Additional references: Organisation of work (Part 2)

Additional references: Organisation of work (Part 2)

Phuah Eng Chye (13 April 2019)

Skills and training

The Council of Economic Advisers (February 2018) “Addressing America’s reskilling challenge”.

In the US, investment in skill development is largely “frontloaded” during the first 25 years of life. After that, public contributions are small and employer training represents the most sizable investment in further developing workforce skills. Restrictions on the use of Federal funds may not be optimal for the future reskilling challenges, especially those linked to trade and technological change. Additionally, there is an information gap. Workers and educational institutions are separated from employers by an information gap that makes it difficult to prepare the workforce with the skills employers seek. Coordination among parties is crucial for addressing the reskilling challenge.

Lolade Fadulu (4 January 2018) “Why is the U.S. so bad at worker retraining?” The Atlantic.

Hâle Utar (6 December 2018) “You are needed but not your skills: Challenges to manufacturing workers in the wake of globalisation”.

The impact of trade shocks on labour market shifts is usually studied in the context of re-training and social welfare frictions. Using evidence from Denmark, this column shows how workers can experience long-run reductions in earnings no matter how easy it is to change sector. A sudden and obligatory shift toward a new sector may generate some worker dissatisfaction.

Chiara Cavaglia, Sandra McNally, Guglielmo Ventura (September 2018) “Do apprenticeships pay? Evidence for England”. CEP Industrial Strategy.

We analyse the payoff to apprenticeships for young people in the short term (23 years old) and after a few years (28 years old) in terms of employment and earnings. Our results suggest a positive earnings differential on average. However, there is huge variability in the estimated earnings differential between sectors and this has important implications for the gender earnings gap because of the different choices made by men and women.

The labour movement

Mehtap Akgüç, Miroslav Beblavý, Zachary Kilhoffer, Elina Cirule (21 December 2018) “Industrial relations and social dialogue in the age of collaborative economy: Comparative report”. CEPS.

The IRSDACE (Industrial Relations and Social Dialogue in the Age of Collaborative Economy) project aims to identify how traditional players in the labour market experience and respond to the collaborative economy. This final project output brings the national case study results together in a comparative study, the results of a cross-country online survey of platform workers, and an assessment of how platform economy issues are being addressed globally, particularly in the US, China and India.

David Madland (9 April 2018) “Wage boards for American workers: Industry-level collective bargaining for all workers”. Center for American Progress.

Arindrajit Dube (February 2019) “Using wage boards to raise pay”. Economics for Inclusive Prosperity.

Lane Kenworthy (15 September 2018) “Can codetermination help fix America’s wage problem?”

Bryan Menegus (26 September 2018) “Amazon’s aggressive anti-union tactics revealed in leaked 45-minute video”. Gozmodo.

Hayley Peterson (11 September 2018) “Missing wages, grueling shifts, and bottles of urine: The disturbing accounts of Amazon delivery drivers may reveal the true human cost of free shipping”. Business Insider.

Hayley Peterson (21 September 2018) “Someone is going to die in this truck: Amazon drivers and managers describe harrowing deliveries inside trucks with bald tires, broken mirrors, and faulty brakes”. Business Insider.

Hayley Peterson (January 2019) “Flex is dead: Drivers claim Amazon Flex delivery jobs are disappearing”. Business Insider.

Rachel Premack (September 2018) “The US has a major truck driver shortage – but the co-founder of a trucking startup that’s attracted $80 million in funding says there are 3 other issues that are making the shortage seem worse than it is”. Business Insider.

Rachel Premack (14 February 2019) “A top trucking company just declared bankruptcy – and Amazon may have helped usher its downfall”. Business Insider.

Rachael Premark (23 February 2019) “A truck driver protest that was supposed to rock Indianapolis had fewer than 80 trucks — and it’s a worrying sign for the vulnerable group of workers”. Business Insider.

Heather Long (28 June 2019) “America’s severe trucker shortage could undermine the prosperous economy”. Washington Post.

Wolf Richter (16 January 2019) “What truck drivers say about driver shortage & pay increases”. Originally published at Wolf Street.

