Leaders: Gregory Acs, David Card, Michael Hout, Jesse Rothstein
The labor market was of course hit very heavily by the Great Recession, as evidenced by (a) the slow recovery of the unemployment rate, (b) and the even slower recovery of the long-term unemployment rate and the prime-age employment ratio (defined as the ratio of employed 25-54 year-olds to the population of that same age). This “jobs problem,” which is especially prominent among low-skill workers, has led to a sharp rise in the number of poor households without any working adults. It also underlies, in part, the sharp increase in the number of disability insurance claims and awards, which in turn has further reduced the supply of labor among low-skilled individuals.
If the first type of “jobs problem” is that there still are not enough of them, the second is that the jobs that are available do not always provide the requisite hours, wages, or security that are needed for a sure pathway out of poverty. As a result, low-skill individuals are not just working less but, even when they are working, there is no guarantee that their jobs will lift them and their families out of poverty. The Labor Markets RG is tasked with conducting research on these and related problems and exploiting administrative and other data to assess possible policy responses to them. We list below a few examples of the work being carried out in this group.
Long-run effects of work incentives: As nonworking poverty increases, the U.S. might well want to turn to new types of work incentive programs. Have these programs worked elsewhere?
Minimum wages and poverty: Throughout the west coast, there are a host of minimum wage “experiments” underway, experiments that have the potential to reset the low-wage labor market in quite fundamental ways. How are these experiments playing out?
Labor Markets - CPI Research
|The Effect of Unemployment Benefits on the Duration of Unemployment Insurance Receipt: New Evidence from a Regression Kink Design in Missouri, 2003-2013||David Card, Andrew Johnston, Pauline Leung, Alexandre Mas, Zhuan Pei||
The Effect of Unemployment Benefits on the Duration of Unemployment Insurance Receipt: New Evidence from a Regression Kink Design in Missouri, 2003-2013Author: David Card, Andrew Johnston, Pauline Leung, Alexandre Mas, Zhuan Pei
Publisher: American Economic Review
We provide new evidence on the effect of the unemployment insurance (UI) weekly benefit amount on unemployment insurance spells based on administrative data from the state of Missouri covering the period 2003-2013. Identification comes from a regression kink design that exploits the quasi-experimental variation around the kink in the UI benefit schedule. We find that UI durations are more responsive to benefit levels during the recession and its aftermath, with an elasticity between 0.65 and 0.9 as compared to about 0.35 pre-recession.
|Promoting Social and Economic Mobility in Washington, DC||Gregory Acs, Lauren Eyster, Jonathan Schwabish||
Promoting Social and Economic Mobility in Washington, DCAuthor: Gregory Acs, Lauren Eyster, Jonathan Schwabish
Publisher: The Urban Institute
As Mayor Bowser settles into her office, she leads a city that is growing more prosperous. Yet too many DC residents are not sharing in that prosperity. Since the last recession began in 2007, median income in DC has grown by three times the national average, reaching nearly $61,000 in 2013. Yet DC’s unemployment rate persistently remains about 1 percentage point higher than in the nation as a whole. Removing barriers to mobility and creating meaningful opportunities for all DC residents to prosper require various strategies. DC’s new mayor should adopt strategies and policies that can help city residents who struggle the most with becoming and staying connected to the labor market.
|Teacher Quality Policy When Supply Matters||Jesse Rothstein||
Teacher Quality Policy When Supply MattersAuthor: Jesse Rothstein
Publisher: American Economic Review
Teacher contracts that condition pay and retention on demonstrated performance can improve selection into and out of teaching. I study alternative contracts in a simulated teacher labor market that incorporates dynamic self-selection and Bayesian learning. Bonus policies create only modest incentives and thus have small effects on selection. Reductions in tenure rates can have larger effects, but must be accompanied by substantial salary increases; elimination of tenure confers little additional benefit unless firing rates are extremely high. Benefits of both bonus and tenure policies exceed costs, though optimal policies are sensitive to labor market parameters about which little is known.
|Not Enough Work: Access to Full-Time Jobs with Decent Pay and Benefits Varies by Race/Ethnicity and Place of Residence||Marybeth J. Mattingly, Justin R. Young||
Not Enough Work: Access to Full-Time Jobs with Decent Pay and Benefits Varies by Race/Ethnicity and Place of ResidenceAuthor: Marybeth J. Mattingly, Justin R. Young
Publisher: National Agricultural & Rural Development Policy Center
In this brief, we consider differences across rural and urban America in each of these measures, given the very different economic conditions that prevail in rural America, where higher paying jobs and those with employer-provided health insurance areless common (McLaughlin and Coleman-Jensen 2008), nonstandard work is more ubiquitous (McCrate 2011), and the best-educated and young often move away (Carr and Kefalas 2010: Hollowing Out the Middle). Further, we break down these differences by both race and gender, as prior research suggests racial-ethnic differences in underemployment (Glauber 2013; Sum and Khatiwada 2010; Young2012), and we know from the literature that different factors mayinfluence women and men’s employment (see, for example, Hollister 2011). We use data from the 2013 Annual Social and Economic Supplement to the Current Population Survey—the most currently available data for assessing labor force dynamics across the country in this way.
|Does working from home work? Evidence from a Chinese experiment||Nicholas Bloom, James Liang, John Roberts, Zhichun Jenny Ying||
Does working from home work? Evidence from a Chinese experimentAuthor: Nicholas Bloom, James Liang, John Roberts, Zhichun Jenny Ying
Publisher: Quarterly Journal of Economics
A rising share of employees now regularly engage in working from home (WFH), but there are concerns this can lead to “shirking from home.” We report the results of a WFH experiment at Ctrip, a 16,000-employee, NASDAQ-listed Chinese travel agency. Call center employees who volunteered to WFH were randomly assigned either to work from home or in the office for nine months. Home working led to a 13% performance increase, of which 9% was from working more minutes per shift (fewer breaks and sick days) and 4% from more calls per minute (attributed to a quieter and more convenient working environment). Home workers also reported improved work satisfaction, and their attrition rate halved, but their promotion rate conditional on performance fell. Due to the success of the experiment, Ctrip rolled out the option to WFH to the whole firm and allowed the experimental employees to reselect between the home and office. Interestingly, over half of them switched, which led to the gains from WFH almost doubling to 22%. This highlights the benefits of learning and selection effects when adopting modern management practices like WFH.
