Background paper to the keynote address of Danny Blanchflower to the EBES 37 & GLO Berlin conference. More information: LINK.
Danny Blanchflower
Author Abstract: Unemployment is notoriously difficult to predict. In previous studies, once country fixed effects are added to panel estimates, few variables predict changes in unemployment rates. Using panel data for 29 European countries – Austria; Belgium; Bulgaria; Croatia; Cyprus; Czechia; Denmark; Estonia; Finland; France; Germany; Greece; Hungary; Ireland; Italy; Latvia; Lithuania; Luxembourg; Malta; Netherlands; Poland; Portugal; Romania; Slovakia; Slovenia; Spain; Sweden; Turkey and the UK – over 439 months between January 1985 and July 2021 in an unbalanced country*month panel of just over 10000 observations, we predict changes in the unemployment rate 12 months in advance based on individuals’ fears of unemployment, their perceptions of the economic situation and their own household financial situation. Fear of unemployment predicts subsequent changes in unemployment 12 months later in the presence of country fixed effects and lagged unemployment. Individuals’ perceptions of the economic situation in the country and their own household finances also predict unemployment 12 months later. Business sentiment (industry fear of unemployment) is also predictive of unemployment 12 months later. The findings underscore the importance of the “economics of walking about”. The implication is that these social survey data are informative in predicting economic downturns and should be used more extensively in forecasting. We also generate a 29 country-level annual panel on life satisfaction from 1985-2020 from the World Database of Happiness and show that the consumer level fear of unemployment variable lowers wellbeing over and above the negative impact of the unemployment rate itself. Qualitative survey metrics were able to predict the Great Recession and the economic slowdown in Europe just prior to the COVID pandemic.
The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.
TheGLO Virtual Seminar is a monthly internal GLO research event chaired by GLO Director Matloob Piracha and hosted by the GLO partner institution University of Kent. The results are available on the GLO website and the GLO News section, where also the video of the presentation is posted. All GLO related videos are also available in the GLO YouTube channel. (To subscribe go there.)
The last seminar was given on July 8, 2021, London/UKat 1-2 pm, by Olga Popova, Institute for East and Southeast European Studies (IOS) & GLO on Does weather sharpen income inequality in Russia? See below a report, the presentation slides and the full video of the seminar.
Report
Does weather sharpen income inequality in Russia?
GLO Virtual Seminar on July 8, 2021
Olga Popova, Institute for East and Southeast European Studies (IOS) & GLO
ABSTRACT Using subnational panel data, this paper analyzes how hot and cold extreme temperatures and precipitation affect economic activity and income distribution in Russia. We account for the intensity of exposure to extreme temperatures by analyzing the impacts of both single and consecutive days with extreme temperature, i.e., heat waves and cold spells, and examine several labor market channels behind those effects. We find that consecutive extremely hot days decrease regional GDP per capita but do not affect income inequality. Poor regions are affected by extreme temperatures relatively more than rich regions. These effects occur because of reallocation of labor from employment to unemployment, an increase in prices in poor regions, and to some extent because of changes in the industrial employment structure, while relative wages are not affected. Extremely cold days, both single and consecutive, as well as extreme precipitation have a limited impact on economic activity and income distribution.
Research Questions and Contribution
Examine the distributional impacts of extreme temperature and precipitation shocks, using the regional panel data from Russia
Account for the intensity of extreme temperatures exposure by simultaneously examining the impacts of both single and consecutive days with extreme temperature
Identify and test the labor market channels behind the inequality‐temperature relationship
Study if the impacts are heterogeneous • Poor vs. rich regions • Hot vs. cold regions
Correlation between days above 25°C and ln(GDP) in Russia
A new GLO Discussion Paper examines an Indian conditional cash transfer program to find an improved sex ratio at birth and better post-birth outcomes like immunization and education.
Author Abstract: Worldwide, 1.6 million girls are “missing” at birth every year. One policy tool to improve the sex ratio is a conditional cash transfer that pays parents to invest in daughters, but existing evidence on their effectiveness is sparse. Using a difference-in-differences framework, we evaluate the Dhanlakshmi scheme, an Indian CCT program that strongly encouraged girl births without restricting fertility. Dhanlakshmi improved the sex ratio at birth, with only a small fertility increase. The girl-birth effect was concentrated among the first two parities and partially persisted after the program was discontinued. Post-birth outcomes like immunization and education also improved.
The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.
SSCIIMPACT FACTOR2.813 (2020) from 1.840 (2019) & 1.253 (2018) SSCI 5-Year Impact Factor3.318 (2020) from 2.353 (2019) & 2.072 (2018) SSCI Journal Citation Indicator (JCI) = 1.20 (2020).JoPE has 20% more citation impact than the average in its category. Rank by JCI in 2020: 98/549, Q1 Economics; 10/49, Q1 in Demography CiteScore (Scopus): 3.9 (2020) SJR (Scimago Journal Rank): 1.89 (2020) IDEAS/RePEc ranking (July 2021) was 77/2,698 journals (based on the Simple Impact Factor 17.327, for Journals and all years)
The Journal of Population of Economicsis an international quarterly that publishes original theoretical and applied research in all areas of population economics, household economics, and human resources. This report contains information about the Journal and its editorial process in the past year and some earlier years.
