INTEGRATING ECONOMIC DUALISM AND LABOR MARKET SEGMENTATION:

Although the U.S. economy of the early twenty-first century is vastly different from the U.S. economy prior to the 1970s, the nature of these economic changes and their impact on U.S. workers is unclear. This article claims that despite contemporary economic shifts, differential labor and employer power continues to segment the economy, and workers' position in the labor market continues to predict their rewards, beyond the effects of gender, race, and human capital. Drawing on segmented labor market and dual economy research, we propose a four-category model of the structural factors that influence variance in work-related rewards. We examine the distribution of jobs in each of four categories between 1974 and 2000 and observe that losses and gains across categories are unevenly distributed by race and gender. While white men have experienced the greatest declines in employment and earnings, they have maintained their absolute advantage over women and nonwhites. In multivariate analyses, we find that the structural position of employment continues to be a significant determinant of wages. Although women and racial minorities have experienced sizable increases in employment in primary labor market jobs in the core of the economy, both groups remain overrepresented in low-paying jobs. Moreover women, but not nonwhite men, consistently receive significantly fewer rewards for their labor in both low-paying and high-paying jobs. Our findings suggest that structural factors continue to influence earnings inequality, especially across race and gender lines.     

Union organizing expenditures: Determinants and their implications for union growth

This paper explores some implications of the economics of union organizing. Following the literature, it is argued that the economic costs and benefits of organizing are systematically related to the proportion of the union’s jurisdiction already organized. Evidence is presented that unions do allocate a smaller proportion of their budgets to organizing when a greater proportion of their jurisdiction is already organized. Total union organizing expenditures, however, are found to increase over a broad range as the percentage organized increases. The supply of union-organizing services to unorganized workers apparently only declines at relatively high levels of union penetration. These critical levels of unionization have been attained only by a few U.S. labor organizations.     

Union wages, rents, and skills in health care labor markets

We examine the effect of unions on the earnings of health care workers, with emphasis on the measurement and sources of union wage premiums. Using data constructed from the 1973 though 1994 Current Population Surveys, standard union premium estimates are found to be substantially lower among workers in health care than in other sectors of the economy, and to be smaller among higher skill than among lower skill occupational groups. Longitudinal analysis of workers switching union status, which controls for worker-specific skills, indicates a small impact of unions on earnings within both high and low skilled health care occupations. Evidence is found for small, but significant, union threat effects in health care labor markets. It has been argued that recent legal changes in bargaining unit determination should enhance union organizing and bargaining power. Although we cannot rule this out, such effects are not readily apparent in our data. The authors appreciate the assistance of David Macpherson, who helped develop the CPS data files used in the paper.     

The use and abuse of female domestic workers from Sri Lanka in Lebanon

Women who migrate from Sri Lanka to become domestic workers in Lebanon face gender, class, and race discrimination that often results in abuse, yet the predicament of these women is largely ignored by local and international humanitarian and human rights agencies. Public consciousness about the plight of Asian domestic workers in the Persian Gulf region was raised in 1990 when domestic workers were repatriated in the wake of the Gulf War. In Lebanon, nearly half of the work permits granted to foreigners in 1997 were to women from Sri Lanka. This migration began in the 1970s and is sanctioned by the Sri Lanka government because of the economic benefits accruing from wages sent home by these women. Lebanese families procure domestic positions through an employment agency that arranges transportation and entry for the Sri Lankan women. These women, especially minors, often have to bribe Sri Lankan government agents to falsify travel documents. Upon arrival in Lebanon, the women have no support systems or job security. Most employment contracts last 3 years and pay $100/month with no benefits or protection from local labor laws. Domestic workers are made vulnerable by employers who withhold salaries or travel documents. Upon return to Sri Lanka, former domestic workers face social disapproval and marital problems. To redress this situation, the governments of sending and receiving countries must take action to protect female migrant workers, and nongovernmental organizations must publicize the plight of these women and take action to address the abuses they face.     

MINIMUM WAGE EFFECTS WITH OUTPUT STABILIZATION

What are the effects of legal minimum wage rates on the U.S. economy? Does minimum wage legislation promote the economic self-interest of high wage union labor and impede the economic self-interest of capitalists as our earlier research [Cox and Oaxaca 1982] suggested? This paper uses a nine sector econometric/simulation model of U.S. industry from 1975–1978 to answer these questions in the context of stabilization policies which hold aggregate real output constant. While most simulated percentage effects are small, those for the unskilled workers themselves are not. A 15.7 percent increase in the average nominal wage rate of unskilled labor, as a result of minimum wage legislation, produced an 11 percent decrease in unskilled employment, 2.2 million jobs lost, while increasing the real wage of unskilled workers by 15 percent. Simulated changes in several key variables support our earlier observations that the self-interests of labor unions, with skilled workers, conflict with those of capitalists over the issue of minimum wage legislation.     

