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Open access

Katharine Hall and Dorrit Posel

Abstract

The disruption of family life is one of the important legacies of South Africa’s colonial and apartheid history. Families were undermined by deliberate strategies implemented through the pass laws, forced removals, urban housing policy, and the creation of homelands. Despite the removal of legal restrictions on permanent urban settlement and family co-residence for Africans, patterns of internal and oscillating labor migration have endured, dual or stretched households continue to link urban and rural nodes, children have remained less urbanized than adults, and many grow up without coresident parents. Although children are clearly affected by adult labor migration, they have tended to be ignored in the migration discourse. In this study, we add to the literature by showing how a child lens advances our understanding of the complexities of household arrangements and migration processes for families. In a mixed-methods study, we use nationally representative panel data to describe persistence, and also change, in migration patterns in South Africa when viewed from the perspective of children. We then draw on a detailed case study to explore what factors constrain or permit families to migrate together, or children to join adults at migration destination areas.

Open access

Ekkehardt Ernst, Rossana Merola and Daniel Samaan

Abstract

The current wave of technological change based on advancements in artificial intelligence (AI) has created widespread fear of job loss and further rises in inequality. This paper discusses the rationale for these fears, highlighting the specific nature of AI and comparing previous waves of automation and robotization with the current advancements made possible by a widespread adoption of AI. It argues that large opportunities in terms of increases in productivity can ensue, including for developing countries, given the vastly reduced costs of capital that some applications have demonstrated and the potential for productivity increases, especially among the low skilled. At the same time, risks in the form of further increases in inequality need to be addressed if the benefits from AI-based technological progress are to be broadly shared. For this, skills policies are necessary but not sufficient. In addition, new forms of regulating the digital economy are called for that prevent further rises in market concentration, ensure proper data protection and privacy, and help share the benefits of productivity growth through the combination of profit sharing, (digital) capital taxation, and a reduction in working time. The paper calls for a moderately optimistic outlook on the opportunities and risks from AI, provided that policymakers and social partners take the particular characteristics of these new technologies into account.

Open access

Effrosyni Adamopoulou, Emmanuele Bobbio, Marta De Philippis and Federico Giorgi

Abstract

Aggregate wages display little cyclicality compared to what a standard model would predict. Wage rigidities are an obvious candidate, but the existing literature has emphasized the need to take into account the growing importance of worker composition effects, especially during downturns. This paper seeks to understand the role of firm heterogeneity for aggregate wage dynamics with reference to the Italian case. Using a newly available dataset based on social security records covering the universe of Italian employers between 1990 and 2015, we document that firm composition effects increasingly matter in explaining aggregate wage growth and largely reflect shifts of labor from low-paying to high-paying firms, especially in the most recent years. We find that changes in reallocation of workers across firms accounted for approximately one-fourth of aggregate wage growth during the crisis.

Open access

Xuan Wei, Gülcan Önel, Zhengfei Guan and Fritz Roka

Abstract

The policy debate surrounding the employment of immigrant workers in U.S. agriculture centers around the extent to which immigrant farmworkers adversely affect the economic opportunities of native farmworkers. To help answer this question, we propose a three-layer nested constant elasticity of substitution (CES) framework to investigate the substitutability among heterogeneous farmworker groups based on age, skill, and legal status utilizing National Agricultural Workers Survey (NAWS) data from 1989 through 2012. We use farmwork experience and type of task performed as alternative proxies for skill to disentangle the substitution effect between U.S. citizens, authorized immigrants, and unauthorized immigrant farmworkers. Results show that substitutability between the three legal status groups is small; neither authorized nor unauthorized immigrant farmworkers have a significant impact on the employment of native farmworkers.

Open access

Anja Rossen, Christina Boll and André Wolf

Abstract

This study investigates the incidence of overeducation among graduate workers in 21 European Union countries and its underlying factors based on the European Labor Force Survey 2016. Although controlling for a wide range of covariates, the particular interest lies in the role of fields of study for vertical educational mismatch. The study reveals country differences in the impact of these factors. Compared to Social sciences, male graduates from, for example, Education, Health and welfare, Engineering, and ICT (Information and Communication Technologies) are less and those from Services and Natural sciences are more at risk in a clear majority of countries. These findings are robust against changes of the standard education. Moreover, some fields show gender-specific risks. We suggest that occupational closure, productivity signals and gender stereotypes answer for these cross-field and cross-country differentials. Moreover, country fixed effects point to relevant structural differences between national labor markets and between educational systems.