Figure 1: Number of Submissions
The number of submissions has substantially increased over recent years (Figure 1). Between 2011 and 2013, the Journal received about 400 submissions per year; by 2016 the number of submissions neared 500, and in 2020, 871 manuscripts were received. This marks an annual increase of submissions of 41%. Over the decade 2010-2020, the manuscript inflow rose from 337 to a level 2.6 times higher. The additional workload was managed through an efficient desk rejection policy for initial screening.
Figure 2: Origin of Submissions
In line with past years, the largest single share of submissions made in 2020 were from corresponding authors based in Europe (Figure 2). Nearly 40% of all submissions originated from Europe, and over one-third (34%) of submissions came from authors based in Asia and the Middle East. Under one-fifth (17%) of submissions came from authors based in North America. The remaining submissions came from contributors from Africa (6%), Oceania (Australia and New Zealand; 4%), and South and Central America (4%).
Figure 3: Visits by World Region 2019
Figure 3 contains the internet visits to the Journal on the Springer website from the world regions. With over a third of visits coming from North America and 29% from Europe, followed by the Asia-pacific region (22%), the Journal is globally accessed and read.
Figure 4: Days to First Decision
Figure 4 shows that the average number of days between submission and first decision has generally declined over time. Despite a slight uptick in the turnaround time for first decisions between 2015 and 2016, which may be partially attributed to the increased volume of submissions, there was a substantial reduction in turnaround time in following years. In 2020, the average time for first decisions was 24 days. The Journal is committed to keep the time between submission and decisions low, including eventual publication. Since 2013 the Journal has executed a desk rejection policy to provide authors with an early signal for better targeting of their work. The large number of submissions combined with an annual quota of 40 manuscripts keeps the acceptance rates of the Journal very low.
Table 1 shows three acceptance rate measures: 1) the number of manuscripts accepted in a given year as a share of all final decisions made in that year; 2) the number of published articles in a given year as a share of all submissions in that year; and; 3) the number of articles published in a given year divided by the number of the previous year’s submissions.
The number of accepted papers (submitted at any point in time) in a given year as a share of all decisions made in that year has shifted over time. The acceptance rate has declined from 7% in 2018 to 4.9% in 2019, slightly increasing in 2020 to 5.4%. If acceptance rate is measured as the number of published manuscripts as a share of total submissions received in that year, the acceptance rate was slightly higher, at 4.6% in 2020 (at 40 manuscripts from among 871 submissions), falling from 7.1% in 2018 and 6.5% in 2019. Measuring the acceptance rate as the number of publications as a share of the number of submissions received in the previous year (2019) would yield a 2020 rate of 6.5%, which is lower than the previous years (7.6% in 2018 and 7.1% in 2019).
Table 1: Acceptance Rates
Index Year
2018
2019
2020
No. accepted / Total No. decisions
7.0%
4.9%
5.4%
No. articles publ. / No. submissions
7.1%
6.5%
4.6%
No. articles publ. / No. subm. prev. year
7.6%
7.1%
6.5%
Table 2 reports the status of papers submitted in the given year for years 2018 – 2020. The Journal’s Impact Factor has increased substantially over time (Figure 5). In 2020 Impact Factor was 2.813, and the 5-year Impact Factor was 3.318. The Journal ranked 104/377 in economics and 10/29 in demography in 2020. As of July 2021, the Journal’s IDEAS/RePEc ranking was 77/2,698 (based on the Simple Impact Factor 17.327, for Journals and all years).
Table 2: Status of Papers Submitted in Particular Year
Outcome/Year
2018
2019
2020
Accept
39
35
47
Revise
68
125
81
Reject
522
551
737
The Journal is ranked in: Social Science Citation Index, Journal Citation Reports/Social Sciences, SCOPUS, EconLit, Google Scholar, EBSCO Discovery Service, ProQuest, CAB International, ABS Academic Journal Quality Guide, Academic OneFile, Academic Search, Bibliography of Asian Studies, CAB Abstracts, CSA Environmental Sciences, Current Contents/Social & Behavioral Sciences, ECONIS, ERIH PLUS, Gale, Global Health, International Bibliography of the Social Sciences (IBSS), JSTOR, OCLC, Research Papers in Economics (RePEc), Review of Population Reviews, SCImago, and Summon by ProQuest.