Labor Markets - CPI Affiliates
|John Mirowsky||Professor||University of Texas at Austin|
|John Van Reenen||Full Professor of Economics; Director, Center for Economic Performance||London School of Economics|
|Jonas Pontusson||Professor of Polics||Princeton University|
|Julie E. Brines||Associate Professor||University of Washington|
|Kevin Lang||Professor; Research Associate, National Bureau of Economic Research||Boston University|
Labor Markets - Other Research
|Overwork and the Slow Convergence in the Gender Gap in Wages||Youngjoo Cha, Kim A. Weeden||
Overwork and the Slow Convergence in the Gender Gap in WagesAuthor: Youngjoo Cha, Kim A. Weeden
Publisher: American Sociological Review
Despite rapid changes in women’s educational attainment and continuous labor force experience, convergence in the gender gap in wages slowed in the 1990s and stalled in the 2000s. Using CPS data from 1979 to 2009, we show that convergence in the gender gap in hourly pay over these three decades was attenuated by the increasing prevalence of “overwork” (defined as working 50 or more hours per week) and the rising hourly wage returns to overwork. Because a greater proportion of men engage in overwork, these changes raised men’s wages relative to women’s and exacerbated the gender wage gap by an estimated 10 percent of the total wage gap. This overwork effect was sufficiently large to offset the wage-equalizing effects of the narrowing gender gap in educational attainment and other forms of human capital. The overwork effect on trends in the gender gap in wages was most pronounced in professional and managerial occupations, where long work hours are especially common and the norm of overwork is deeply embedded in organizational practices and occupational cultures. These results illustrate how new ways of organizing work can perpetuate old forms of gender inequality.
|The Great Recession and High-Frequency Spanking||Chloe Anderson, Christopher Wimer||
The Great Recession and High-Frequency SpankingAuthor: Chloe Anderson, Christopher Wimer
Publisher: Russell Sage Foundation
In a new paper, the Columbia Population Research Center’s Jeanne Brooks-Gunn, William Schneider, and Jane Waldfogel offer new insight into the connection between economic distress and child well-being. Using data from the Fragile Families and Child Wellbeing Study (FFCWS), the authors investigate whether the Great Recession was associated with increased use of high-frequency maternal spanking, which previous studies have shown elevates the risk of child abuse.
|Multiple Program Participation and the SNAP Program||Robert A. Moffitt||
Multiple Program Participation and the SNAP ProgramAuthor: Robert A. Moffitt
Publisher: Russell Sage Foundation
Receipt of benefits from other traditional transfer programs by Supplemental Nutrition Assistance Program (SNAP) families is common, with 76 percent of those families receiving at least one other major benefit of that type, excluding Medicaid, in 2008. However, over half of these only received one other benefit and only a very small fraction received more than two others. Over the long-term, multiple benefit receipt among SNAP families has been falling, a result of declines in the Temporary Assistance for Needy Families (TANF) caseload offsetting rises in the Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), and Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) caseloads. Finally, this analysis shows that high marginal tax rates generated by multiple program receipt are relevant for only a small portion of the TANF caseload, namely, the portion of the caseload that is nondisabled, nonelderly, and have earnings in the phaseout regions of the programs where marginal tax rates are high. The vast majority of SNAP families are not affected and, indeed, most have sufficiently low earnings that they face negative cumulative marginal tax rates.
|Public Transfers and Material Hardship in the Great Recession||Christopher Wimer||
Public Transfers and Material Hardship in the Great RecessionAuthor: Christopher Wimer
Publisher: Russell Sage Foundation
In a new paper, the Columbia Population Research Center’s Natasha V. Pilkauskas, Janet M. Currie, and Irwin Garfinkel explore the material hardships experienced by disadvantaged families and how well government programs were able to staunch the bleeding. The results indicate that the recession did indeed lead to spikes in material hardships, but that things would have been quite a bit worse if not for the response of the social safety net.
|State Fiscal Policy during the Great Recession||Andrea Louise Campbell, Michael W. Sances||
State Fiscal Policy during the Great RecessionAuthor: Andrea Louise Campbell, Michael W. Sances
Plunging tax revenues and soaring social program demand during the Great Recession created state budget shortfalls of historic magnitude. After reviewing states’ aggregate reaction to the economic downturn, we conduct an original analysis of the recession’s budgetary impact on the states and their policy responses. Economic factors such as falling personal income and home values explain much of the variation in the recession’s impact. State budgeting rules and practices conditioned states’ experiences, but not always as intended: budget gaps were smaller in states with stricter balanced budget requirements, but larger in states with statutory spending limitations. Personal income tax increases were more likely in states with a Democratic legislature or greater public unionization rates, while midyear spending cuts were smaller in states with larger public sector unions. In sum, we find that while states’ objective economic situations determined the bulk of their responses to the Great Recession, political factors determined these responses’ shape and form.
Labor Markets - Multimedia
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