Effect of Health on Retirement of Older Americans: a Competing Risks Study

Retirement is an important event in the life of an individual. The decision to retire or exit from full-time employment may be motivated by several factors, including health. This paper explores the effect of both subjective and relatively more objective physical and mental health conditions on the probability of exit from full-time employment. Using longitudinal data on older Americans from ten waves of the Health and Retirement Study (1992–2010), eight health indices are created from a wide range of health measures by principal component analysis. The effect of these health indices on the time until exit from full-time employment is empirically examined in a proportional hazard model. Single and competing risk specifications are estimated that allow for multiple spells of full-time employment and control for unobserved heterogeneity. The main results suggest that better self-reported health decreases the likelihood of exit from full- time employment, while poor physical health (functional limitations factor) increases the likelihood of exit from full-time employment via complete retirement and disability. For mental health, I find that depression increases the likelihood of exit via complete retirement, part-time work and unemployment while cognitive disorders lead to an increase in likelihood of exit via the disability exit route. Hence, physical and mental health problems are both impediments to continued work. These results have implications for public policies targeted towards retaining older workers within the labor market.     

The Wages of Aging: Time-Related Determinants of Earnings in the Southern Textile Industry*

The author distinguishes three time-related worker characteristics: physical facility, skill, and firm attachment. In an analysis of wage determination for a sample of textile production workers physical facility and firm attachment, but not skill, had significant curvilinear effects, These, along with exogenous effects of gender and race and endogenous effects of assignments to machine maintenance and to a weave room, are interpreted as reflecting power relations in the contemporary context of the southern textile labor process and labor market. The analysis emphasizes the critical importance of contextual considerations in operationalization, specification, and interpretation for wage determination studies.     

The economic effects of labor unions revisited

Using a variety of statistical techniques, we conclude that labor unions have reduced U.S. output by significant amounts —trillions of dollars over time. Additionally, the employment- population ratio and the unemployment rate have been adversely affected by the presence of unions. From the very beginning, unionization materially lowered employment in the auto and steel industries, and union militancy in coal mining has contributed importantly to largely eliminating employment in this once large industry. While some individual workers have profited from unions, the aggregate economic impact is strongly negative.     

Unemployment,Reemployment, and Health Insurance Status Among Older Workers in the Flexible Labor Market

As employment becomes more precarious, and spells of displacement become more common across the labor market, many individuals are forced to make decisions about the speed at which they seek reemployment and the types of employment they will seek. Using repeated cross‐sectional data from various years of the Displaced Worker Supplement of the Current Population Survey, we examine the degree to which employer‐provided health insurance and organizational provision of advanced layoff warning helped workers—particularly those from earlier birth cohorts—navigate the labor market during a period of growing employment flexibility. Our results indicate that workers from older cohorts, rather than older chronological ages, suffered more from displacement in terms of longer unemployment spells and declines in job quality upon reemployment. Workers able to obtain a job with health insurance had shorter unemployment durations, while those displaced from jobs with health insurance remained unemployed for longer periods of time. Advance notice appears to reduce some of the disproportionately negative effects of displacement for older workers, perhaps by easing the shock of a psychological contract breach. Our findings point to the importance of historical and cultural factors in shaping labor market outcomes.     

Small employers and health benefits: findings from the 2002 small employer health benefits survey

Overall, 19 percent of small employers offering health benefits made changes to their health plan between 2001 and 2002. Sixty-five percent increased deductibles and co-pays; 35 percent switched insurers; 30 percent increased the employee share of the premium; and 29 percent cut back on the scope of benefits. Twenty-six percent increased the scope of benefits offered. Nearly one-quarter of small employers offering health benefits think their firm would change coverage and 3 percent think it would drop coverage if the cost were to increase an additional 5 percent. Most small employers offer sound business reasons for offering health benefits to workers. Many report that it helps with employee recruitment and retention, and increases productivity. More than three-quarters report that offering health benefits is "the right thing to do." Most small employers that do offer health benefits report that it has a positive impact on various aspects of the business, such as recruitment, retention, employee attitude and performance, employee health status, and the overall success of the business. Most small employers that do not offer health benefits tend to think that not offering them has no negative impact on the above aspects of their business or the overall success of the business. However, those not offering benefits are more likely than those offering them to report that most of their employees are high-turnover and stay on the job only a few months. Small employers that offer health benefits tend to be distinctly different from those not offering them. Worker income in firms not offering health benefits tends to be considerably lower than in firms that do offer them. Employers not offering health benefits are more likely than those offering them to have a smaller proportion of full-time employees, and employers that do not offer health benefits have a larger proportion of females, workers under age 30, and minority employees. Of small employers that offer dependent coverage, more than 40 percent report that workers do not take coverage for their dependents because the dependents have coverage from somewhere else, but 35 percent report that employees decline dependent coverage because they cannot afford the premiums. Many small employers that do not offer health benefits are potential purchasers. Eleven percent are either extremely or very likely to start offering health benefits in the next two years, and 22 percent are somewhat likely to start offering health benefits.     