Klaus F. Zimmermann, Editor-in-Chief Journal of Population Economics
The Institute for Economic and Social Research (IESR) at Jinan University and the Global Labor Organization (GLO) are jointly organizing the Fourth IESR-GLO Virtual Conference. The conference this year is held from June 24 (Thursday) to June 26 (Saturday), 2021 through Zoom. The theme is Social Safety Net and Welfare Programs. Robert Moffitt and Timothy Smeeding are the keynote speakers. (Feng of IESR right & Zimmermann of GLO left)
Speakers on June 24 from the left: Michael Christl, Jinyuan Yang, Sen Xue Shuaizhang Feng, Robert Moffitt, Klaus F. Zimmermann Feng Chen, Laura V. Zimmermann, Xi Chen
Day 2; June 25:
Program
8.00-11.05 pm Beijing Time / 8:00-11.05 am New York / 1:00-4:05 pm London JUNE 24 (Thursday). Chair:Sen Xue(IESR, Jinan University & GLO)
8.00-8.05 pm Beijing Time / 8:00-8.05 am New York / 1:00-1:05 pm London Opening Remarks by Shuaizhang Feng (IESR, Jinan University & GLO) & Klaus F. Zimmermann (UNU-MERIT, Maastricht University & GLO)
8.05-9.05 pm Beijing Time / 8:05-9.05 am New York / 1:05-2:05 pm London Keynote Lecture:Take-up in Social Assistance Programs: Theory and Evidence Keynote Speaker: Robert Moffitt (Johns Hopkins University)
9.05-9.35 pm Beijing Time / 9:05-9.35 am New York / 2:05-2:35 pm London The Power of Lakshmi: Monetary Incentives for Raising a Girl Nabaneeta Biswas (Marshall University), Christopher Cornwell (University of Georgia) &Laura V. Zimmermann(University of Georgia & GLO). Based on GLO Discussion Paper No. 888. Download PDF.
9.35-10.05 pm Beijing Time / 9:35-10.05 am New York / 2:35-3:05 pm London Grandfathers and Grandsons: Social Security Expansion and Child Health in China Jinyuan Yang (Virginia Tech)& Xi Chen (Yale University & GLO)
10.05-10.35 pm Beijing Time / 10:05-10.35 am New York / 3:05-3:35 pm London Trapped in inactivity? Social Assistance and Labour Supply in Austria Michael Christl (European Commission & GLO) & Silvia De Poli (European Commission)
10.35-11.05 pm Beijing Time / 10:35-11.05 am New York / 3:35-4:05 pm London Does Paid Family Leave Save Infant Lives? Evidence from California Feng Chen(Tulane University & GLO)
8.00-11.00 pm Beijing Time / 8:00-11.00 am New York / 1:00-4:00 pm London June 25 (Friday). Policy Forum on Social Assistance Systems Chair: Klaus F. Zimmermann (UNU-MERIT, Maastricht University & GLO)
8.00-8.45 pm Beijing Time / 8:00-8.45 am New York / 1:00-1:45 pm London Japan. Masayoshi Hayashi (University of Tokyo) Public Assistance in Japan: Current State and Challenges
8.45-9.30 pm Beijing Time / 8:45-9.30 am New York / 1:45-2:30 pm London South Korea. Inhoe Ku(Seoul National University) Social Assistance in South Korea: Policy Developments, Impacts and Implications for Future Reform
9.30-10.15 pm Beijing Time / 9:30-10.15 am New York / 2:30-3:15 pm London Germany. Alexander Spermann (FOM/Cologne, University of Freiburg and GLO) Basic Income in Germany 1991-2021: Challenges After Reunification, Hartz Reforms and the Current Reform Debate
10.15-11.00 pm Beijing Time / 10.15-11.00 am New York / 3:15-4:00 pm London Sweden. Björn Gustafsson (University of Gothenburg and GLO) Social Assistance in Sweden – Provision, Recipients and Challenges
8.00-11.00 pm Beijing Time / 8:00-11.00 am New York / 1:00-4:00 pm London JUNE 26 (Saturday). Chair: Shuaizhang Feng (IESR, Jinan University & GLO)
8.00-9.00 pm Beijing Time / 8:00-9.00 am New York / 1:00-2:00 pm London Keynote Lecture:Poverty and Income Support Around the World: China, India and Asia in Comparative Perspective Keynote Speaker: Timothy Smeeding (University of Wisconsin–Madison)
9.00-9.30 pm Beijing Time / 9:00-9.30 am New York / 2:00-2:30 pm London The Health of Disability Insurance Enrollees: An International Comparison Enrica Croda (Ca’Foscari University of Venice & GLO),Jonathan Skinner (Dartmouth College) & Laura Yasaitis (Dartmouth College)
9.30-10.00 pm Beijing Time / 9:30-10.00 am New York / 2:30-3:00 pm London The Unintended Effect of Medicaid Aging Waivers on Informal Caregiving Xianhua (Emma) Zai(Ohio State University & GLO)
10.00-10.30 pm Beijing Time / 10:00-10.30 am New York / 3:00-3:30 pm London Housing Vouchers, Labor Supply and Household Formation: A Structural Approach Ning Zhang (University of Pittsburgh)
10.30-11.00 pm Beijing Time / 10:30-11.00 am New York / 3:30-4:00 pm London The Structure and Incentives of a COVID related Emergency Wage Subsidy Jules Linden (National University Ireland Galway & Luxembourg Institute of Socio-Economic Reesarch), Cathal O’Donoghue (National University Ireland Galway), Denisa M. Sologon (Luxembourg Institute of Socio-Economic Reesarch)
Keynote speakers
Robert Moffitt on June 24; 8.00 pm Beijing Time
Robert A. Moffitt is the Krieger-Eisenhower Professor of Economics at Johns Hopkins University and holds a joint appointment at the Johns Hopkins Bloomberg School of Public Health. He obtained his Ph.D. degree from Brown University. His research interests are in the areas of labor economics and applied microeconometrics, with a special focus on the economics of issues relating to the low-income population in the U.S.. A large portion of his research has concerned the labor supply decisions of female heads of family and its response to the U.S. welfare system. He has published on the AFDC, Food Stamp, and Medicaid programs.