Open access

Jasmine Boatner

Abstract

Background

Although unemployment rates are at historical lows, there is still a persistent gap between unemployment rates in black and white population. Some have proposed that part of the gap for men can be explained by the higher rate of criminal records in the black population.

Methods

This analysis aims to use negative binomial regressions and the detailed crime data available from the National Longitudinal Survey of Youth 1997 survey to determine if black men with criminal records appear to be the driving force behind the gap.

Results

The author finds that there are significant deviations in labor market outcomes depending on race and ethnicity, even when controlling for a criminal record and premarket skills.

Conclusions

Lowering the disproportionate rate at which black men are incarcerated will not in itself eliminate the unemployment gap between white and black men.

Open access

Duncan McVicar, Andrew Park and Seamus McGuinness

Abstract

This paper examines the impacts of the introduction of the UK National Minimum Wage (NMW) in 1999 and the introduction of the UK National Living Wage (NLW) in 2016 in Northern Ireland (NI) on employment and hours. NI is the only part of the UK with a land border where the NMW and NLW cover those working on one side of the border but not those working on the other side of the border (i.e., Republic of Ireland). This discontinuity in minimum wage coverage enables a research design that estimates the impacts of the NMW and NLW on employment and hours worked using difference-in-differences estimation. We find a small decrease in the employment rate of 22–59/64-year-olds in NI, of up to 2% points, in the year following the introduction of the NMW, but no impact on hours worked. We find no clear evidence that the introduction of the NLW impacted either employment or hours worked in NI.

Open access

Yigit Aydede and Atul Dar

Abstract

A growing wage gap between immigrant and native-born workers is well documented and is a fundamental policy issue in Canada. It is quite possible that wage differences, commonly attributed to the lower quality of foreign credentials or the deficiency in the accreditation of these credentials, merely reflect lower wage offers that immigrant workers receive due to risk aversion among local firms facing an elevated degree of asymmetric information. Using the 2006 and 2011 population censuses, this paper empirically investigates the effects of wage bargaining in labor markets on the wage gap between foreign- and Canadian-educated workers. Our results imply that a significant part of the wage gap between foreign-educated and Canadian-educated immigrant (and native-born) workers is not driven by the employers’ risk aversion but by differences in human capital endowments and occupational matching quality.

Open access

Kathryn Anne Edwards and Jeffrey B. Wenger

Abstract

The risk of labor market, health, and asset-value shocks comprise profound retirement savings challenges for older workers. Parents, however, may experience added risk if their children experience adverse labor market shocks. Prior research has shown that parents support their children financially through an unemployment spell. In this paper, we also provide evidence of financial support from parents and investigate if this financial support is accompanied by adjustments to parental consumption, income, or savings behavior. With longitudinal data on mothers and children from the Panel Study of Income Dynamics, we use within-mother variation in behavior to identify the effect of a child’s labor market shock on parent outcomes. We find evidence of a decline in consumption, an increase in labor supply, and a decrease retirement savings, though the results are heterogenous among mothers. Our results point to aggregate inefficiencies and inequities that may result from family risk sharing.

Open access

Nicholas Wilson

Abstract

Standard labor market models predict that the likelihood of employment increases, hours worked increase, and individuals transition from less-skilled and temporary jobs to more skilled and more stable employment as they age. I examine the association between age and transactional sex work using national household surveys from Zambia, one of the few settings with general population surveys asking women about transactional sex and a relatively high documented prevalence of employment in transactional sex. My results indicate that the likelihood of employment in transactional sex sharply falls with age. Increased employment opportunities outside of transactional sex do not appear to explain the transactional sex employment-age profile and marital status appears to explain only a portion of it. These findings are consistent with the hypothesis that clients prefer younger transactional sex workers and suggest that policymakers implement interventions designed to reduce client demand for younger females.