Who benefits from job placement services? A two-sided analysis

In light of additional information market agents would achieve better outcomes, for example, a lower ask price for the buyer and a higher offer price for the seller. I examine this notion in a labor market, where employers and employees do not possess perfect information about wages, and address the question of who benefits from the information provided by job placement services? The empirical strategy considers the two-sided nature of the labor market. Estimates of employee and employer incomplete information are contrasted between users and non-users of placement services provided by Job Corps, America’s largest and most important job training program for youths. Findings suggest that employees that use placement services don’t have more information about better offer wages, relative to non-users. Interestingly, firms that employed users of placement services are better informed about reservation wages relative to firms that employed non-users.     

Stop wasting your training dollars! How to use integrative learning

To succeed in today's competitive world, companies need to continually train their employees to do new jobs and to perform old jobs better. Unfortunately, most on-the-job education and training is wasted, since traditional methods do not get workers to retain what they have learned. This article describes a new method of education, integrative learning, that takes into account that each person has multiple kinds of intelligence and also has his or her own style of learning. By changing the learning environment and the way information is presented, processed, and used in the classroom, integrative learning produces substantially better results than traditional methods.     

The Living Wage and the Effects of Real Minimum Wages on Part-Time and Teen Employment

In many parts of the country, campaigns are being carried out and laws are being passed whose aim is to establish, among other things, standards for contracting out public services and setting acceptable living wages that will provide employees decent living standards. Living wages have economic consequences on employment of different groups of workers such as part-time, teenagers, and women and detailed data are needed to measure those effects. In the absence of such data and because of the strong link between living and minimum wages, this study tests the potential impact of living wages by using the model of minimum wages. The study documents a negative and significant relationship between real minimum wages and the employment levels of the various groups. The study also recommends better training and education, free competition in the labor market, and fair compensation based on the workers productivity as justifiable means to achieve a sustainable level of living wages without causing an unemployment repercussion.     

Management commitment and company policies on education and training

This article presents evidence from a 1991 survey of 406 large companies indicating that corporate education and training practices are shaped by four company characteristics: (1) human resource innovativeness, (2) management resistance to change, (3) work redesigns to enhance quality and involvement, and (4) firm downsizing. When managements create an innovative climate, their companies invest more in worker retraining and contribute more to public schooling; when they resist change, they find it more difficult to recruit entry-level employees. When managements redesign work, their companies place greater emphasis on training, development, and school relations. When managements downsize, their companies take more interest in entry-level training and apprenticeship programs. © 1993 by John Wiley & Sons, Inc.     

If You Are So Smart,Why Aren't You an Entrepreneur? Returns to Cognitive and Social Ability: Entrepreneurs Versus Employees

How valuable are cognitive and social abilities for entrepreneurs’ relative to employees’ earnings? We answer three questions: (1) To what extent does a composite measure of ability affect an entrepreneur's earnings relative to wages earned by employees? (2) Do different cognitive abilities (e.g., math ability, language, or verbal ability) and social ability affect earnings of entrepreneurs and employees differently?, and (3) Does the balance in these measured ability levels affect an individual's earnings? Our (difference‐of‐difference) estimates of the returns to ability for spells in entrepreneurship versus wage employment account for selectivity into entrepreneurial positions insofar as they are determined by fixed individual characteristics. Our robust results provide the following answers to the three questions: General ability has a stronger impact on entrepreneurial incomes than on wages. Moreover, entrepreneurs and employees benefit from different sets of specific abilities: verbal and clerical abilities have a stronger impact on wages, whereas mathematical, social, and technical ability are more valuable for entrepreneurs. The balance in the various kinds of ability also generates a higher income, but only for entrepreneurs: This finding supports Lazear's Jack‐of‐all‐Trades theory.     

Minimum wages and training

The paper analyzes the influence of minimum wages on firms' incentive to train their employees. We show that this influence rests on two countervailing effects: minimum wages (i) augment wage compression and thereby raise firms' incentives to train and (ii) reduce the profitability of employees, raise the firing rate and thereby reduce training. Our analysis shows that the relative strength of these two effects depends on the employees' ability levels. Our striking result is that minimum wages give rise to skills inequality: a rise in the minimum wage leads to less training for low-ability workers and more training for those of higher ability. In short, minimum wages create a ”low-skill trap.” We indicate that this effect may be important empirically. Finally, including workers' incentives to train themselves makes no major difference to our results.     

The transition into management by scientists and engineers: A misallocation or efficient use of human resources?