Shona Ghosh (9 October 2018) “Uber drivers are staging their first multi-city strike, and it’s a sign their anger over exploitation is getting harder to ignore.” Business Insider.

Steve Hawk (5 March 2018) “What an economist Iearned by driving for Uber”. Quartz.

Carolyn Said (11 February 2019) “Revolt of the gig workers: How delivery rage reached a tipping point”. San Francisco Chronicle.

Sonali Kohli, Howard Blume (7 January 2019) “Highly paid substitutes, lessons in large spaces – How L.A. Unified is preparing for a teachers strike”. Los Angeles Times.

Barbara Madeloni (5 October 2018) “The teachers strike wave in Washington”. Jacobin.

Eleanor J. Bader (23 November 2018) “Bake sales can’t fix this: Corporate tax cuts leave public schools desperate”. Truthout.

Dwyer Gunn (6 October 2018) “America’s teacher shortage”. The Week.

Will Bunch (17 January 2019) “L.A. teacher strike may be cutting edge of a revolution against what’s rotten in America”. The Inquirer Daily News.

Jeff Bryant (18 January 2019) “How teacher strikes are exposing the corrupt charter school agenda”.

Sarah Jaffe (18 January 2019) “The radical organizing that paved the way for LA’s teachers’ strike”. The Nation.

Jersey Jazzman (18 February 2019) “The true history of New Jersey teachers’ (and other public workers’) sacrifices on pensions and benefits”.

Jeff Bryant (1 March 2019) “The rapid victory of the West Virginia teacher strike shows what happens when progressives join the fight against school privatization”.

Paul Farhi (19 December 2018) “Unions get a welcome reception in digital newsrooms”. Washington Post.

Sean Collins (2 January 2019) “Green, union jobs: Organizing at Buffalo’s Tesla factory”. Strikewave.

Aurélien Delpirou (12 December 2018) “Breaking Out of the Margins”. Jacobin.

Jen Schradie (17 December 2018) “Debate: The Gilets Jaunes movement is not a Facebook revolution”. Originally published at The Conversation.

Alexandra Schwartz (14 December 2018) “To exist in the eyes of others: An interview with the Novelist Édouard Louis on the Gilets Jaunes Movement”. The New Yorker.

Alexis Spire (December 2018) “The anger of the gilets jaunes”. Le Monde Diplomatique.

Thomas Piketty (11 December 2018) “Yellow vests and tax justice”. Le Monde.

Annabelle Timsit (14 January 2019) “In an open letter, Emmanuel Macron asks every French citizen to answer 20 big questions.” Quartz.

Ellen Sheng (22 October 2018) “Silicon Valley’s dirty secret: Using a shadow workforce of contract employees to drive profits”. CNBC.

Bryce Covert (29 November 2018) “The dangerous, low-paid world of nail salons”. Truthout.

Danielle Paquette (12 December 2018) “Workers are ghosting their employers like bad dates”. Washington Post.

The future of work

ILO Global Commission on the Future of Work (22 January 2019) “Work for a brighter future”.–en/index.htm

Among the issues considered are new forms of work, the institutional ramifications of the changing nature of work, lifelong learning, greater inclusivity and gender equality, the measurement of work and human well-being, and the role of universal social protection in a stable and just future of work.

World Economic Forum (2018) “The future of jobs report 2018”.

Maurizio Bussolo, María E. Dávalos, Vito Peragine, Ramya Sundaram (2018) “Toward a new social contract: taking on distributional tensions in Europe and Central Asia”. World Bank Group.

This report provides detailed analysis of the trends and consequences of the changing work environment and the rising tensions between workers, between generations, and between regions. It suggests a long-term productive and stable solution requires (1) understanding better how inequality is evolving, and whether the growth process is or is not inclusive, and (2) rethinking the social contract – the shared principles used to regulate markets, define responsibilities and benefits, and redistribute incomes. The report advocates three policy principles; namely (1) moving toward equal protection of all workers while promoting labor markets’ flexibility; (2) seeking universality in the provision of social assistance, social insurance, and basic quality services; and (3) supporting progressivity in a broad tax base that complements labor income taxation with the taxation of capital.

