The scars of youth: Effects of early‐career unemployment on future unemployment experience

Does early‐career unemployment cause future unemployment? The authors approach this question using German administrative matched employer–employee data that track almost 700,000 individuals over 24 years. Instrumenting early‐career unemployment with firm‐specific labour demand shocks, they find significant and long‐lasting “scarring effects”. In the mean, each additional day of unemployment during the first eight years on the labour market increases unemployment in the following 16 years by half a day. However, quantile regressions show that the scarring effects are much stronger for individuals who already suffer from lengthy and repeated spells of unemployment.     

Can welfare and labour market regimes explain cross‐country differences in the unemployment of young people?

No single institution can reduce (long‐term) youth unemployment. Welfare and labour market institutions function as “bundles”, through multiple inter‐institutional synergies. Based on a focused literature review for theory and on cluster analysis for empirics, the author identifies five such regimes across the EU‐27 and estimates their effects on the youth unemployment ratio and on long‐term youth unemployment. The most helpful institutional arrangement for young people in the labour market would be a combination of strong dual apprenticeship embedded in a corporatist labour market regime with high levels of social security, active labour market policy, and spending on education and childcare.     

Fractured lives: understanding urban youth vulnerability in Perú

ABSTRACT

The paper reports on a mixed methods study that sought to analyse determinants of youth labour market and educational disengagement in Peru. It begins by questioning the widespread focus on NEET – youth not in employment, education or training – as a measure of youth vulnerability in countries with extensive informal labour markets where labour precarity can be as problematic as unemployment for young people’s futures. A broader category of ‘urban vulnerable’ youth, including both NEET and precarious workers, is proposed and used as the basis for analysing the factors that influence young people’s trajectories. Key factors and shocks in youth trajectories are identified through qualitative life histories, and are tested using cross-section and panel survey data. Findings from the study have implications for the analysis of youth labour market vulnerability in the Global South, as well as for the policies that seek to address this problem.     

Inequality of opportunity and (unequal) opportunities in the youth labour market: How is the Arab world different?

The Middle East and North Africa (MENA) labour market is emblematic of widespread youth unemployment and high discouragement rates, experiencing disproportionately high levels of unemployment among educated young people. Using ILO School-to-Work Transition Surveys for Egypt, Jordan and Tunisia, the authors explore whether this is related to inequality of opportunity or to deeper structural characteristics that create a mismatch between skill demand and supply on the labour market. The low availability of high-skilled jobs and the low value placed on skills gained through the system of vocational training are found to have high explanatory power.     

Youth earnings and labour market volatility in Europe

The authors provide new evidence on youth earnings and labour market volatility, including flows into and out of employment, across Europe during the Great Recession. EU‐SILC data for the period 2004–13 reveal large disparities in volatility levels and trends across European countries. As expected, the Great Recession increased youth labour market volatility, offsetting the trends observed over the previous years of economic prosperity. A variance decomposition exercise points to greater exposure to worker turnover in southern Europe. Fixed effects regression on labour market institutions relates higher unemployment benefits and more stringent employment protection legislation to lower earnings and labour market volatility.     

EU Integration & Emigration Consequences: The Case of Lithuania

This paper analyses the causes, consequences, and policy implications of Lithuanian emigration following the country’s European Union (EU) accession in May 2004. After placing Lithuanian emigration in its historical context, the study assesses the recent dynamics, including the driving forces and characteristics of Lithuanian emigration at both the international and domestic level. The study finds that the primary determinants of this movement are both demand‐ and supply‐side factors. On the demand side, the labour shortages, decline in the working age population, and desire for cheaper labour in Western European countries function to attract Lithuanian labour. Concurrently, lower wages, higher unemployment, and the generally less developed economic conditions in Lithuania are encouraging Lithuanians to take advantage of the greater mobility that came with EU accession. The expanding networks linking migrants and potential migrants are facilitating this out‐migration, as well as the social mind‐set by which emigration is a perceived solution to socio‐economic difficulties. This study concludes that the consequences of this new emigration reality are mixed. The free movement of workers has helped to relieve pressure on the domestic labour market, drive down unemployment, place upward pressure on wages, and increase the remittances rate to Lithuania. However, concern is not ill‐founded; recent emigration has introduced labour market shortages, placed greater demographic pressure on the country, and increased the likelihood of brain drain. This study argues, therefore, that while Lithuanian emigration cannot and should not be stopped, Lithuania does have policy alternatives as a sending‐country that will help to mitigate the costs of emigration and maximize the benefits for the country’s long‐term development.     

