Papers Containing Keywords(s): 'labor'
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Viewing papers 61 through 70 of 250
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Working PaperDo Short-Term Incentives Affect Long-Term Productivity?
March 2020
Working Paper Number:
CES-20-10
Previous research shows that stock repurchases that are caused by earnings management lead to reductions in firm-level investment and employment. It is natural to expect firms to cut less productive investment and employment first, which could lead to a positive effect on firm-level productivity. However, using Census data, we find that firms make cuts across the board irrespective of plant productivity. This pattern seems to be associated with frictions in the labor market. Specifically, we find evidence that unionization of the labor force may prevent firms from doing efficient downsizing, forcing them to engage in easy or expedient downsizing instead. As a result of this inefficient downsizing, EPS-driven repurchases lead to a reduction in long-term productivity.View Full Paper PDF
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Working PaperBetween Firm Changes in Earnings Inequality: The Dominant Role of Industry Effects
February 2020
Working Paper Number:
CES-20-08
We find that most of the rising between firm earnings inequality that dominates the overall increase in inequality in the U.S. is accounted for by industry effects. These industry effects stem from rising inter-industry earnings differentials and not from changing distribution of employment across industries. We also find the rising inter-industry earnings differentials are almost completely accounted for by occupation effects. These results link together the key findings from separate components of the recent literature: one focuses on firm effects and the other on occupation effects. The link via industry effects challenges conventional wisdom.View Full Paper PDF
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Working PaperMaternal Labor Dynamics: Participation, Earnings, and Employer Changes
December 2019
Working Paper Number:
CES-19-33
This paper describes the labor dynamics of U.S. women after they have had their first and subsequent children. We build on the child penalty literature by showing the heterogeneity of the size and pattern of labor force participation and earnings losses by demographic characteristics of mothers and the characteristics of their employers. The analysis uses longitudinal administrative earnings data from the Longitudinal Employer-Household Dynamics database combined with the Survey of Income and Program Participation survey data to identify women, their fertility timing, and employment. We find that women experience a large and persistent decrease in earnings and labor force participation after having their first child. The penalty grows over time, driven by the birth of subsequent children. Non-white mothers, unmarried mothers, and mothers with more education are more likely to return to work following the birth of their first child. Conditional on returning to the labor force, women who change employers earn more after the birth of their first child than women who return to their pre-birth employers. The probability of returning to the pre-birth employer and industry is heterogeneous over both the demographics of mothers and the characteristics of their employers.View Full Paper PDF
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Working PaperWhat Do Establishments Do When Wages Increase? Evidence from Minimum Wages in the United States
November 2019
Working Paper Number:
CES-19-31
I investigate how establishments adjust their production plans on various margins when wage rates increase. Exploiting state-by-year variation in minimum wage, I analyze U.S. manufacturing plants' responses over a 23-year period. Using instrumental variable method and Census Microdata, I find that when the hourly wage of production workers increases by one percent, manufacturing plants reduce the total hours worked by production workers by 0.7 percent and increase capital expenditures on machinery and equipment by 2.7 percent. The reduction in total hours worked by production workers is driven by intensive-margin changes. The estimated elasticity of substitution between capital and labor is 0.85. Following the wage increases, no statistically significant changes emerge in revenue, materials or total factor productivity. Additionally, I nd that when wage rates increase, establishments are more likely to exit the market. Finally, I provide evidence that when the minimum wage increases the wages of some of the establishments in a firm, the firm also increases the wages for its other establishments.View Full Paper PDF
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Working PaperA Task-based Approach to Constructing Occupational Categories with Implications for Empirical Research in Labor Economics
September 2019
Working Paper Number:
CES-19-27
Most applied research in labor economics that examines returns to worker skills or differences in earnings across subgroups of workers typically accounts for the role of occupations by controlling for occupational categories. Researchers often aggregate detailed occupations into categories based on the Standard Occupation Classification (SOC) coding scheme, which is based largely on narratives or qualitative measures of workers' tasks. Alternatively, we propose two quantitative task-based approaches to constructing occupational categories by using factor analysis with O*NET job descriptors that provide a rich set of continuous measures of job tasks across all occupations. We find that our task-based approach outperforms the SOC-based approach in terms of lower occupation distance measures. We show that our task-based approach provides an intuitive, nuanced interpretation for grouping occupations and permits quantitative assessments of similarities in task compositions across occupations. We also replicate a recent analysis and find that our task-based occupational categories explain more of the gender wage gap than the SOC-based approaches explain. Our study enhances the Federal Statistical System's understanding of the SOC codes, investigates ways to use third-party data to construct useful research variables that can potentially be added to Census Bureau data products to improve their quality and versatility, and sheds light on how the use of alternative occupational categories in economics research may lead to different empirical results and deeper understanding in the analysis of labor market outcomes.View Full Paper PDF
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Working PaperHigh Labor Force Attachment, but Few Social Ties? Life-Course Predictors of Women's Receipt of Childcare Subsidies
September 2019
Working Paper Number:
CES-19-26
