Labor Markets

  • Michael Hout
  • Gregory Acs
  • David Card
  • Jesse Rothstein

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

Title Author Media
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 Saving

Author: Gopi Shah Goda, Colleen Flaherty Manchester, Aaron Sojourner
Publisher: Journal of Public Economics
Date: 11/2014

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 Work

Author: Shelley J. Correll, Erin L. Kelly, Lindsey Trimble O’Connor, Joan C. Williams
Publisher: Work and Occupations
Date: 02/2014

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 Markets

Author: Michael Hout, Erin Cumberworth
Publisher: Stanford Center on Poverty and Inequality
Date: 01/2014

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 Occupations

Author: M.C. Bradley, Jiffy Lansing, Matthew Stagner
Publisher: Mathematica Policy Research
Date: 01/2013
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.
Housing and the Great Recession Ingrid Gould Ellen, Samuel Dastrup

Housing and the Great Recession

Author: Ingrid Gould Ellen, Samuel Dastrup
Date: 10/2012

The story of the Great Recession cannot be told without addressing housing and, in particular, the dramatic decline in housing prices that began in late 2006. A distinctive feature of the Great Recession is its intimate connection to the housing sector; indeed many would argue that the Great Recession was triggered by the widespread failure of risky mortgage products. Whatever the sources of the Great Recession may have been, the housing sector is still deeply troubled and is a key contributor to our ongoing economic duress. This recession brief lays out the main features of the downturn in the housing sector.

labor markets - CPI Affiliates

Toby L. Parcel's picture Toby L. Parcel Professor of Sociology
North Carolina State University
Vered Kraus's picture Vered Kraus Professor, Department of Sociology and Anthropology
University of Haifa
Adina Sterling Assistant Professor of Organizational Behavior
Stanford University
Arne L. Kalleberg's picture Arne L. Kalleberg Kenan Distinguished Professor of Sociology; Adjunct Professor of Management, Kenan-Flager School of Business; Adjunct Professor of Public Policy and Global Studies, University of North Carolina at Chapel Hill
University of North Carolina
Charles Halaby's picture Charles Halaby Martindale Bascom Professor of Sociology Emeritus, Research Director of General Education Assessment
University of Wisconsin-Madison


Labor Markets - Other Research

Title Author Media
Household Wealth Trends in the United States, 1962-2013: What Happened Over the Great Recession? Edward N. Wolff

Household Wealth Trends in the United States, 1962-2013: What Happened Over the Great Recession?

Author: Edward N. Wolff
Publisher: The National Bureau of Economic Research
Date: 12/2014

Asset prices plunged between 2007 and 2010 but then rebounded from 2010 to 2013. The most telling finding is that median wealth plummeted by 44 percent over years 2007 to 2010, almost double the drop in housing prices. The inequality of net worth, after almost two decades of little movement, was also up sharply. Relative indebtedness expanded, particularly for the middle class, though the proximate causes were declining net worth and income rather than an increase in absolute indebtedness. The sharp fall in median net worth and the rise in overall wealth inequality over these years are traceable primarily to the high leverage of middle class families and the high share of homes in their portfolio. The racial and ethnic disparity in wealth also widened considerably. Households under age 45 saw their relative and absolute wealth declined sharply. Rather remarkably, there was virtually no change in median wealth from 2010 to 2013 despite the rebound in asset prices. The proximate cause was the high dissavings of the middle class, though their debt continued to fall. Wealth inequality and the racial and ethnic wealth gap also remained largely unchanged, though there was some recovery of net worth for young households.

Wealth Levels, Wealth Inequality, and the Great Recession Fabian T. Pfeffer, Sheldon Danziger, Robert F. Schoeni

Wealth Levels, Wealth Inequality, and the Great Recession

Author: Fabian T. Pfeffer, Sheldon Danziger, Robert F. Schoeni
Publisher: Russell Sage Foundation
Date: 05/2014

This research brief assesses two questions about the extent to which the Great Recession altered the level and distribution of wealth through 2013--the most recent year of data available on wealth held by American families. 1. By how much did wealth levels decline during the Great Recession, and by how much did they recover through 2013? 2. Did wealth inequality increase, decrease, or remain steady during the Great Recession?

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 Wages

Author: Youngjoo Cha, Kim A. Weeden
Publisher: American Sociological Review
Date: 04/2014

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 Spanking

Author: Chloe Anderson, Christopher Wimer
Publisher: Russell Sage Foundation
Date: 03/2014

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 Program

Author: Robert A. Moffitt
Publisher: Russell Sage Foundation
Date: 02/2014

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.

Labor Markets - Multimedia

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