Akhil Kumar (26 January 2019) “Future of work in India: What is the view of the Indian industry?”. The Wire.

Seth G. Benzell, Erik Brynjolfsson (February 2019) “Digital abundance and scarce genius: Implications for wages, interest rates, and growth”. NBER.

The ability to reproduce digital versions of labor and capital cheaply increases supply and reduces the marginal cost of labor and capital. What becomes scarce is a third factor, genius that cannot be duplicated. We show that when increasingly digitized capital and labor are sufficiently complementary to inelastically supplied genius, innovation augmenting either of the first two factors can decrease wages and interest rates in the short and long run. Growth is increasingly constrained by the scarce input, not labor or capital. We discuss microfoundations for genius, with a focus on the increasing importance of superstar labor. We also consider consequences for government policy and scale sustainability.

David Bloom, Mathew McKenna, Klaus Prettner (17 December 2018) “Demography, unemployment, and automation: Challenges in creating (decent) jobs until 2030”.

This column estimates about three quarters of a billion jobs needs to be created in 2010–2030. It also discusses how automation will add to the number of jobs required.

Craig A. Giffi, Paul Wellener, Ben Dollar, Heather Ashton Manolian, Luke Monck, Chad Moutray (14 November 2018) “The jobs are here, but where are the people?”. Key findings from the 2018 Deloitte and The Manufacturing Institute skills gap and future of work study. Deloitte Insights.

Martha Gimbel, Tara Sinclair (20 September 2018) “The US labor market is changing fast – but job seekers are keeping up.” The Indeed Hiring Lab.

Jonathan Haskel, Stian Westlake (31 May 2018) “Productivity and secular stagnation in the intangible economy”.

The recent rise of the intangible economy played an important role in causing secular stagnation and a slowdown in TFP growth. An assessment of measurement trends and the properties of intangible investment suggests TFP growth will remain low until governments design institutions an intangible economy needs, and until its commercial, legal, and ethical norms are worked out.

Erik Brynjolfsson, Daniel Rock, Chad Syverson (October 2018) “The productivity J-curve: How intangibles complement general purpose technologies”. NBER.

Our model generates a Productivity J-Curve to explain the productivity slowdowns often accompanying the advent of General Purpose Technology (GPT) such as AI as well as the follow-on increase in productivity later. We conduct an analysis of the roles of intangibles tied to R&D, software, and computer hardware, finding substantial and ongoing effects of software in particular and hardware to a lesser extent.

Wen Chen, Bart Los, Marcel Timmer (10 December 2018) “The rise of intangible income: A global value chain perspective”.

This column argues a global value chain perspective on factor incomes provides new insights. It documents a rapid increase in the share of ‘factorless’ income in global value chains in the 2000s and argues this period is an exceptional period during which multinational firms benefitted from reduced labour costs through offshoring, while capitalising on firm-specific intangibles at little marginal cost.

Meghana Ayyagari, Asli Demirgüç-Kunt, Vojislav Maksimovic (8 October 2018) “Superstar firms, market power, and corporate inequality: The role of intangible capital”.

The emergence of ‘superstar’ firms has led to concern some sectors are too concentrated. The column argues the difference in returns can be accounted for by better measurement of intangible capital. These firms may not be exercising market power in ways that harm consumers in the short run, but policymakers should ensure markets remain contestable.

Asher Schechter (4 March 2019) “The biggest puzzle in economics: Why the superstar economy lacks any actual superstars”. Pro-market.

World Bank (2019) “World Development Report 2019: The changing nature of work”.

Tito Boeri, Pietro Garibaldi (April 2019) “A tale of comprehensive labor market reforms: Evidence from the Italian Jobs Act”. CEP.

The Italian Jobs Act introduced a subsidy for new hirings as well as a new open ended labor contract based on graded security, with severance payments increasing with tenure, while phasing out the compulsory reinstatement of workers in the case of unfair dismissals. We find evidence of a substantial increase in open ended hirings, and in the transformation of fixed-term into open ended contracts, in the aftermath of the Jobs Act. The effects of the Jobs Act on firings conversely are much smaller, and are concentrated on large firms, while small firms react more intensively – creating new open-ended contracts – to the hiring subsidy.

