Local Labor Market Shocks And Family Outcomes
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| Author | : Jessamyn Schaller |
| Publisher | : |
| Total Pages | : |
| Release | : 2012 |
| Genre | : |
| ISBN | : 9781267663849 |
While the most often-cited impacts of negative shocks to local labor market shocks are those to individuals' earnings and employment status, the repercussions of economic recession extend beyond these direct labor market effects. My dissertation research explores the effects of local labor market shocks and job displacement on families. Together, the three chapters of my dissertation contribute a better understanding of the overall welfare impacts of business cycle fluctuations. Chapter 1 examines the effect of local labor markets on fertility. To identify exogenous variation in male and female labor demand, I create indices that exploit cross-sectional variation in industry composition, changes in gender-composition within industries, and growth in national industry employment. Consistent with economic theory, I find that improvements in men's labor market conditions are associated with increases in fertility while improvements in women's labor market conditions have the opposite effect. I separately find that increases in unemployment rates are associated with small significant decreases in birth rates. In Chapter 2, I study the effect of business cycles on marriage and divorce rates. I find that increased unemployment is associated with small but significant reductions in both marriages and divorces. The results are robust to replacing general unemployment rates with alternative measures of state economic health, hold for both blacks and whites, and are concentrated among working-aged individuals. Timing analysis suggests that the effect of a shock to the unemployment rate on marriage rates is permanent, while the effect on divorce rates is temporary. In Chapter 3, Ann Stevens and I study the relationship between parental job loss and children's academic achievement using data on job loss and grade retention from the Survey of Income and Program Participation. We find that a parental job loss increases the probability of children's grade retention by 0.8 percentage points, or around 15 percent. After conditioning on child fixed effects, there is no evidence of significantly increased grade retention prior to the job loss, suggesting a causal link between the parental employment shock and children's academic difficulties. These effects are concentrated among children whose parents have a high school education or less.
| Author | : Timothy J. Bartik |
| Publisher | : |
| Total Pages | : 52 |
| Release | : 2014 |
| Genre | : Job creation |
| ISBN | : |
This paper estimates how effects of shocks to local labor demand on local labor market outcomes vary with initial local economic conditions. The data are on U.S. metro areas from 1979 to 2011. The paper finds that demand shocks to local job growth have greater effects in reducing local unemployment rates if the local economy is initially depressed than if the local economy is booming. Demand shocks have greater effects on local wage rates if the local unemployment rate is initially low, but lesser effects if local job growth is initially high. These different effects of local demand shocks imply that social benefits of adding jobs are two to three times greater per job in more depressed local labor markets, compared to more booming local labor markets.
| Author | : Yiming Li |
| Publisher | : |
| Total Pages | : 95 |
| Release | : 2018 |
| Genre | : |
| ISBN | : 9780438084438 |
This dissertation studies the impacts of local labor market changes on the US family structures and disability benefit take-up. The dissertation uses unexpected time series changes in energy prices, together with the pre-existing county exposure to the unexpected time series changes, to identify causal links between the changes in county's economic conditions and changes in marriage outcomes, fertility outcomes, and disability benefit payments.
| Author | : Kjell G. Salvanes |
| Publisher | : |
| Total Pages | : 65 |
| Release | : 2022 |
| Genre | : Human capital |
| ISBN | : |
Adverse economic shocks occur frequently and may cause individuals to reevaluate key life decisions in ways that have lasting consequences for themselves and the broader economy. These life decisions are fundamentally tied to specific periods of an individual's career, and economic shocks may therefore have substantially different impacts on individuals -- and the broader economy -- depending on when they occur. We exploit mass layoffs and establishment closures to examine the impact of adverse shocks across the life cycle on labor market outcomes and major life decisions: human capital investment, mobility, family structure, and retirement. Our results reveal substantial heterogeneity on labor market effects and life decisions in response to economic shocks across the life cycle. Individuals at the beginning of their careers invest in human capital and relocate to new local labor markets, individuals in the middle of their careers reduce fertility and adjust family formation decisions, and individuals at the end of their careers permanently exit the workforce and retire. As a consequence of the differential interactions between economic shocks and life decisions, the very long-term career implications of labor shocks vary considerably depending on when the shock occurs. We also document important heterogeneity across genders and education levels, both with respect to the immediate impact as well as the sum total of all these effects in the very long-term. We conclude that effects of adverse labor shocks are both more varied and more extensive than has previously been recognized, and that focusing on average effects among workers across the life cycle misses a great deal.
| Author | : Xavier Giroud |
| Publisher | : |
| Total Pages | : 0 |
| Release | : 2016 |
| Genre | : |
| ISBN | : |
Local labor market shocks are difficult to insure against. Using confidential micro data from the U.S. Census Bureau's Longitudinal Business Database, we document that firms redistribute the employment impacts of local demand shocks across regions through their internal networks of establishments. During the Great Recession, the massive decline in house prices caused a sharp drop in consumer demand, leading to large employment losses in the non-tradable sector. Consistent with firms smoothing out the impacts of these shocks across regions, we find large elasticities of non-tradable establishment-level employment with respect to house prices in other counties in which the firm has establishments. At the same time, establishments of firms with larger regional networks exhibit lower employment elasticities with respect to local house prices in the establishment's own county. To account for general equilibrium adjustments, we aggregate non-tradable employment at the county level. Similar to what we found at the establishment level, we find that non-tradable county-level employment responds strongly to local demand shocks in other counties linked through firms' internal networks. These results are not driven by direct demand spillovers from nearby counties, common shocks to house prices, or local demand shocks affecting non-tradable employment in distant counties indirectly via the trade channel. Our results suggest that firms play an important role in the extent to which local labor market risks are shared across regions.