Ethnic Enclaves,Networks and Self‐Employment among Middle Eastern Immigrants in Sweden

The proportion of immigrants from countries in the Middle East living in Sweden has increased since the 1970s, and it is a well‐known fact that immigrants from the Middle East suffer from low earnings and high rates of unemployment on the Swedish labour market. There are often great hopes that self‐employment will enable immigrants to improve their labour market situation. Further, in Sweden as in many other countries, the question of whether the existence of ethnic enclaves are good or bad for immigrants’ earnings and employment opportunities has also been widely debated. This paper presents a study of the extent to which Middle Eastern ethnic enclaves and networks in Sweden enhance or hinder immigrants’ self‐employment. The results show that the presence of ethnic enclaves increases the propensity for self‐employment. Thus, immigrants in ethnic enclaves provide their co‐ethnics with goods and services that Swedish natives are not able to provide. The results also show that ethnic networks seem to be an obstacle to immigrant self‐employment. One explanation is that an increase in network size implies increased competition for customers among self‐employed immigrants. The question of whether ethnic enclaves are good or bad for the integration of immigrants into the labour market has been widely debated. The results of this paper provide us with information about the integration puzzle. Ethnic enclaves seem to enhance self‐employment propensities among Middle Eastern immigrants in Sweden.     

Immigrant Populations and the Labour Market in Greece at the Beginning of the Twenty‐First Century

Our purpose in undertaking this research is to methodically map the labour market circumstances of the main immigrant groups in Greece. We classify all of the Districts of Greece into three categories (Diverse, Mixed and Unmixed) according to the ethnic composition of each District. We measure how the employment status of the immigrants varies (1) according to the ethnic group and sex of the immigrant, and (2) according to the ethnic composition and economic structure of a District. In general, the majority of immigrants exhibit lower unemployment and higher economic activity rates than the indigenous Greeks. Three immigrant groups (Albanians, Bulgarians and “Other”), which make up two‐thirds of the foreign‐born population of Greece, have lower unemployment rates than the national average, and lower rates than Greeks as well. The poorest labour market outcomes are observed in Unmixed and Mixed Districts, whereas Diverse Districts are better off. At the regional level, the most disadvantaged Geographical Department is the Ionian Islands, since it presents the highest unemployment rates for the general population for both sexes. With regard to sex‐differential unemployment across immigrant groups, we found that women exhibit higher unemployment than men in almost every ethnic group.     

Correlates of Voluntary vs. Involuntary Part‐time Employment among US Women

This article presents a study of the extent to which type and duration of labour force attachment add to the explanatory power of psychological, demographic, and family household characteristics to predict voluntary (n=166) vs. involuntary part‐time (n=160) employment of women in the United States. We use the terms ‘voluntary’ and ‘involuntary’ to reflect the woman's choice in accepting to work in paid part‐time employment. In this context, voluntary part‐time work is not meant to be construed as charitable, non‐paid activities, but rather is construed as individuals who are working part‐time but who would prefer to be working full‐time, if a suitable job were available. Using data from the National Longitudinal Survey of Labor Market Experience (NLSLME), we found that labour market attachment characteristics added little to predict part‐time employment status (involuntary vs. voluntary) and had virtually no effect on the odds of any other correlates on employment status. The major exception was number of years of unemployment. The longer working women were previously unemployed, the greater the likelihood they were involuntarily employed in part‐time jobs. In addition, we found that marriage and private sector employment decreased the likelihood of involuntary part‐time employment. Findings suggest that involuntarily part‐time employed women appear to be ‘settling’ for what they can get, namely, part‐time rather than full‐time jobs and that unmarried part‐timers may be viewed as a stigmatized or marginal group more likely to be employed in the public rather than private sector. Policy implications and future research are discussed.     

The economy of smiles: affect,labour and the contemporary deserving poor

This paper examines the affective dimensions of new forms of informal entrepreneurial work carried out in spaces of unemployment. Situating the analysis within contemporary scholarship on deservingness and on affect and labour, I shed light on the forms of entrepreneurial labour that rely upon affect‐driven economies of exchange underpinned by moral judgements of deservingness, value and worth. In particular, this paper draws on a multi‐city (Melbourne, London, San Francisco) study of homeless street press sellers (The Big Issue and Street Sheet) to explore the ways in which contemporary practices of charity and care are carried out through individualized market‐place exchanges. Sellers’ accounts of their work reveal how smiling and being (or looking) happy is a performative expectation that must be managed in the face of poverty and precarity.     

A multidimensional employment quality index for Brazil, 2002–11

In countries where informal, insecure jobs are widespread, traditional labour market indicators – such as the unemployment rate, labour force participation rate and wages – are not necessarily the most meaningful. The authors use a multidimensional employment quality index to analyse the Brazilian labour market over the period 2002–11, across three dimensions: earnings, formality (measured by the existence of an employment contract and social security contributions) and job tenure. The results show a significant increase in employment quality overall, especially in the years 2009–11, but with considerable differences between wage employees and self‐employed workers, and between industries.     

United by Gender or Divided by Class? Women's Work Orientations and Labour Market Behaviour

Recent debates on the relationship between women's work orientations and their labour market behaviour have been marked by a polarization between those who emphasize personal choice and those who argue that constraint is equally, if not more, important. However, in both approaches ‘orientation’ is understood primarily as a choice between prioritizing paid work or family (understood almost exclusively in terms of childcare responsibilities) for all women regardless of socioeconomic class. Drawing on in‐depth qualitative interview data, this article outlines some of the similarities and differences in the work orientations of women in professional/managerial, intermediate and routine/manual socioeconomic classes in Oxford. It develops the concept of ‘work orientation’ to include the meaning of paid work as well as labour market behaviour for women with and without children. The data presented here suggest that there are important class‐based differences in women's attitudes and that apparently similar work orientations may have very different causes and labour market consequences.     