A theme in the career paths of scientists and engineers is their transition into management. This transition is described as difficult both for those who make it and for those who do not. This article uses Human Research Information System data from a large research & development firm to explore an alternative perspective in which the transition is seen as an efficient human resource promotion strategy. The results support the alternative explanation and indicate that the policy serves the firm well in allocating human resources. The results suggest that good technical employees tend to become good managers and that if coupled with aggressive training for those technical employees who do not move into management, the best workers stay with the firm.     

The early inception of labor market gender differences

This paper analyzes gender differences in jobs while in school using school-class-based samples, a setting in which education differences, “glass ceilings”, and career interruptions due to parenthood are irrelevant. I find that in this early stage of life boys already earn substantially more than girls. The earnings gap cannot be explained by differences in participation rates and hours of work, nor by gender wage gaps within job types. It is entirely due to the fact that girls work more in job types with relatively low wages, in particular babysitting. During the period considered, 1984–2001, the gender patterns of jobs while in school largely remained unchanged.     

The effects of pension rights and retirement age on training participation: Evidence from a natural experiment

This paper uses a natural experiment approach to identify the effects of an exogenous change in future pension benefits on workers' training participation. We use unique matched survey and administrative data for male employees in the Dutch public sector who were born in 1949 or 1950. Only the latter were subjected to a major pension reform that diminished their pension rights. We find that this exogenous shock to pension rights postpones expected retirement and increases participation in training courses among older employees, although exclusively for those employed in large organizations.     

Access to training and its impact on temporary workers

Does temporary work provide a way for individuals to improve their skill levels? Using a sample of more than 4,000 employees of US temporary staffing agencies, we analyse whether blue, white and pink‐collar temps get access to company training, and the impact of skill development on wages and employee retention. We find that less than 25 per cent of temps take part in training. Educated and experienced individuals are more likely to be offered training, but lower‐skilled individuals are more likely to take training when it is offered and spend more hours on it. Office workers who took part in training were more likely still to be with the agency a year later and experienced significant wage growth, while training had no effect on wage growth for blue‐collar workers. Skill development that took place on the job was associated with greater wage growth for all types of temps.     

The benefits and costs of training: A comparison of formal company training,vendor training,outside seminars,and school-based training

This paper presents estimates of the amount of training received by a large sample of United States adults aged 23–35 and uses a more sophisticated model than many previous studies to analyze training's impact on earnings. While workers reap substantial benefits from training, only a small minority actually receive it. Workers generally do not work fewer hours or accept lower wages during training, so they apparently bear few training costs. The low incidence of training may be due to Federal regulations that prevent employers from sharing training costs with their employees. Implications for managers, employees, and society are discussed. & copy; 1996 by John Wiley & Sons, Inc.     

Youth Training Scheme 'Voucher'

Education forms another arm of the welfare state. The school. voucher was dropped in 1983 partly because of the argument that it would be impossible to create the wide-range of schools necessary to redeem it in primary and secondary education. John Pardoe (right), former Liberal MP, who runs courses for the Youth Training Scheme of the Manpower Services Commission, has found that 4,000 sources of supply emerged, from 'Nowhere' to honour the YTS grants to young people. His evidence confirms the Austrian argument that suppliers would soon emerge in response to the new, voucher-stim ulaied demand.     

Wage determination in the union and nonunion sectors.

This study contains estimates of wage equations for white male union and nonunion employees. The authors find that nonunion wages are generally more responsive than union wages to individuals' education and experience and to regional price-level variation. Despite those differences, however, estimates of union-nonunion wage differentials based on these separate equations do not differ greatly from a differential obtained from a union dummy variable in an equation based on combined union and nonunion observations. Union-nonunion differentials vary widely across occupational groups and are generally larger in the lower skilled and more highly unionized occupations. The results for manufacturing, for which additional industry data are available, indicate a negative impact of high concentration ratios on the wages of all workers and a greater impact of establishment size on nonunion than on union wages. Data were drawn from the May 1973 Current Population Survey.     

THE COLLAPSE OF PRIMARY SCHOOLING RETURNS IN SOUTH AFRICA 1960–90

By 1975, the effect of a year's primary schooling upon the wages of Africans in South Africa had fallen to about 2.5 percent — one of the lowest primary schooling returns in the world. Secondary schooling returns were high throughout the period 1960–90. The collapse of primary schooling returns was due to declining school quality, an increase in the supply of primary school graduates, an increase in mining wages in the mid-seventies, and wage regulation by the Industrial Councils and Wage Boards. The low level of the return, compared with the returns to other races in South Africa, is due to the low quality of African primary schools. Implications for education spending patterns and wage regulation are pointed out.     

