Archives for employment



The Gender Wage Gap, by State

We have blogged and written extensively about the gender pay gap, much of which is not attributable to discrimination, as is commonly invoked. President Obama has taken up the cause; he recently signed two executive orders aimed at closing the gap.  Business Insider recently posted a state-by-state breakdown of the gender wage gap. It is interesting to look at but keep in mind the non-discriminatory factors that contribute to the gap, and therefore consider these numbers with some skepticism:

Wyoming has the biggest pay gap — the median male full-time worker made $51,932, and the median female full-time worker made $33,152. The male worker thus made 56.6% more than the female worker.

Washington, D.C. had the smallest gap — there, men make 11.0% more than women. Among the states, Maryland and Nevada had the smallest gaps, both at 17.2%.



Why Do Some Jobs Pay So Little?

A recent one-day strike by fast-food workers has called attention to the low wages in the industry. James Surowiecki offers one reason that the issue’s visibility has increased recently:

Still, the reason this has become a big political issue is not that the jobs have changed; it’s that the people doing the jobs have. Historically, low-wage work tended to be done either by the young or by women looking for part-time jobs to supplement family income. As the historian Bethany Moreton has shown, Walmart in its early days sought explicitly to hire underemployed married women. Fast-food workforces, meanwhile, were dominated by teen-agers. Now, though, plenty of family breadwinners are stuck in these jobs. That’s because, over the past three decades, the U.S. economy has done a poor job of creating good middle-class jobs; five of the six fastest-growing job categories today pay less than the median wage. That’s why, as a recent study by the economists John Schmitt and Janelle Jones has shown, low-wage workers are older and better educated than ever. More important, more of them are relying on their paychecks not for pin money or to pay for Friday-night dates but, rather, to support families. Forty years ago, there was no expectation that fast-food or discount-retail jobs would provide a living wage, because these were not jobs that, in the main, adult heads of household did. Today, low-wage workers provide forty-six per cent of their family’s income. It is that change which is driving the demand for higher pay.

Given that reality, Surowiecki writes, raising the minimum wage by a few bucks a hour won’t fix the problem. His prescription: more truly middle-class jobs and an expansion of the social safety net. “Fast-food jobs in Germany and the Netherlands,” he writes, “aren’t much better-paid than in the U.S., but a stronger safety net makes workers much better off.”



How LinkedIn Is Changing Recruiting

Sarah Halzack, writing for The Washington Post, explores how LinkedIn is changing job-searching and recruiting:

As LinkedIn has exploded — perhaps because it has exploded — there has been a major shift in the way employers find new workers. Gone are the days of “post and pray,” a recruiter’s adage for the practice of advertising a job opening and then idly hoping that good candidates swim up to the bait.

Now the process of talent acquisition is something of a hunt.

“We’re really at a point now where all of your employees are vulnerable to being poached. Every single one,” said Josh Bersin, principal and founder of talent consulting firm Bersin by Deloitte.

The change is happening rapidly: A 2013 study by the Society for Human Resource Management found that 77 percent of employers are using social networks to recruit, a sharp increase from the 56 percent who reported doing so in 2011. And among the recruiters using social tools, 94 percent said they are using LinkedIn.

Recruiter Chris Scalia told Halzack that the type of candidates he sees on LinkedIn is also changing. “LinkedIn was always known for where you would go to find that really critical, challenging hire,” Scalia said. “It was never really where you would go for a PC technician or something at the lower end of the career mobility scale. Now I see both. It is completely flooded.”

(HT: The Big Picture)



Kerwin Charles, Erik Hurst, and Matt Notowidigdo on the U.S. Labor Market

Three of my colleagues and friends at the University of Chicago – Kerwin Charles, Erik Hurst, and Matt Notowidigdo — recently presented some new research that aims to understand the ups and downs in the U.S. labor market.  It’s more serious and important than the usual stuff we deal with on the blog, but every once in a while we deviate from trivialities when something really good comes along. 

