Job Opportunities
Explaining the Labor Share: Automation Vs Labor Market Institutions
Luís Guimarães & Pedro Mazeda Gil
Labour Economics, April 2022
Abstract:
We propose a simple model to assess the evolution of the US labor share and how automation affects employment. In our model, heterogeneous firms may choose a manual technology and hire a worker subject to matching frictions. Alternatively, they may choose an automated technology and produce using only machines (robots). Our model suggests that automation reduces the labor share but increases employment and wages. Furthermore, our model suggests that labor market institutions are unlikely to have played a major role in the fall of the US labor share after 1987. Instead, technological factors are a more promising candidate.
The Minimum Wage, Self-Employment, and the Online Gig Economy
Benjamin Glasner
Journal of Labor Economics, forthcoming
Abstract:
This paper estimates the effect of minimum wage increases on work that is not covered by minimum wage laws. I find minimum wage increases in the early 2000s resulted in small reductions in engagement in traditional self-employment. Following the development of the online gig economy in the 2010s, a 10% increase in the minimum wage increased the number of nonemployer establishments classified as transportation and warehousing services by approximately 2.7%. The counties most likely to exhibit a positive relationship between the minimum wage and participation in uncovered work are those with low labor market concentration and active Uber marketplaces.
LinkedIn(to) Job Opportunities: Experimental Evidence from Job Readiness Training
Laurel Wheeler et al.
American Economic Journal: Applied Economics, April 2022, Pages 101-125
Abstract:
Online professional networking platforms are widely used and may help workers to search for and obtain jobs. We run the first randomized evaluation of training work seekers to join and use one of the largest platforms, LinkedIn. Training increases the end-of-program employment rate by 10 percent (7 percentage points), and this effect persists for at least 12 months. The available employment, platform use, and job search data suggest that employment effects are explained by work seekers using the platform to acquire information about prospective employers and perhaps by work seekers accessing referrals and conveying information to prospective employers on the platform.
Substance Abuse during the Pandemic: Implications for Labor-Force Participation
Jeremy Greenwood, Nezih Guner & Karen Kopecky
NBER Working Paper, April 2022
Abstract:
The labor-force participation rates of prime-age U.S. workers dropped in March 2020 — the start of the COVID-19 pandemic — and have still not fully recovered. At the same time, substance-abuse deaths were elevated during the pandemic relative to trend indicating an increase in the number of substance abusers, and abusers of opioids and crystal methamphetamine have lower labor-force participation rates than non-abusers. Could increased substance abuse during the pandemic be a factor contributing to the fall in labor-force participation? Estimates of the number of additional substance abusers during the pandemic presented here suggest that increased substance abuse accounts for between 9 and 26 percent of the decline in prime-age labor-force participation between February 2020 and June 2021.
Would Broadening the UI Tax Base Help Low-Income Workers?
Mark Duggan, Audrey Guo & Andrew Johnston
Stanford Working Paper, January 2022
Abstract:
The tax base for state unemployment insurance (UI) programs varies significantly in the U.S., from a low of $7,000 annually in California to a high of $52,700 in Washington. Previous research has provided surprisingly little guidance to policy makers regarding the tradeoffs associated with this variation. In this paper, we use 37 years of data for all 50 states and Washington, D.C. to estimate the impact of the UI tax base on labor-market outcomes. We find that the low tax base that exists in California and many other states (and the necessarily higher tax rates that accompany these) negatively affects labor market outcomes for part-time and other low-earning workers.
Unemployment insurance programs and the choice to leave the labor force
Patrick Conway
Southern Economic Journal, April 2022, Pages 1373-1400
Abstract:
I extend a labor-market search and matching model of equilibrium with unemployment insurance (UI) program to incorporate the choice to participate in the labor market. UI reform that lowers the UI payment increases search intensity but discourages labor-market participation. Reducing UI payments has the moral-hazard effects derived in the literature but also a non-participation effect. UI reform in North Carolina in mid-2013 provides an empirical test of the model using data from the Current Population Survey. The reduction in size and duration of UI payments led to no significant increase in employment but a significant increase in those exiting the labor force.
Computerization of White Collar Jobs
Marcus Dillender & Eliza Forsythe
NBER Working Paper, March 2022
Abstract:
We investigate the impact of computerization of white-collar jobs on wages and employment. Using online job postings from 2007 and 2010--2016 for office and administrative support (OAS) jobs, we show that when firms adopt new software at the job-title level they increase the skills required of job applicants. Furthermore, firms change the task content of such jobs, broadening them to include tasks associated with higher-skill office functions. We aggregate these patterns to the local labor-market level, instrumenting for local technology adoption with national measures. We find that a 1 standard deviation increase in OAS technology usage reduces employment in OAS occupations by about 1 percentage point and increases wages for college graduates in OAS jobs by over 3 percent. We find negative wage spillovers, with wages falling for both workers with and without a college degree. These results are consistent with technological adoption inducing a realignment in task assignment across occupations, leading office support occupations to become higher skill. We argue relative wage gains for OAS workers indicates that factor-augmenting features of OAS technological change dominate task-substituting features. In addition, while we find that total employment increases, these gains primarily accrue to college-educated women.
Bus ridership and the minimum wage: Evidence from bus stops near fast-food restaurants
Tyler Schipper & Anthony Vecchia
Applied Economics Letters, forthcoming
Abstract:
This paper examines the impact of Minneapolis’ local minimum wage ordinance on bus ridership. We use a difference-in-differences (DD) strategy to compare changes in ridership at bus stops in Minneapolis near fast-food restaurants to similarly situated stops around the metro area where the minimum wage was unchanged. We find that the minimum wage increase caused bus ridership to increase by 1,828 rides per day or 3.5% of post-treatment daily boardings in Minneapolis. We show that the treatment effect is highly concentrated at bus stops near fast-food restaurants. An increase in the intensive margin of labour, or weekly hours, is consistent with our results and available labour market indicators.