Human Resource Responsibilities: Frequent Flyer Radiation Exposure

At the high altitudes that are the domain of commercial airliners, passengers are exposed to cosmic radiation at an intensity that is hundreds of times greater than at ground level. Such radiation exposure represents a risk for individuals who fly frequently as part of their job. Business travelers who fly at least 85,000 miles (137,000 km) per year are likely to receive radiation exposures that exceed the regulatory limit established for members of the general public exposed by proximity to medical or industrial radiation facilities. Their exposures will not, however, exceed the higher level allowed for radiation workers. Human resource managers need to identify those employees who fly frequently on company business or due to a company-initiated relocation (e.g., expatriate assignment), classify them as radiation workers, and ensure compliance with the regulatory requirements for providing risk education and exposure assessment for such workers. Failure to do so may incur potential liability for radiation-related health problems, particularly in the case of pregnant employees where the embryo or fetus is also at risk.     

The transfer of Japanese work practices to plants in Thailand

This paper analyses two Japanese transplants that have been manufacturing products in Thailand for a number of years. The research shows that these transplants have not fully adopted three Japanese work practices that are characteristic of workplaces in Japan (the significant troubleshooting skills possessed by production workers, the production support work provided by assistant first-line supervisors and the overlapping roles of manufacturing engineers). The low wages and the subdivided job consciousness of Thai employees, the presence of Japanese expatriates who are not familiar with the workplace practices actually used in Japan and the fact that the transplants have manufactured standardized mature products that do not require high troubleshooting skills, are found to be the main causes for the incomplete transfer of work practices from the mother company.     

Educational mismatch,wages, and wage growth: Overeducation in Sweden, 1974–2000

We examine the impact of educational mismatch on wages and wage growth in Sweden. The empirical analyses, based on cross-sectional and panel data from the Level of living surveys 1974–2000, are guided by two main hypotheses: (a) that educational mismatch reflects human capital compensation rather than real mismatch, and (b) that educational mismatch is real but dissolves with time spent in the labour market, so that its impact on wages tends toward zero over a typical worker's career. Our findings do not support these hypotheses. First, significant differences in contemporaneous economic returns to education across match categories remain even after variations in ability are taken into account. Second, we find no evidence that the rate of wage growth is higher among overeducated workers than others. Our conclusion is that the overeducated are penalized early on by an inferior rate of return to schooling from which they do not recover.     

Training,productivity and wages in Italy

This paper presents for the first time panel evidence on the productivity and wage effects of training in Italy. It is based on an original dataset which has been created aggregating individual-level data on training with firm-level data on productivity and wages into an industry panel covering all sectors of the Italian economy for the years 1996–1999. I use several modelling specifications and a variety of panel data techniques to argue that training significantly boosts productivity. However, no such effect is uncovered for wages. This seems to suggest that firms do actually reap more of the returns.     

Trainers' dilemma of choosing between training and promotion

In the work environment, older employees play a significant role in training younger employees. Why do older employees provide this training when they are rivals competing for promotion? Is it because the more training they provide to trainees, the less likely those trainers will be promoted? We show that the fostering of generalists rather than specialists can soften the trainers' dilemma of choosing between training and promotion because the amount of training provided by a trainer decreases that trainer's promotion probability to a greater extent when training specialists than when training generalists. Hence, even if the productivity of the generalist is lower than that of the specialist, the generalist scheme can still lead to a higher level of training and improve a firm's profit and social welfare.     

Do Better Wages Reduce Crime? A Research Note

A bstract . Recent research has called into question theoretical and empirical findings demonstrating a deterrent effect of punishment. Also challenged has been the view that improved employment opportunities help to reduce participation in illegitimate activities. This research note summarizes newly published econometric findings revealing that better wages and employment indeed do appear to reduce individual recidivism rates, at least in the major data set studied. The data are drawn from the Baltimore LIFE experiment. Maximum likelihood methods are used to estimate the probability of recidivism one year after release from prison and the probability of avoiding rearrest or "survival" each month after release from prison. It is found that higher average weekly wages are associated with lower recidivism and higher survival rates. In contrast, no evidence is found to confirm a deterrent effect of punishment. [Complete documentation is published in S. L. Myers, Jr "Estimating the Economic Model of Crime: Employment vs. Punishment Effects,".