They’ve been kind enough to put together a layperson’s version of the research below.  For those looking for the full-blown academic version, you can find that here.

A Structural Explanation for the Weak Labor Market
By  Kerwin Charles, Erik Hurst, and Matt Notowidigdo

In the aftermath of the Great Recession, the labor market has remained anemic.  Between 2007 and 2010, the employment-to-population ratio of men between the ages of 21 and 55 with less than a four-year degree fell from 82.8 percent to 73.8 percent.  As of mid-2012, the employment-to-population ratio for these men remained depressed at 75.6 percent.[1] 

In our new working paper (abstract; full PDF), we show that the recent sluggish labor market in the U.S. – particularly for prime age workers without a college degree – can be traced back to the large sectoral decline in manufacturing employment that occurred during the 2000s.  After decades of relative stability, total manufacturing employment in the U.S. fell by 3.5 million jobs between the beginning of 2000 and the end of 2007 (see chart below).  These manufacturing jobs were lost even before the Great Recession started.  During the recent recession, another 2 million manufacturing jobs were lost.  While there is talk of a recent manufacturing rebound in the U.S., the recent increase is only a tiny fraction of the total manufacturing jobs lost during the 2000s. Read More »



The Return of the Freelance Economist

A few weeks back, we posted a query from a young economist who, before heading for the job market, was looking to pick up  freelance work. She (yes, she) promised to report back with her progress, and now she has:

Thank you for posting my email. I received a decent handful of responses, but was not flooded with emails. I did get one big project that I am very excited about and will carry me through to the job market, so it worked out very well for me, but is probably not a good career strategy. I had no idea what to charge, so started with the rate I would have received from the employer that didn’t work out, which was clearly too high. I tried to make it clear that it was negotiable, but fear I may have scared off a few people.

Read More »



Love Behavioral Economics? Want to Work for the British Government? All Right Then …

A lot of people write to us looking for work — which, sadly, we are nearly always unable to provide. But once in a while we do hear of a good opportunity for the Freakonomically inclined. To wit:

The U.K. Cabinet Office’s Behavioural Insight Team — better known as the Nudge Unit because of its allegiance to the excellent Richard Thaler/Cass Sunstein book Nudge — is looking to expand. Here’s the job listing. Some relevant excerpts:

Successful candidates will need to show that they:
1. have a good understanding of the behavioural science literature
2. have an understanding and ideally ability to conduct randomised controlled trials to test policy interventions; and
3. are highly motivated individuals capable of developing innovative solutions to often complex policy problems.
4. are strong team players

Candidates should be prepared to work on potentially any aspect of government or wider public sector policy. For example, over the past year the team has led work on health, energy, fraud, electoral registration, charitable giving, consumer affairs, the labour market, and access to finance for SMEs [that's Euro-speak for "small and medium enterprises"]

Read More »



A Cheap Employee Is … a Cheap Employee: A New Marketplace Podcast

Our latest Freakonomics Radio on Marketplace podcast is called “A Cheap Employee Is … a Cheap Employee.” 

(You can download/subscribe at iTunes, get the RSS feed, listen via the media player above, or read the transcript below.)

It’s about the question of whether low-paid employees are indeed a good deal for a retailer’s bottom line as the conventional wisdom states.

The piece begins with a couple of stories from blog readers, Eric M. Jones and Jamie Crouthamel, which were solicited earlier here. (One of the true pleasures of operating this blog is having a channel by which to turn readers into radio guests — thanks!) Read More »



Are Fake Resumes Ethical for Academic Research?

“Audit studies” have been popular in labor economics research for 10 years.  The researcher sends resumés of artificial job applicants in response to job openings. Typically there is a crucial difference in some characteristic of the person that indicates a particular racial/gender/ethnic or other group to which one person within a pair of resumés belongs while the other does not.  The differential response of employers to the difference in the characteristic implied by the resumés is taken as a measure of discrimination in hiring.

Is this ethical?  Read More »