The economic status of union workers in the United States

Although American labor unions evolved out of poverty, today’s typical union worker is relatively affluent. Current Population Survey data show that average annual household earnings in 2002 for full-time union workers were nearly $79,000, nearly double the median of all households (including ones with non-workers), and more than for nonunion worker households. While relatively few union workers are truly “poor,” a larger proportion (over one-third for members of teachers’ unions) comes from households with over $100,000 in annual income. A puzzle: why do union members tend to support liberal policies and politicians far more than their relative affluence would predict? Perhaps it partly reflects rent-seeking behavior.     

The costs of sharing: wives' employment and husbands' mental health.

Although there is general concern about the psychological effects of gender stratification, we know relatively little about the particular aspects of inequality that affect men and women's mental health. This paper proposes that inequalities in power and demands associated with gender are particularly consequential for well-being. Previous analyses on married women support this perspective: wives' employment is positive for women's well-being to the extent that it increases their income relative to husbands and decreases their domestic demands, particularly through husbands sharing in domestic labor. The present analysis extends the test of this perspective to men by examining the effects of wives' employment on husbands' psychological well-being. Results show that insofar as it decreases husbands' relative income and increases their share of domestic labor, women's employment is negative for husbands' mental health.     

LABOR MARKET EFFECTS OF EMPLOYER-PROVIDED HEALTH INSURANCE

This is an experimental study in economics of mandated benefits. Most individuals who have health insurance in the United States obtain it through their employer. Some states require employers to provide insurance to certain types of workers. We used an experimental laboratory to investigate possible effects of alternative health insurance regulations on the competitive labor market performance. We found that mandating the insurance for all workers creates labor market distortions, whereas mandating the insurance only for full-time workers leads to a higher coverage than under no mandate, an increased number of part-time workers, but does not necessarily lower market efficiency. ( JEL C92, I18, J2)     

Race and Gender Differences in Workplace Autonomy: A Research Note

While many studies have focused on race and gender differences in monetary labor market rewards, few studies have used national samples to examine race and gender differences in nonmonetary labor process rewards. Utilizing multivariate analysis on data from the 1993 and 1997 National Employee Survey, the present study examines how race and gender interact in shaping workplace autonomy. We regress an index of autonomy on human capital, structural level variables, and race and gender interaction terms. Findings show that black and white females, relative to white males, fare worse net of controls for human capital and structural level variables. Black males fare worse than white males when controlling for human capital but this disadvantage fails to retain its significant effect when controlling for structural level variables. We conclude that contrary to some beliefs that black females have experienced greater success in the labor market as a result of affirmative action policies, black females remain hindered by the double jeopardy of race and gender.     

Women’s Tertiary Education Masks the Gender Wage Gap in Turkey

This paper investigates the gender wage gap for full-time formal sector employees, disaggregated by education level. The gap between the labor force participation rate of women with tertiary education and those with lower levels of education is substantial. There is no such gap for men. Hence, existing gender wage gap studies for Turkey, where we observe lopsided labor force participation rates by education levels, compare two very different populations. We disaggregate the whole sample by education level to create more homogenous sub-groups. For Turkey, without disaggregation, the gender wage gap was 13% in 2011, and women are significantly over-qualified relative to men on observed characteristics. Once we disaggregate the sample by education level, we show that the gender wage gap is 24% for less educated women and 9% for women with tertiary education in full-time formal employment. Observed characteristics only explain 1 % of this gap in absolute terms. We further disaggregate the data by public and private employment. The gender gap is higher in the private sector. However, women with tertiary education in the public sector are significantly better qualified compared to men, and consequently the adjusted gender wage gap is higher for women with tertiary education in the public sector. Our estimates also indicate a rise in the gender wage gap between 2004 and 2011.     

