spatial Unemployment Differentials in Colombia

This paper studies the geographic distribution of unemployment rates in Colombian urban areas. It introduces measures of spatial correlation and spatial econometric techniques to analyze the dependence in local unemployment rates across municipalities. Results suggest that Colombian municipalities have experienced a polarization process between 1993 and 2005, as municipalities' unemployment rates have followed different evolutions relative to the National average. This process has been accompanied by the creation of unemployment clusters, that is to say, municipalities had very similar unemployment outcomes to those of their neighbors. This analysis uses a spatial Durbin model to explore the influence of various factors in determining differences in regional unemployment rates. According to our findings differences in labor demand, immigration rates, and urbanization are factors behind observed municipal unemployment disparities.

Workforce location and equilibrium unemployment in a duocentric economy with matching frictions

This article examines unemployment disparities and efficiency in a duocentric city where workers are non-uniformly distributed between the two job centers. We introduce commuting costs and search-matching frictions to deal with the spatial mismatch between workers and firms. In a decentralized economy job-seekers do not internalize a composition externality they impose on all the unemployed. With symmetric job centers, a change in the distribution of the workforce can lead to asymmetric equilibrium outcomes. We calibrate the model for Los Angeles and Chicago Metropolitan Statistical Areas. Simulations suggest that changes in the workforce distribution have non-negligible effects on unemployment rates, wages, and net output, but cannot be the unique explanation of a substantial mismatch problem.

Caractéristiques et déterminants du chômage des jeunes au Cameroun: le rôle prépondérant du diplôme et du sexe

RésuméParadoxalement, le diplôme ne préserve pas les jeunes du chômage qui touche plus les femmes que les hommes sur le marché du travail au Cameroun. A la lumière de ce fait stylisé, l'objectif de cet article est d'analyser les déterminants du chômage des jeunes. En faisant bon usage des micro‐données de la deuxième enquête sur l'emploi et le secteur informel, cette étude va au‐delà de l'analyse logistique simple en adoptant des techniques de décomposition de Blinder et Oaxaca pour analyser les déterminants de l'écart de chômage selon le genre et le diplôme. Les résultats révèlent notamment le rôle déterminant du niveau d'instruction, du sexe féminin et du milieu de résidence dans l'aggravation du chômage des jeunes au Cameroun. Toutefois, l'analyse infirme l'hypothèse de discrimination du genre à l'embauche quand les différences de productivité entre les diplômés et les non diplômés, les avantages liés au diplôme ainsi que les désavantages associés au non diplôme expliquent les disparités de chômage entre ces deux derniers groupes. Ces principaux résultats débouchent sur quelques recommandations de politiques en faveur de la promotion de l'emploi des jeunes.

Intersectional Stigma and the Acceptance Process of Women with Mental Illness

Acceptance of mental illness is facilitated by the presence of various resources that are needed to deal with associated stigma, prejudice, and discrimination. However, women with mental illness experience added levels of stigma and intersectional oppression that affect the acceptance process, including higher rates of victimization, unemployment, poverty, homelessness, and clinical disparities. Practitioners and researchers can benefit from sensitivity to intersectional stigma, or overlapping, multiple levels of stigma and discrimination, faced by women with mental illness. Participant case narratives from a qualitative study will be presented in order to demonstrate the impact of intersectional stigma on the process of acceptance for women with mental illness.

Workforce Location and Equilibrium Unemployment in a Duocentric Economy with Matching Frictions

This article examines unemployment disparities and efficiency in a densely populated economy with two job centers and workers distributed between them. We introduce commuting costs and search-matching frictions to deal with the spatial mismatch between workers and firms. In a decentralized economy job-seekers do not internalize a composition externality they impose on all the unemployed. With symmetric job centers, a change in the distribution of the workforce can lead to asymmetric equilibrium outcomes. We calibrate the model for Los Angeles and Chicago Metropolitan Statistical Areas. Simulations suggest that changes in the workforce distribution have non-negligible effects on unemployment rates, wages, and net output, but cannot be the unique explanation of a substantial mismatch problem.

THE IMPACT OF SKILL‐SPECIFIC MIGRATION ON REGIONAL UNEMPLOYMENT DISPARITIES IN GERMANY

ABSTRACTDifferences in regional unemployment are still pronounced in Germany, especially between eastern and western Germany. Although the skill level seems important for the relationship between regional disparities and labor migration, corresponding empirical evidence is scarce. Applying dynamic panel models, we investigate the impact of labor mobility differentiated by educational attainment of the workers on regional unemployment disparities between 2000 and 2008. The impact of low‐ and medium‐skilled migration is consistent with traditional neoclassical reasoning, suggesting that labor mobility reduces differences in regional unemployment rates. In contrast, the migration of high‐skilled workers tends to reinforce disparities.