Hat sich das duale System in den neuen Ländern erfolgreich etabliert?

In this paper, the transition from firm-based vocational training into the labor market is compared for East and West Germany in the first half of the 1990s. Special attention is given to the extent of unemployment after finishing training and its impact on the following entry into the first job. The paper aims at answering the following questions: How big are East-West-differences at the entry to the labour market? Did these differences decrease towards the middle of the 1990s? Are discrepancies between East and West related to diverging structural labour market conditions and individual differences of the leavers of the training system? By comparing the patterns of entering the labour market in both parts of the country, the paper aims at answering the question whether the dual system of vocational training has been established successfully in East Germany during the first half of the 1990s or whether an ongoing disorder at the ‘second threshold’ points towards a (temporary) failure of the ‘transition regime’ to the labour market. The empirical analyses are based on data from the ‘IAB-Beschäftigtenstichprobe 1975–1995’.     

Labour Market Disadvantages of Second‐Generation Turks and Moroccans in the Netherlands: Before and during the Great Recession

This study uses two waves of panel data to examine the labour market integration of children of Moroccan and Turkish immigrants in the Netherlands. The data show a persisting educational attainment gap in terms of high school completion and post‐secondary attendance. The analyses of prime working‐age respondents indicate substantial ethnic penalties that accrue from the hiring process: controlling for educational background and demographics, the youngest cohort of the second generation is less likely to have employment than the native Dutch. We improve on earlier research on ethnic penalties in the Dutch labour market by including measures of precarious work – the chance of avoiding of non‐contracted work – and by comparing minorities’ standing in a pre‐recession (2009) and a peak‐recession (2013) labour market. The results indicate increasing employment disadvantages for both second‐generation groups at a time of labour surplus.     

Career Compromise Types Among University Graduates During the School‐to‐Work Transition

Because of high youth unemployment caused by structural conditions, South Korean university graduates must compromise their employment preferences and instead accept whatever work is available. In this study, we classified the types of compromises using latent profile analysis to examine various factors involved in the career compromise of 472 recent university graduates during their school‐to‐work transition. We identified four types of compromise patterns with distinct characteristics and discovered that the university graduates who did not compromise their interest and aptitude in their job selection showed a higher level of commitment to their career compared with those who compromised. Results suggest that individuals who do not compromise their interests and aptitudes are more likely to have successful and fulfilling long‐term careers.     

Kann der regionale Kontext zur „Arbeitslosenfalle“ werden?

The focus of this paper is on mobility between local labour markets. Using multilevel data, the effect of local unemployment on mobility between local labour markets is investigated. A distinction is made between several dimensions of unemployment: (1) unemployment as a status in the life course at the individual level, (2) unemployment duration, (3) the unemployment rate at the regional level. One of the main results contradicts neoclassical economics: the rate of mobility between local labour markets decreases with increasing local unemployment. In a sense, persons become “trapped” in the local context because under bad labour market conditions unemployed persons, too, tend to immobility. As a result, a devaluation of human capital might be possible.     

Why do immigrants have longer periods of unemployment? Swiss evidence

Immigrant groups, especially those originating from non‐European countries, tend to experience disadvantages in the labour market and to be overrepresented among the recipients of welfare benefits in many European countries. In the public debate, this outcome is sometimes explained with reference to migration‐related factors such as weaker work values than natives (i.e., acceptability of remaining on benefits), smaller and lower quality of informal networks and lower levels of psychological well‐being. Indeed, we find that these factors significantly influence unemployment duration in the expected direction. However, they explain only a small share of the overall disadvantage that some immigrant groups experience. We conclude that at least some of the large differences we observed in unemployment durations are likely to be due to other factors including discrimination by employers.     

From wage rigidity to labour market institution rigidity: A turning-point in explaining unemployment?

In this paper we offer a critical discussion about the concept of labour market rigidity in the light of recent theoretical approaches that have aimed to provide sound micro-foundations to the presence of unemployment in market economies. We point out that the concept of labour market rigidity usually referred to in such theories has changed over time, involving in succession the rigidity of wages, contracts and labour market institutions. We also appraise the factors that lead labour market institutions rigidity, stressed by the search literature, to challenge the more widespread explanation of unemployment grounded on wage rigidity. Moreover, we analyse some theoretical and empirical issues that cast doubt on the ability to deal with unemployment, disentangling the role of institutional rigidities from that of wage stickiness.     

“Picking Winners”: The Recent Transformation of Australia's Skilled Migration Policy

From 1980 to 1996, Australian researchers identified consistently inferior labor market outcomes for professionals from non‐English‐speaking background source countries. In 1997, the incominy conservative government initiated a major review of Australia's skilled migration program, based on a determination to ‘select for success’among applicants. Subsequent initiatives included mandatory English language testing, rigorous qualifications screening, incentives for international students to migrate, and abolition of income support in the first two years postarrival. This article provides a detailed analysis of factors leading to this policy transformation. Labor market outcomes for 2001 are defined, including a halving of unemployment among recently arrived migrants.