| Author | : Timothy J. Bartik |
| Publisher | : |
| Total Pages | : 0 |
| Release | : 2022 |
| Genre | : Job creation |
| ISBN | : |
This paper estimates the effects on local labor market outcomes (employment rates, real wages, real earnings) of local labor demand shocks to different types of occupations. Occupations are divided into three groups, “high, middle, and low,” with occupations differing in wages paid and education credentials required. Effects are considered on both workers with less than a four-year college degree and workers with a bachelor’s degree or higher. The strongest benefits for labor market outcomes come from demand shocks to “mid jobs.” Mid-job demand shocks particularly benefit less-educated workers. High-job demand shocks often hurt labor market outcomes for less-educated workers, in part because such shocks push up local prices. Low-job demand shocks sometimes improve labor market outcomes for less-educated workers, and sometimes damage labor market outcomes for more-educated workers. Estimated labor demand effects also vary in different types of local labor markets. For example, when baseline local labor market conditions are tight (high baseline employment rate), less-educated workers gain more in real earnings from low-demand shocks, and lose more in real earnings from high-demand shocks.
| Author | : Itzik Fadlon |
| Publisher | : |
| Total Pages | : |
| Release | : 2015 |
| Genre | : |
| ISBN | : |
This paper provides new evidence on how household labor supply responds to fatal and severe non-fatal health shocks in the short- and medium-run. To identify the causal effects of these shock realizations, we leverage administrative data on families' health and labor market outcomes, and construct counterfactuals to affected households by using households that experience the same shock but a few years in the future. We find that fatal health shocks lead to an immediate increase in the surviving spouses' labor supply and that this effect is entirely driven by families who experience significant income losses. Accordingly, widows, who face large income losses when their husbands die, increase their labor force participation by more than 11%; while widowers, who are significantly more financially stable, slightly decrease their labor supply. Notably, however, the patterns of sensitivity to comparable income changes are similar across genders. In contrast to fatal shocks, we find that non-fatal health shocks--in particular, heart attacks or strokes--have no meaningful effects on spousal labor supply, consistent with the adequate insurance coverage for the associated foregone income. Overall, the results point to self-insurance as a driving mechanism for the family labor supply responses that we estimate. Combined with a stylized model, our findings suggest efficient ways to target government transfers through existing social insurance programs.
| Author | : Timothy J.. Bartik |
| Publisher | : |
| Total Pages | : 40 |
| Release | : 1993 |
| Genre | : Labor demand |
| ISBN | : |
| Author | : Timothy J. Bartik |
| Publisher | : |
| Total Pages | : 96 |
| Release | : 1999 |
| Genre | : Labor market |
| ISBN | : |
Based on state-level labour market data from the Outgoing Rotation Group of the Current Population Survey from 1979 to 1997, discusses the wage and displacement effects of supply and demand shocks.
| Author | : |
| Publisher | : |
| Total Pages | : 0 |
| Release | : 2013 |
| Genre | : |
| ISBN | : |
My dissertation examines how changing labor market conditions in the post 1970s era, characterized by the deterioration and polarization of job opportunities and quality, have impacted key family outcomes in the United States. For this purpose, I use data from the National Longitudinal Survey of Youth 1979 and the NLSY79 Children and Young Adults to examine the relationships between various indicators of job quality and three key family outcomes: namely, marital formation, marital dissolution, and children's health. Built upon the growing body of literature on "bad jobs" and labor market changes, I incorporate various indicators of job quality, including the provision of health and pension benefits, nonstandard work schedules, and nonstandard employment. Study findings suggest that job quality may be an important economic indicator for family outcomes (either practical or symbolic). I find that having employment with "bad job" characteristics, especially the lack of health insurance and pension benefits, significantly delays men's transition to first marriage. In addition, women's job quality is important for marital stability in that working in jobs without health insurance decreases the risk of divorce among women. I also find that a mother's low-quality nonstandard employment (e.g., part-time, contract work) is detrimental to her children's health, particularly so in single-mother families. The absence of health insurance from mother's nonstandard employment is associated with worse health outcomes for children in single-mother families than those in two-parent families. As the first study to incorporate various measures of "bad job" quality in key family outcomes, my dissertation contributes to the theoretical discussions of the causes of family inequality since deteriorating job quality and increasing labor market inequality have been hypothesized as leading influences on family changes but have not yet been empirically tested. Beyond theory, my research can also inform policy debates surrounding the linkages between work, family, and the well-being of both adults and children, as well as the implications of these relationships for the increasing inequality in the U.S. in the context of labor market changes.