Moffitt has served as Chief Editor of the American Economic Review, Coeditor of the Review of Economics and Statistics, Chief Editor of the Journal of Human Resources, and as Chair of the National Academy of Sciences Panel to Evaluate Welfare Reform. He is currently editor of Tax Policy and the Economy.
Moffitt is also a Fellow of the Econometric Society, a Fellow of the Society of Labor Economists, a member of the National Academy of Sciences, a recipient of a MERIT Award from the National Institutes of Health, a recipient of a Guggenheim Fellowship, a Fellow of the American Academy of Arts and Sciences, and Past President of the Population Association of America.
Timothy Smeeding on June 26; 8.00 pm Beijing Time
Timothy Smeeding is Lee Rainwater Distinguished Professor of Public Affairs and Economics of the University of Wisconsin–Madison. He obtained his Ph.D. in Economics from the University of Wisconsin–Madison. He was director of the Institute for Research on Poverty from 2008–2014 and was the founding director of the Luxembourg Income Study from 1983-2006. He was named the John Kenneth Galbraith Fellow, American Academy of Political and Social Science in 2017.
Professor Smeeding’s recent work has been on social and economic mobility across generations, inequality of income, consumption and wealth, and poverty in national and cross-national contexts.
His recent publications include: SNAP Matters: How Food Stamps Affect Health and Well Being (Stanford University Press, 2015); Monitoring Social Mobility in the 21st Century (Annals of the American Academy of Political and Social Science, 2015); From Parents to Children: The Intergenerational Transmission of Advantage (Russell Sage Foundation, 2012); Persistence, Privilege and Parenting: The Comparative Study of Intergenerational Mobility (Russell Sage Foundation, 2011); The Handbook of Economic Inequality (Oxford University Press, 2009); Poor Kids in a Rich Country: America’s Children in Comparative Perspective (Russell Sage Foundation, 2003); and The American Welfare State: Laggard or Leader?, (Oxford University Press, 2010).
Policy Forum on Social Assistance Systems
June 25th: 8:pm-11pm Beijing Time/ 8:00am-11am New York / 1:00pm-4:00pm London Chair: Klaus F. Zimmermann (UNU-MERIT, Maastricht University & GLO)
8:00-8:45 pm: Japan. Masayoshi Hayashi (University of Tokyo) Public Assistance in Japan: Current State and Challenges
8:45-9:30 pm: Korea. Inhoe Ku(Seoul National University) Social Assistance in South Korea: Policy Developments, Impacts and Implications for Future Reform
9:30-10:15 pm: Germany. Alexander Spermann (FOM/Cologne, University of Freiburg and GLO) Basic Income in Germany 1991-2021: Challenges After Reunification, Hartz Reforms and the Current Reform Debate
10:15-11:00 pm: Sweden. Björn Gustafsson (University of Gothenburg and GLO) Social Assistance in Sweden – Provision, Recipients and Challenges
Masayoshi Hayashi (University of Tokyo) Professor of Economics at the University of Tokyo, and the President of the Japan Institute of Public Finance. He received a Ph.D. in Economics from Queen’s University at Kingston, Canada. His research interests include redistribution, taxation and fiscal federalism.
Inhoe Ku(Seoul National University) Professor at the Department of Social Welfare, Seoul National University. He is currently working as the President of the Korean Academy of Social Welfare. His research has been focusing on poverty, inequality and social policy.
Alexander Spermann (FOM/Cologne, University of Freiburg and GLO) Has started his research on social assistance more than thirty years ago. After finishing his dissertation and habilitation at the University of Freiburg, he held leading positions at international research institutes (ZEW, IZA) and is currently Professor of Economics at FOM Cologne and University of Freiburg. He has been a regular contributor to the media for decades.
