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
|What Will My Account Really Be Worth? An Experiment on Exponential Growth Bias and Retirement Saving||Gopi Shah Goda, Colleen Flaherty Manchester, Aaron Sojourner||
What Will My Account Really Be Worth? An Experiment on Exponential Growth Bias and Retirement SavingAuthor: Gopi Shah Goda, Colleen Flaherty Manchester, Aaron Sojourner
Publisher: Journal of Public Economics
Recent findings on limited financial literacy and exponential growth bias suggest saving decisions may not be optimal because such decisions require an accurate understanding of how current contributions can translate into income in retirement. This study uses a large-scale field experiment to measure how a low-cost, direct-mail intervention designed to inform subjects about this relationship affects their saving behavior. Using administrative data prior to and following the intervention, we measure its effect on participation and the level of contributions in retirement saving accounts. Those sent income projections along with enrollment information were more likely to change contribution levels and increase annual contributions relative to the control group. Among those who made a change in contribution, the increase in annual contributions was approximately $1,150. Results from a follow-up survey corroborate these findings and show heterogeneous effects of the intervention by rational and behavioral factors known to affect saving. Finally, we find evidence of behavioral influences on decision-making in that the assumptions used to generate the projections influence the saving response.
|Redesigning, Redefining Work||Shelley J. Correll, Erin L. Kelly, Lindsey Trimble O’Connor, Joan C. Williams||
Redesigning, Redefining WorkAuthor: Shelley J. Correll, Erin L. Kelly, Lindsey Trimble O’Connor, Joan C. Williams
Publisher: Work and Occupations
The demands of today’s workplace—long hours, constant availability, self-sacrificial dedication—do not match the needs of today’s workforce, where workers struggle to reconcile competing caregiving and workplace demands. This mismatch has negative consequences for gender equality and workers’ health. Here, the authors put forth a call to action: to redesign work to better meet the needs of today’s workforce and to redefine successful work. The authors propose two avenues for future research to achieve these goals: research that (a) builds a more rigorous business case for work redesign/redefinition and (b) exposes the underlying gender and class dynamics of current work arrangements.
|State of the Union: Labor Markets||Michael Hout, Erin Cumberworth||
State of the Union: Labor MarketsAuthor: Michael Hout, Erin Cumberworth
Publisher: Stanford Center on Poverty and Inequality
During the Great Recession of 2007 to 2009, the "housing bubble" burst, the financial sector tumbled, banks stopped lending, construction workers lost their jobs, sales of building materials and appliances plummeted, tax revenues fell, and the downward spiral threatened to spin ever lower. But since the recovery began in the summer of 2009, employment has barely kept pace with population growth. The U.S. economy enters 2014 with 7 percent of the labor force unemployed and millions more out of the labor force.
|Connecting At-Risk Youth to Promising Occupations||M.C. Bradley, Jiffy Lansing, Matthew Stagner||
Connecting At-Risk Youth to Promising OccupationsAuthor: M.C. Bradley, Jiffy Lansing, Matthew Stagner
Publisher: Mathematica Policy Research
This brief provides information for programs and organizations that serve at-risk youth transitioning to adulthood. Part of the Administration for Children and Families’ Youth Demonstration Development issue brief series, it explores occupations in health care and construction that hold promise for a quick path to employment without extensive up-front education or training.
|Charitable Giving and the Great Recession||Rob Reich, Christopher Wimer||
Charitable Giving and the Great RecessionAuthor: Rob Reich, Christopher Wimer
Americans have long been, and continue to be, a famously charitable people. Whereas Europeans have well-developed and comprehensive welfare states, the United States has always relied more on private charity to support a multitude of causes, including aid and assistance to the poor.
Labor Markets - CPI Affiliates
|Kevin T. Leicht||Professor of Sociology||The University of Iowa|
|Markus Gangl||Professor for Methods of Empirical Social Research||University of Mannheim|
|Marlis Buchmann||Professor||University of Zurich|
|Marta Tienda||Professor; Maurice P. During '22 Professor in Demographic Studies||Princeton University|
|Martina Morris||Professor of Sociology and Statistics||University of Washington - Seattle|
Labor Markets - Other Research
|Lost Generations? Wealth Among Young Americans||Eugene Steuerle, Signe-Mary McKernan, Caroline Ratcliffe, Sisi Zhang||
Lost Generations? Wealth Among Young AmericansAuthor: Eugene Steuerle, Signe-Mary McKernan, Caroline Ratcliffe, Sisi Zhang
Publisher: Urban Institute
Despite the Great Recession and the fragile economic recovery, the wealth of Americans has grown significantly when a longer-term view is considered. Average household wealth approximately doubled from 1983 to 2010, and average incomes rose similarly. For many, the American dream of working hard, saving more, and becoming wealthier than one's parents holds true.
|Consumption and Income Poverty over the Business Cycle||Bruce D. Meyer, James X. Sullivan||
Consumption and Income Poverty over the Business CycleAuthor: Bruce D. Meyer, James X. Sullivan
Publisher: Research in Labor Economics
We examine the relationship between the business cycle and poverty for the period from 1960 to 2008 using income data from the Current Population Survey and consumption data from the Consumer Expenditure Survey. This new evidence on the relationship between macroeconomic conditions and poverty is of particular interest given recent changes in anti-poverty policies that have placed greater emphasis on participation in the labor market and in-kind transfers. We look beyond official poverty, examining alternative income poverty and consumption poverty, which have conceptual and empirical advantages as measures of the well-being of the poor. We find that both income and consumption poverty are sensitive to macroeconomic conditions. A one percentage point increase in unemployment is associated with an increase in the after-tax income poverty rate of 0.9 to 1.1 percentage points in the long-run, and an increase in the consumption poverty rate of 0.3 to 1.2 percentage points in the long-run. The evidence on whether income is more responsive to the business cycle than consumption is mixed. Income poverty does appear to be more responsive using national level variation, but consumption poverty is often more responsive to unemployment when using regional variation. Low percentiles of both income and consumption are sensitive to macroeconomic conditions, and in most cases low percentiles of income appear to be more responsive than low percentiles of consumption.
|The Return of Depression Economics and the Crisis of 2008||Paul Krugman||
The Return of Depression Economics and the Crisis of 2008Author: Paul Krugman
Publisher: W. W. Norton & Company
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