Diana Farrell, Fiona Greig, Amar Hamoudi (September 2018) “The online platform economy in 2018: Drivers, workers, sellers, and lessors”. JPMorgan Chase Institute.

Edelman Intelligence (September 2017) “Freelancing in America 2017”. Commissioned by Upwork and Freelancers Union.

William Kerr, Christopher Stanton (27 August 2018) “Stickiness on digital labour platforms and ethnic networks”.

This column provides evidence on flows and substitution across countries on the new digital platforms. Contract placements via Upwork are frequently cross-border and North-South in nature. The findings also suggest employers leave the platform in response to wage bid increases rather than substituting away from their target search location. Diaspora networks matter for how contracts are placed at the global level.

Sharon Belenzon, Victor Manuel Bennett, Andrea Patacconi (March 2019) “Flexible production and entry: Institutional, technological, and organizational determinants”. NBER.

The ability of firms to replace capital with workers can help new firms overcome uncertainty and increase entrepreneurial entry. We develop a simple real options model where permissive labor regulations allow firms to take advantage of capital-labor substitutability by replacing rigid capital with flexible labor. The model highlights institutional, technological, and organizational preconditions to using this flexibility.

Lawrence F. Katz, Alan B. Krueger (January 2019) “Understanding trends in alternative work arrangements in the United States”. NBER.

This paper tries to reconcile trends in alternative work arrangements using data from the Contingent Worker Survey, the RAND-Princeton Contingent Work Survey (CWS), and administrative tax data. We conclude there likely has been a modest increase in the share of the U.S. workforce in alternative work arrangements during the 2000s. Evidence from Amazon Mechanical Turk suggests the basic monthly CPS question on multiple job holding misses many instances of multiple job holding.

Eurofound (2018) “Employment and working conditions of selected types of platform work”. Publications Office of the European Union.

This report explores the working and employment conditions of the three most common types of platform work in Europe – assessing the physical and social environment, autonomy, employment status and access to social protection, and earnings and taxation based on interviews with platform workers. A comparative analysis of the regulatory frameworks in 18 EU Member States looks into workers’ employment status, the formal relationships between clients, workers and platforms, and the organisation and representation of workers and platforms.

Alana Semuels (31 August 2018) “The online gig economy’s Race to the Bottom. When the whole world is fighting for the same jobs, what happens to workers?” The Atlantic.

Annie Lowrey (14 January 2019) “The truth about the gig economy”. The Atlantic.

Timothy Taylor (29 January 2019) “Do we even know if the gig economy is growing?” Conversable Economist.

David Bell, David Blanchflower (24 September 2018) “Underemployment in the US and Europe”.

The most widely available measure of underemployment is the share of involuntary part-time workers in total employment. This column argues that this does not fully capture the extent of worker dissatisfaction with currently contracted hours. An underemployment index measuring how many extra or fewer hours individuals would like to work suggests that the US and the UK are a long way from full employment, and that policymakers should not be focused on the unemployment rate in the years after a recession, but rather on the underemployment rate. 

Luc Laeven, Peter McAdam, Alexander Popov (10 December 2018) “Labour market flexibility during financial crises: Firm-level evidence from Spain”.

Using data from Spain during the 2008–09 credit crunch, the results show credit-constrained firms grow faster if they are subject to less strict firing and hiring restrictions, as long as they are technologically able to substitute labour for capital. The findings provide an argument in favour of more flexible labour laws.

Holger Görg (November 2018) “Employment to output elasticities & reforms towards flexicurity: Evidence from OECD countries”. Institute of Labor Economics (IZA).

We revisit the influence of labour market policies on employment’s responsiveness to output fluctuations (employment-output elasticity) on OECD countries. We find that the effects of any single policy change are shaped by the broader existing policy-mix within which it takes place. Finally, we evaluate the effect of a move to ‘flexicurity’ on the employment-output elasticity in each country.