Björn Gustafsson (University of Gothenburg and GLO) Professor Emeritus, University of Gothenburg, Sweden. He has published several papers on social assistance in Sweden. Since the 1990s he has also studied various aspects on income among Chinese households.
From the left: Masayoshi Hayashi, Inhoe Ku, Alexander Spermann, and Björn Gustafsson
May 17, 2021: “Human Resources Challenges” Virtual Workshop of the Academia Europaea (AE) Section “Economics, Business and Management Sciences”, all CET/Vienna. See also: Academia Europaea Website; CEU Website. The morning session presented work from the forthcoming Handbook of “Labor, Human Resources and Population Economics”published by Springer Nature reviewing and evaluating literature to human resources and technology as well as migation and aging. The afternoon session dealt with Covid-19 issues in the context of Mass Antigen Testing as well as female self-employment; presentations were based on GLO Discussion Papers referenced below forthcoming in the Journal of Population Economics. Both sessions were recorded and the videos are freely accessible below.
PROGRAM
Moderator of the event: Marton Leiszen (Central European University, Skills and Applied Learning Coordinator at the School of Public Policy)
Marton Leiszen
11.00 – 11.10 am Welcome Marton Leiszen (CEU), Martin Kahanec (MAE & CEU), Klaus F. Zimmermann (MAE, UNU-MERIT & GLO)
13.00 – 15.00 pm SESSION II:Covid-19 Research Both presentations were based on fresh and elaborated research papers, which are forthcoming in the Journal of Population Economics. The Journal has established a tradition of publishing some highly referenced research papers on Covid-19.
13.00 – 14.00 pm Martin Kahanec (MAE & CEU) with Lukas Laffers and Bernhard Schmidpeter The Impact of Mass Antigen Testing for COVID-19 on the Prevalence of the Disease GLO Discussion Paper No. 775, 2021, Journal of Population Economics.
Martin Kahanec
14.00 – 15.00 pm Alexander Kritikos (DIW Berlin & Potsdam University) with Daniel Graeber & Johannes Seebauer COVID-19: A Crisis of the Female Self-employed GLO Discussion Paper No. 788, 2021, Journal of Population Economics.
The Handbook in “Labor, Human Resources and Population Economics” provides an integrated picture of knowledge about the economic and social behaviors and interactions of human beings on markets, in households, in companies and in societies.A fast evolving project by the GLO with a core basis in labor economics, human resources, demography and econometrics, it will provide a large and complete summary and evaluation of the scientific state of the art. Chapters are developed under the guidance of an engaged team of editors led by the GLO President administered in 30 sections.
to find out how to contribute to this exciting venture with an own chapter.
The Section “Technological Changes and the Labor Market” is directed by Marco Vivarelli, who is also the GLO Cluster Lead of the “Technological Change” area.The Section is just completing its set of 20 published papers now available for use, review and debate.List of the articles and links to access them are below.
The Handbook of Labor, Human Resources and Population Economics Editor: Klaus F. Zimmermann
Section – Technological Changes and the Labor Market Marco Vivarelli, Section Editor Università Cattolica del Sacro Cuore Department of Economic Policy, Milan, Italy
Marco Vivarelli
Note: Find abstract links of the articles below the chapter titles.
Digitization and the Future of Work: Macroeconomic Consequences Melanie Arntz1,2, Terry Gregory3,1, Ulrich Zierahn5,1,4 1 Leibniz Centre for European Economic Research, 2University of Heidelberg, 3Institute of Labor Economics, IZA,4CESifo Research Network, 5Utrecht University
Innovation, Employment, and the Business Cycle Bernhard Dachs1, Martin Hud2, Bettina Peters2,3 1AIT Austrian Institute of Technology, 2Leibniz Centre for European Economic Research, 3University of Luxembourg
Why do employees participate in innovations? Skills and organisational design issues and the ongoing technological transformation, in production Nathalie Greenan, Silvia Napolitano Conservatoire National des Arts et Métiers
Quantity and Quality of Work in the Platform Economy Francesco Bogliacino1, Cristiano Codagnone2,3, Valeria Cirillo4, Dario Guarascio5 1Universidad Nacional de Colombia, 2Università degli Studi di Milano, 3Universitat Oberta de Catalunya, 4INAPP, National Institute for the Analysis of Public Policies, 5Università degli Studi di Roma
Integration in Global Value Chains and Employment Filippo Bontadini1, Rinaldo Evangelista2, Valentina Meliciani3, Maria Savona1 1University of Sussex, 2University of Camerino, 3University Luiss Guido Carli
GLO Policy Note No. 4 Theme 2: Inequalities and labor markets Theme 3: Future of Work
Working from home and income inequality in the time of COVID-19
A case study of Italy
by Luca Bonacini, Giovanni Gallo, Sergio Scicchitano
Luca Bonacini (University of Modena and Reggio Emilia, GLO)
Giovanni Gallo (Sapienza University of Rome, University of Modena and Reggio Emilia, GLO)
Sergio Scicchitano (National Institute for Public Policies Analysis – INAPP, GLO)
Luca Bonacini
Giovanni Gallo
Sergio Scicchitano
In a recent GLO Discussion Paper and just published in the Journal of Population Economics (Bonacini et al., 2021), we explore the potential consequences in labour income distribution of long-lasting increase in Working From Home (WFH) among Italian employees. Results show that an increase in WFH would be associated with an increase in the average labour income, but this potential benefit would not be equally distributed among employees. Specifically, an increase in WFH would favour male, older, high-educated, and high-paid employees. This “forced innovation” thus risks to exacerbate pre-existing inequalities in the labour market. As a consequence, this study suggests a series of policies aimed at alleviating inequality in the short run and, more importantly, that should play a rebalancing role, in the long run. ____________________
What we should know
To limit the number of deaths and hospitalisations due to the novel coronavirus, most governments decided to suspend many economic activities and restrict people’s freedom of mobility.