Comparing Offers and Take‐ups of Employee Health Insurance across Race,Gender, and Decade*

How often do U.S. employees receive health insurance offers from employers? When offered, how often do they take up their employer‐based health insurance? This article uses the 1992 and 2002 waves of the National Study of the Changing Workforce (NSCW) to investigate changes in access to (offers) and employees electing to accept, take, or purchase their employers’ health insurance plans (take‐ups) among wage and salaried workers. Although much research has studied employee health benefits, little has examined the intersection of gender and race regarding both offers and take‐ups of such benefits. Logistic regression results indicate that offers and take‐ups of personal health benefits declined from 1992 to 2002, net of salient controls. Further analyses demonstrate that these declines did not affect all workers identically. Offers declined somewhat for both women and men among whites and African Americans, but declined more among Hispanic women and men. Among other ethnoracial groups, offers declined the most among men, but increased among comparable women. Take‐ups declined among white men and Hispanic workers. However, white and African American women's take‐ups did not change and among African American men take‐ups increased. We discuss the need to examine gender and race simultaneously and urge researchers to more closely examine changes in health benefit offers and take‐ups.     

The Effects of Being Out of the Labor Market on Subsequent Wages: Evidence for Uruguay

Based on administrative data combining workers’ earnings histories and unemployment insurance benefits, we document short and long term wage losses for a large sample of Uruguayan formal workers with high tenure. The contribution of this paper is to provide original evidence about job separation costs in a developing country, based on a unique array of social security and unemployment insurance administrative micro-data. Our main findings indicate that workers lose around 38 % of their previous wages in the first quarter after separation, and 1 year after, losses are still more than 14 %. If we consider earnings plus unemployment insurance benefits, losses at the quarter of separation are considerable lower, amounting 22 % of previous wages. We also provide original evidence about how wage losses vary across age groups, gender, industry and size of the firm. Differences between switchers and non switchers, as well as the effects of the economic cycle are also analyzed.     

EMPLOYMENT AND DEADWEIGHT LOSS EFFECTS OF OBSERVED NONWAGE LABOR COSTS

To assess the employment effects of labor costs, it is crucial to have reliable estimates of the labor cost elasticity of labor demand. Using a matched firm‐worker data set, we estimate a long‐run unconditional labor demand function, exploiting information on workers to correct for endogeneity in the determination of wages. We evaluate the employment and deadweight loss effects of observed employers' contributions imposed by labor laws (health insurance, training, and taxes) as well as of observed workers' deductions (social security and income tax). We find that nonwage labor costs reduce employment by 17% for white collars and by 53% for blue collars, with associated deadweight losses of 10% and 35% of total contributions, respectively. Since most firms undercomply with mandated employers' and workers' contributions, we find that full compliance would imply employment losses of 4% for white collars and 12% for blue collars, with respective associated deadweight losses of 2% and 6%. (JEL J23, J32)     

Structural changes in the receiving country and future labor migration--the case of Kuwait

This article describes changes in the volume, age and sex composition, retention, productivity, types of occupation, and economic sector of the labor force in Kuwait. The focus is on the structural changes in the indigenous labor force. Data were obtained from censuses and labor force surveys during 1965-93. Policies after the 1990 invasion pertained primarily to security of public employment sector among natives. Over 98% of private sector employment is among non-Kuwaitis. Government programs support high fertility. Female illiteracy has declined, and the proportion of women with a higher education has increased. Natives comprised 20.4% of the total labor force in 1993. About 90% of native males work in the public sector. 45% of total male employment is in the production sector. Around 50% of non-Kuwaiti males have been employed in production work over the decades. Over 90% of Kuwaiti females in 1993 worked in professional or clerical work. Over 50% of total female labor force participation is in the service sector. Concentration in the public sector increased for Kuwaitis and declined for non-Kuwaitis. Labor force participation declined with increasing age. Retirement benefits encouraged early retirement. The private sector is experiencing the departure of long-term migrants and more rapid turnover of labor. Hours of work are longer in the private sector. Kuwait is still dependent on foreign workers in the production and service industries. It is likely that native male workers will replace foreign workers in professional work and administrative/clerical work. Policies that will assure future reliance on imported labor include the assurance of government jobs for Kuwaitis, retirement rules, and the profitability of the trade in labor.     

Race differences in the effects of multiple roles on health: longitudinal evidence from a national sample of older men.

This paper examines race differences in the effects of social roles on physical health. Using data from the older men cohort of the National Longitudinal Surveys of Labor Market Experience, we examine the impact of employment, marriage, and being a supporter on health limitations and mortality. Employment has the most consistent health-protective effect, and the benefits of employment are more pronounced for Blacks than for Whites. Marriage affects health in conjunction with employment. These findings lend further support to the growing literature on the effects of roles on health. The results further illustrate the importance of ascribed statuses as structural determinants of the relationship between roles and health, highlighting the very real differences in the meanings and expectations of social roles for Blacks and Whites.