Dani Rodrik (7 February 2019) “The good jobs challenge”. Project Syndicate.

Every economy in the world today is divided between an advanced segment, typically globally integrated, employing a minority of the labor force, and a low-productivity segment that absorbs the bulk of the workforce, often at low wages and under poor conditions. How should policymakers address this dualism?

Robert J. Shiller (February 2019) “Narratives about technology-induced job degradations then and now”. NBER.

Concerns that technological progress degrades job opportunities relates to its impact on economic inequality and the perceived decline in job quality in terms of its effects on monotony vs creativity of work, individual sense of identity, power to act independently, and meaning of life. Public policy should take account these concerns.

Gabriele Ciminelli, Romain A Duval, Davide Furceri (16 August 2018) “Employment protection deregulation and labor shares in advanced economies”. IMF.

This paper assesses the impact of job protection deregulation in 26 advanced economies during 1970-2015; on the basis job protection deregulation have larger negative effects in industries characterized by (i) a higher “natural” propensity to adjust the workforce, and (ii) a lower elasticity of substitution between capital and labor. We find a statistically significant, economically large and robust negative effect of deregulation on the labor share. Rough calculations suggest job protection deregulation may have contributed about 15 percent to the average labor share decline. Together with existing evidence regarding the macroeconomic gains from job protection and other labor market reforms, our results point to the need for policymakers to address efficiency-equity trade-offs when designing such reforms.

OECD (May 2018) “The future of social protection: What works for non-standard workers?”. Policy Brief on the Future of Work.

Tom Krebs, Martin Scheffel (1 February 2019) “Optimal social insurance and rising labor market risk”. Opportunity and Inclusive Growth Institute.

We develop a macroeconomic model with risk-free physical capital, risky human capital (labor market risk) and unobservable effort choice affecting the distribution of human capital shocks (moral hazard). We use the tractability result to show that an increase in labor market (human capital) risk increases social welfare if the government adjusts the tax-and-transfer system optimally. We provide a quantitative analysis of the secular rise in job displacement risk in the US and find that the welfare cost of not adjusting the social insurance system optimally can be substantial.

Seth D. Harris, Alan B. Krueger (December 2015) “A proposal for modernizing labor laws for twenty-first-century work: The independent worker”. Hamilton Project.

Our proposal seeks to structure benefits to make independent worker status neutral as well as to enhance the efficiency of the operation of the labor market. By extending many of the legal benefits and protections found in employment relationships to independent workers, our proposal would protect and extend the social compact between workers and employers, and reduce the legal uncertainty and legal costs that beset many independent worker relationships.

Chad Shearer, Isha Shah (18 December 2018) “Opportunity industries: Exploring the industries that concentrate good and promising jobs in metropolitan America”. Brookings.

John V. Duca (16 November 2018) “Inflation and the gig economy: Have the rise of online retailing and self-employment disrupted the Phillips Curve?” Working Paper 1814. Federal Reserve Bank of Dallas

By omitting important structural changes, conventional Phillips Curve models have failed to track how online retailing has flattened the Phillips Curve and how the gig economy has lowered the natural rate of unemployment. One notable difference between the price-price and wage-price results is that the combined effects of online shopping and self-employment are more notable on wage inflation than on price inflation. This could plausibly reflect that improvements in information technology may have undermined the pricing power of workers in labor markets to a greater degree than they have affected the pricing power of producers in goods markets.

Andrew Kortina, Namrata Patel (13 October 2018) “Kinky labor supply and the attention tax”.

Zoë B. Cullen, Ricardo Perez-Truglia (October 2018) “The salary taboo: Privacy norms and the diffusion of information”. NBER.

The diffusion of salary information has important implications for labor markets, such as for wage discrimination policies and collective bargaining. We conduct a field experiment with 752 employees at a multibillion-dollar corporation and provide evidence of significant frictions in how employees search for and share salary information are due to privacy norms.

Sanjukta Paul (2 August 2016) “Uber as for-profit hiring hall: A price-fixing paradox and its implications”. Berkeley Journal of Employment and Labor Law.