In this context, the opportunity to work from home (hereinafter called WFH) became of great importance, since it allows: employees to continue working and thus receiving wages, employers to keep producing services and revenues, and overall limits infection spread risk and pandemic recessive impacts.
Recent estimates for the US show that between February and May 2020 over one third of the labour force switched to WFH, resulting in about half of workers working remotely during the pandemic. Remote workers have quadrupled to 50% of US workforce (Brynjolfsson et al., 2020). Due to uncertainty about the duration of the health emergency and future contagion waves, the role of WFH in the labour market is further emphasized by the fact that it might become a new standard (rather than an unconventional) way of working in many economic sectors, possibly resulting in structural effects on the labour market worldwide (Baert et al., 2020).
Because of the WFH sudden prominence and growth, several studies recently investigated this phenomenon, especially with the objective of identifying the number of jobs that can be done remotely (Adams-Prassl et al., 2020; Dingel and Neiman, 2020; Mongey at al., 2020). However, the literature neglects potential effects of WFH on wage distribution and on income inequality in general.
What we do
This study is a first to show how a future increase in WFH would be related to changes in labour income levels and inequality.
We analyse to what extent an increase in the number of employees who have the opportunity to WFH (or at least an increase in the likelihood their professions can be performed from home) would influence the wage distribution, under the hypothesis that this WFH feasibility shift is long lasting.
We focus on Italy as an interesting case study because before the pandemic, the WFH practice was not widespread and it is the first Western country to adopt a lockdown of economic activities (on March 11). Barbieri et al. (2020) estimated that at least 3 million employees started to WFH because of lockdown measures, and a large number started even earlier due to the closure of schools and universities on March 5. Moreover, Italy was the European country with the lowest share of teleworkers before the crisis (Eurofound and ILO, 2017) and, because of the pandemic, it had to face a massive increase in WFH in a very short time without precise legislation and adequate policies.
Our analysis relies on a uniquely detailed dataset relying on the merge of two sample surveys: the Survey on Labour Participation and Unemployment (INAPP-PLUS) for the year 2018, which contains information on incomes, skills, education level, and employment conditions of approximately 45,000 working-age Italians and the Italian Survey of Professions (ICP) for the year 2013, which provides detailed information on the task-content of occupations. The analysis is conducted through an influence function regression method which allows to estimate the impact of marginal changes on an outcome variable distribution (see the paper for more details on the method).
What we find
Employees with high WFH feasibility levels are more often female, older, highly educated, and among those living in metropolitan areas.
Economic sectors being characterized by greater shares of employees with high WFH feasibility are: Finance and Insurance, Information and Communications, and Other Business Services (e.g., car renting, travel agencies, employment agencies).
Figure 1 shows the wage gap between employees with high and low WFH feasibility and the share of WFH feasibility along the income deciles. The figure clearly shows that the wage gap is increasing along the distribution and reaches highest values in the last two decile groups, as well as the same incidence of high WFH feasibility among employees.
Figure 1 – Incidence of high WFH feasibility and wage gap in favor of employees with high feasibility levels by decile of annual income
What we suggest
WFH risks to exacerbate pre-existing inequalities in the labour market. In this respect, while during the current emergency, policies aimed at alleviating inequality in the short run (e.g. income support measures for the most vulnerable), should be implemented, long-term interventions are even more necessary in order to prevent future rise of inequalities in the labour market. These long-term policies go in three interrelated directions:
The necessary massive reorganisation of work, particularly in the field of reengineering of production processes based on new digital technologies and on the possibility offered in terms of work from home requires new and more widespread skills.
We need to promote through adequate economic and cultural incentives, non-compulsory education for youth coming from poorer households. This would include training courses, which would play an important role in reducing future unequal distribution of benefits related to an increase of WFH opportunities, by increasing human capital and favouring its complementarities with technology.