Labor market frictions, agglomeration, and regional unemployment disparities

This paper constructs a footloose entrepreneur model with Diamond–Mortensen–Pissarides job search and matching frictions in the manufacturing sector. It captures unemployment adjustment both within the manufacturing sector and in the regional labor market. The within-sector unemployment rate is negatively affected by firm market access and is positively related to the intensity of firm screening among heterogeneous candidate workers. The regional unemployment rate, on the other hand, is related to the sectoral share of job searching across sectors within each region. We find the coexistence of a smaller within-sector unemployment rate and a larger local unemployment rate in the region with firm agglomeration. We also extend the analysis by examining the role of labor market frictions across sectors and the interdependence between agglomeration and unemployment.

Lisa Schur, Douglas Kruse, and Peter Blanck: People with Disabilities: Sidelined or Mainstreamed?

Persons with disabilities represent a significant and increasing proportion of working-age adults worldwide. More governments are recognizing the benefits of fully capturing the skills and abilities of the entire potential workforce, new international agreements now support the rights of persons with disabilities, and rapid technological advancement is providing new opportunities and freedoms. This book addresses these developments, describing the current economic, social, and political situation of persons with disabilities across the world, and the influences that have led to this situation. This highly current, contextual view is especially valuable for occupational rehabilitation researchers and practitioners, eager to understand employment opportunities and barriers for persons with disabilities. Although there has been a recent plethora of books about disability issues, ‘‘Persons with Disabilities’’ is unique in providing both depth and breadth, in a highly accessible format. This gives the reader the necessary background information to appreciate the well-informed concluding section, where leading experts and advocates in the US and UK reflect on the current state, and speculate on what the future holds. The authors begin with a focused, critical review of the difficulties in enumerating who has a disability, and the role of different conceptual models in framing this question. The review of factors that influence self-reporting, and how these factors inter-relate is especially valuable for researchers who contemplate population or workplace studies. The second chapter documents the magnitude and reasons for disparities in unemployment and poverty in

Arbeitslosigkeit und Stellenannahmebereitschaft: Erste Ergebnisse eines Faktoriellen Survey Moduls

Matching individuals to jobs is a fundamental problem in any labour market. This paper focuses on job characteristics, such as wages, job quality, and distance from the current place of residence, and the impact of these characteristics on the willingness of employed and unemployed individuals to accept new job offers. Using an experimental factorial survey module (FSM) implemented in the fifth wave of a large population survey (Panel Study Labour Market and Social Security), the willingness of employed and unemployed labour market participants to accept new job offers was compared while considering job characteristics like gain of income or commuting distance. In this study, unemployed and employed individuals received the same set of hypothetical job offers. Consistent with theoretical arguments, the about 20,000 evaluations provided by about 4,000 respondents showed that unemployed participants generally exhibit a greater willingness to accept new job offers than employed ones. Moreover, unemployed individuals were likely to make more concessions than employed individuals with respect to job quality, such as accepting fixed-term job offers. Interestingly, little evidence for different decision-making or weightings of mobility costs was found, which enables us to conclude that interregional unemployment disparities can scarcely be explained by unemployed individuals lacking the willingness to work or relocate.

The Natural Rate of Unemployment Hypothesis and the Evolution of Regional Disparities in Spanish Unemployment

On both theoretical and empirical grounds, this paper demonstrates that the natural rate of unemployment (NRU) cannot explain the evolution of regional unemployment disparities in Spain. The analytical framework of the chain reaction theory (CRT) of unemployment argues that an interactive labour market system, rather than a single-equation model, is better equipped to accommodate unemployment dynamics and that unemployment does not gravitate towards its NRU due to the interplay of frictions and growth. Two groups of high and low unemployment regions are identified with substantial disparities that remain stable in their composition through time. Evaluating the natural rates for each group of regions, it is confirmed that regional unemployment disparities cannot be attributed to disparities in the NRUs. Thus, instead of focusing on the determinants of the NRU, an appraisal of the contributions of the exogenous variables to the unemployment trajectory should take hold in policy-making.

Agglomeration, congestion, and regional unemployment disparities

Regional labor markets are characterized by huge disparities between unemployment rates. Models of the New Economic Geography explain how disparities between regional goods markets endogenously arise but usually assume full employment. This paper discusses regional unemployment disparities by introducing a wage curve based on efficiency wages into the New Economic Geography. The model shows how disparities between regional goods and labor markets endogenously arise through the interplay of increasing returns to scale, transport costs, congestion costs, and migration. The level and stability of regional labor market disparities depends on the extend of labor market frictions.