Uber has thus far been permitted to engage in price coordination between independent contractors for its own economic benefit. This paper furnishes an argument in favor of collective bargaining rights for this group of workers that relies neither upon employee status, nor upon independent reasons in favor of collective bargaining, but rather upon a simple principle of consistency in applying existing price-fixing norms.

Jonathan V. Hall, John J. Horton, Daniel T. Knoepfle (9 August 2018) “Pricing efficiently in designed markets: Evidence from ride-sharing”.

Data from Uber show that price increases initially increase the money per trip for drivers but it also increases the hours worked; resulting in drivers spending less time with paying customers, eventually bringing the hourly earnings rate back close to its previous level. The higher fare/lower productivity equilibrium is generally inefficient.

Meng Liu, Erik Brynjolfsson, Jason Dowlatabadi (12 October 2018) “How digital platforms reduce moral hazard: Uber vs Taxis”.

The column compares matched pairs of taxi and Uber journeys in New York City. Uber drivers were less likely to unnecessary detours, suggesting Uber’s innovations in fare structure and digital feedback reduced moral hazard.

Yves Smith (25 September 2018) “Widely-reported study on Uber, Lyft driver economics misses fundamental deterioration”. Naked Capitalism.

Yves Smith (3 October 2018) “New study: Median Uber driver earnings $9.73/hour after conservative assumption for costs”. Naked Capitalism.

Luigi Zingales (4 October 2018) “Does Uber kill? The real cost of ride-sharing”. Pro-market.

Thor Berger, Carl Benedikt Frey, Guy Levin, Santosh Rao Danda (October 2018) “Uber Happy? Work and wellbeing in the gig economy”. Working paper presented at the 68th Panel Meeting of Economic Policy.

Based on data from Uber and a survey of London drivers, we find the vast majority of Uber’s drivers are male immigrants primarily drawn from the bottom half of the London income distribution. Most transitioned out of permanent part- or full-time jobs and about half of drivers’ report that their incomes increased after partnering with Uber. While Uber drivers remain at the lower end of the London income distribution, they report higher levels of life satisfaction but higher anxiety levels. Our findings highlight the importance of non-monetary factors in shaping the welfare of gig workers.

Alex Rosenblat, Luke Stark (30 July 2016) “Algorithmic labor and information asymmetries: A case study of Uber’s drivers”. International Journal of Communication.

Through an empirical study of Uber driver experiences, we found Uber does leverage significant indirect control over how drivers do their jobs. First, the information and power asymmetries produced by its app are fundamental to its ability to structure control over its workers. Second, the rhetorical invocations of digital technology and algorithms are used to structure asymmetric corporate relationships to labor, which favor the former. Greater attention is needed on the role of platform disintermediation in shaping power relations and communications between employers and workers.

Maria Grazia Attinasi, Francesco Berardini, Alessandra Anna Palazzo (January 2019) “Do public wages in the euro area explain private wage developments? An empirical investigation”. European Central Bank.

This paper investigates the relationship between public and private wages in the five largest euro area countries during 1997-2017. The analysis shows there is a positive and significant response of private wages to a public wage shock. This effect is temporary and differs across countries. The response of private wages is asymmetric: a positive and statistically significant response in the case of a positive shock to public wages, while no statistically significant effects were found for a cut in public wages.

Izabela Karpowicz (19 March 2019) “Self-employment and support for the Dutch pension reform”. IMF.

The Netherlands’ pension system is characterized by high participation rates, adequate retirement income, strong capitalization and sustainability. Pressure points are arising due to population aging and untransparent intergenerational transfers. Moreover, the Dutch pension system needs to adapt to the changing labor market landscape with an increasing share of workers in self-employment not covered by any pension arrangement. The government has proposed replacing collective defined-benefits schemes with personal accounts, and abolishing uniform premia and constant accrual rates. The micro-data analysis shows that allowing greater risk-taking and freedom of choice in managing pension savings could crowd self-employed into pension schemes.

Kimberly Amadeo (19 March 2019) “Do tax cuts create jobs? If so, how?”