Our study highlights that while most of the increase in WFH will concern women, the wage premium would be borne by male employees. In this perspective, a possible, non-exhaustive solution could be offered by policies aimed at improving work–family reconciliation, that continues to be shouldered more significantly by women. In particular, we stress the importance of an improving of public childcare and financial support to households with children.
Our study brings out several policy issues for tackling inequalities that will arise in the labour market because of the current pandemic in particular the more than probable increase in Working From Home. Our results are based on Italian data, but they may be useful to policymakers in other countries as well and, in general, where COVID-19 has forced governments and businesses to rethink production processes with a more intense and stable use of WFH. __________________
References
Adams-Prassl, A., Boneva, T., Golin M., Rauh C., (2020). Inequality in the Impact of the Coronavirus Shock: Evidence from Real Time Surveys. IZA Discussion Paper No. 13183.
Baert, S. Lippens, L. Moens, E. Sterkens, P. Weytjens, J. (2020), How do we think the COVID-19 crisis will affect our careers (if any remain)?, GLO Discussion Paper, No. 520, Global Labor Organization (GLO), Essen.
Barbieri, T., Basso, G., Scicchitano, S., (2020). Italian Workers at Risk during the COVID-19 Epidemic, GLO Discussion Paper, No. 513, Global Labor Organization (GLO), Essen.
Bonacini, L., Gallo, G. & Scicchitano, S. (2021). Working from home and income inequality: risks of a ‘new normal’ with COVID-19. J Popul Econ 34, 303–360.
Brynjolfsson, E., Horton, J. Ozimek, A. Rock, D. Sharma, G. and Yi Tu Ye, H. (2020). Covid-19 and remote work: An early look at U.S. data. NBER Working Paper 27344.
Dingel, J. I. and B. Neiman (2020). How many jobs can be done at home? Journal of Public Economics 189, 104235.
Eurofound and the International Labour Office (2017), Working anytime, anywhere: The effects on the world of work, Publications Office of the European Union, Luxembourg, and the International Labour Office, Geneva.
Mongey, S., Pilossoph, L., Weinberg. A., (2020). Which Workers Bear the Burden of Social Distancing Policies?. NBER Working Paper No. 27085.
Note: The opinions expressed here are those of the authors and not of the GLO, which has no institutional position. Featured image: Charles-Deluvio-on-Unsplash
TheGLO Virtual Seminar is a monthly internal GLO research event chaired by GLO Director Matloob Piracha and hosted by the GLO partner institution University of Kent. The results are available on the GLO website and the GLO News section, where also the video of the presentation is posted. All GLO related videos are also available in the GLO YouTube channel. (To subscribe go there.)
The last seminar was given on April 8, 2021, London/UKat 1-2 pm, by Nicole Simpson, Colgate University and GLO, on Single Mothers and Tax Credits: Insurance Without Disincentives? See below a report, a link to the presentation slides and the full video of the seminar.
Report
Single Mothers and Tax Credits: Insurance Without Disincentives?
This was an internal meeting of the AE section on special invitation only; a larger number of section members joined during the day as did a larger number of guests from CEU & GLO placed in various parts of the world.
Central European University (CEU), Vienna
November 23, 2020: “COVID-19” Virtual Workshop of the Academia Europaea (AE) Section “Economics, Business and Management Sciences”, all CET/Vienna.
PROGRAM
Ingy Kassem
Starting at 9.00 am; Informal get together, flexible entry….
Moderator of the event: Ingy Kassem (Central European University, Executive Assistant to the Head of the School of Public Policy)
NOTE: Ingy Kassem announced the program parts. The session chairs briefly announced the speakers. The speakers took 20 minutes for presentation. 10 minutes discussion. Luxurious breaks were used for intense communication. Participants brought their own food and drinks…. The meeting was not recorded.
9.30 am; Klaus F. Zimmermann (MAE, UNU-MERIT, Maastricht University & GLO): Welcome of the Section Chair
9.35 – 9.50 am; Martin Kahanec (MAE, Central European University, Acting Dean of CEU School of Public Policy): Welcome of the Host & and CEU Business
9.50 – 10.40 am; Graziella Bertocchi (MAE, Università di Modena e Reggio Emilia): COVID-19, Race, and Redlining Chair: Andreu Mas-Colell (MAE, Universitat Pompeu Fabra)
10.50 – 11.40 am; Matthias Sutter (MAE, University of Cologne & Max-Planck Bonn): Nudging or Paying? Evaluating the effectiveness of measures to contain COVID-19 in rural Bangladesh in a randomized controlled trial. Chair:Reinhilde Veugelers(MAE, University of Leuven)
11.50am – 12.40 pm;Anil Duman (Guest, Central European University): Wage Losses and Inequality in Developing Countries: labor market and distributional consequences of COVID-19 lockdowns in Turkey Chair: Klaus F. Zimmermann(MAE, UNU-MERIT, Maastricht University & GLO)
12.40 – 13.50 pm; Lunch with 3 random “seat” allocations…. (virtual, participants brought food and drinks and exchanged views in three changing group rounds)
13.50 – 14.40 pm; Peter Nijkamp (MAE, Vrije Universiteit Amsterdam): Corona Impacts on the Hospitality Market. A Space-time Economic Roller-Coaster Analysis Chair:Martin Kahanec (MAE, Central European University)
14.50 – 15.40 pm; Luiz Moutinho (MAE, University of Suffolk): Artificial Intelligence and Control of COVID-19 Chair: Mirjana Radovic-Markovic (MAE, Institute of Economic Sciences)
15.40 – 15.50 pm; “Conference picture – group photo”.