The U.S. federal Child Care and Development Fund (CCDF) childcare subsidy represents the largest source of means-tested assistance for U.S. families with low incomes. The CCDF subsidy aims to help mothers with low incomes gain employment and education, with implications for women's labor force participation, and the wellbeing of their children. Because recipients of the CCDF subsidy are either already employed, or seek the subsidy with the goal of gaining employment or schooling, this group may represent the public assistance recipients who are best able to succeed in the low-wage labor market. However, existing research on the CCDF observes recipients only after they begin receiving the subsidy, thus giving an incomplete picture of whether recipients may select into subsidy receipt, and how subsidy recipiency is situated in women's broader work and family trajectories. My study links administrative records from the CCDF to the American Community Survey (ACS) to construct a longitudinal data set from 38 states that observes CCDF recipients in the 1-2 years before they first received the subsidy. I compare women who subsequently received the CCDF subsidy to other women with low incomes in the ACS who did not go on to receive the subsidy, with a total of roughly 641,000 individuals. I find that CCDF recipients are generally positively-selected on employment history and educational attainment, but appear to have lower levels of social support than non-recipients.View Full Paper PDF
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Working PaperDid Timing Matter? Life Cycle Differences in Effects of Exposure to the Great Recession
September 2019
Working Paper Number:
CES-19-25
Exposure to a recession can have persistent, negative consequences, but does the severity of those consequences depend on when in the life cycle a person is exposed? I estimate the effects of exposure to the Great Recession on employment and earnings outcomes for groups defined by year of birth over the ten years following the beginning of the recession. With the exception of the oldest workers, all groups experience reductions in earnings and employment due to local unemployment rate shocks during the recession. Younger workers experience the largest earnings losses in percent terms (up to 13 percent), in part because recession exposure makes them persistently less likely to work for high-paying employers even as their overall employment recovers more quickly than older workers'. Younger workers also experience reductions in earnings and employment due to changes in local labor market structure associated with the recession. These effects are substantially smaller in magnitude but more persistent than the effects of unemployment rate increases.View Full Paper PDF
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Working PaperGender Differences in Self-employment Duration: the Case of Opportunity and Necessity Entrepreneurs
September 2019
Working Paper Number:
CES-19-24
A strand of the self-employment literature suggests that those 'pushed' into self-employment out of necessity may perform differently from those 'pulled' into self-employment to pursue a business opportunity. While findings on self-employment outcomes by self-employed type are not unanimous, there is mounting evidence that performance outcomes differ between these two self-employed types. Another strand of the literature has found important gender differences in self-employment entry rates, motivations for entry, and outcomes. Using a unique set of data that links the American Community Survey to administrative data from Form 1040 and W-2 records, we bring together these two strands of the literature. We explore whether there are gender differences in self-employment duration of self-employed types. In particular, we examine the likelihood of self-employment exit towards unemployment versus the wage sector for five consecutive entry cohorts, including two cohorts who entered self-employment during the Great Recession. Severely limited labor-market opportunities may have driven many in the recession cohorts to enter self-employment, while those entering self-employment during the boom may have been pursuing opportunities under favorable market conditions. To more explicitly test the concept of 'necessity' versus 'opportunity' self-employment, we also examine the wage labor attachment (or weeks worked in the wage sector) in the year prior to becoming self-employed. We find that, within the cohorts we examine, there are gender differences in the rate at which men and women depart self-employment for either wage work or non-participation, but that the patterns are dependent on pre self-employment wage-sector attachment and cohort effects.View Full Paper PDF
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Working PaperDemographic Origins of the Startup Deficit
July 2019
Working Paper Number:
CES-19-21
We propose a simple explanation for the long-run decline in the startup rate. It was caused by a slowdown in labor supply growth since the late 1970s, largely pre-determined by demographics. This channel explains roughly two-thirds of the decline and why incumbent firm survival and average growth over the lifecycle have been little changed. We show these results in a standard model of firm dynamics and test the mechanism using shocks to labor supply growth across states. Finally, we show that a longer startup rate series imputed using historical establishment tabulations rises over the 1960-70s period of accelerating labor force growth.View Full Paper PDF
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Working PaperFraudulent Financial Reporting and the Consequences for Employees
March 2019
Working Paper Number:
CES-19-12
We examine employment effects, such as wages and employee turnover, before, during, and after periods of fraudulent financial reporting. To analyze these effects, we combine U.S. Census data with SEC enforcement actions against firms with serious misreporting ('fraud'). We find compared to a matched sample that fraud firms' employee wages decline by 9% and the separation rate is higher by 12% during and after fraud periods while employment growth at fraud firms is positive during fraud periods and negative afterward. We discuss several reasons that plausibly drive these findings. (i) Frauds cause informational opacity, misleading employees to still join or continue to work at the firm. (ii) During fraud, managers overinvest in labor changing employee mix, and after fraud the overemployment is unwound causing effects from displacement. (iii) Fraud is misconduct; association with misconduct can affect workers in the labor market. We explore the heterogeneous effects of fraudulent financial reporting, including thin and thick labor markets, bankruptcy and non-bankruptcy firms, worker movements, pre-fraud wage levels, and period of hire. Negative wage effects are prevalent across these sample cuts, indicating that fraudulent financial reporting appears to create meaningful and negative consequences for employees possibly through channels such as labor market disruptions, punishment, and stigma.View Full Paper PDF