Some visible participants:
15.50 – 16.40 pm; Marcella Alsan(Guest, Harvard University): Civil Liberties in Times of Crises Chair: Amelie Constant (MAE, Princeton University)
16.40 – 16.50 pm; Final remarks: Martin Kahanec& Klaus F. Zimmermann 16.50 – 17.00 pm; “After the hour”: Section Committee only. Group photo.
The end.
AE Section Committee“Economics, Business and Management Sciences”
The GLO Virtual Young Scholars Program (GLO VirtYS) 2020/2021 has started its activity.
In the spirit of the GLO Mission, the GLO VirtYS program’s goal is to contribute to the development of the future generation of researchers, who are committed to the creation of policy-relevant research, are well equipped to work in collaboration with policy makers and other stakeholders, and adhere to the highest standards of academic integrity. This goal is achieved through the process of working on a specific research paper within the duration of the program, which is 9 months, and interact with the GLO VirtYS cohort and advisors.
Under the leadership of GLO VirtYS Program Director Olena Nizalova, the participants have virtually met with GLO officials and advisors on November 12 for a warm welcome and first interactions. GLO PresidentKlaus F. Zimmermann and GLO Director Matloob Piracha made introductory remarks. GLO VirtYS Program Assistant Yannis Galanakis reported from his experience as a member of the GLO VirtYS 2010/2020 cohort.
The following program participants have been appointed GLO Affiliate:
Third IESR-GLO Joint Conference. The Institute for Economic and Social Research (IESR) at Jinan University and the Global Labor Organization (GLO) were jointly organizing a virtual conference on economic issues related to the coronavirus (Covid-19) pandemic.
The conference was held from June 5 (Friday) to June 7 (Sunday) through Zoom Webinar. Full Program.Over 300 participants worldwide.
Keynote addresses by Daron Acemoglu (MIT) and Charles Manski (Northwestern University). Links lead to the videos of the keynote lectures. – June 5, 2020. Daron Acemoglu (MIT): A Multi-risk SIR Model with Optimally Targeted Lockdown Large gains from targeted policy! – June 6, 2020. Charles Manski (Northwestern University): Coping with COVID Uncertainties We must take care when performing!
The conference is supported by theJournal of Population Economics. The Journal welcomes submissions dealing with the demographic aspects of the coronavirus crisis.
Quo Vadis Europe after the European elections? Martin Kahanec and Klaus F. Zimmermann (both Budapest) debated on June 5, 2019 with Elsa Fornero (Turin) and Jonathan Portes (London) the consequences and perspectives for Europe in front of a larger audience assembled at the Central European University in Budapest. Zimmermann, President of the Global Labor Organization (GLO), was chairing and moderating the event; Fornero, Kahanec and Portes are GLO Fellows.
The common economic and political development in Europe, in particular labor mobility, labor market reforms, evidence-based policy making and the role of scientists have been key elements of the public debate about the future of Europe. EU-pessimism has become stronger and stronger, and the recent EU elections provide guidance about the potentials for a recovery of the European idea in the face of Brexit and a possible dismantling of European institutions. The panel brought together experienced academic exponents combing research with policy for debate at this critical point of European history.
Klaus F. Zimmermann, George Soros Chair Professor, School of Public Policy, Central
European University (CEU), President of the Global Labor Organization (GLO), frequent
advisor to the EU Commission and European governments and Former President of
the German Institute for Economic Research (DIW Berlin); Chair & Panelist
Populism and anti-globalism is on the rise.
Evidence-based policymaking is losing weight.
The value of migration and international institutions is questioned.
The freedom of academic institutions gets under threat.
Scientist are challenged to analyze and to respond to this development when also their insights are ignored.
Voters move away from centrist parties, who lose majority.
Pro-European liberals and greens become stronger and are now a third force.
Anti-parties (anti-Europe, anti-migration) are stronger, but not dramatically.
This is all a vote for a revival of the European idea.
Facing strong global challenges from Asia, Africa and the USA, Europe needs to stick together and develop from its strength.
More Europe not less is needed in the interest of the European nations and its people.
This implies re-inventing the European idea and export some of its great institutions: social institutions, education and training and labor mobility.
Elsa Fornero, Professor of Economics, University of Turin, Department of
Business and Economics, Scientific Coordinator of CeRP – Center for Research on
Pensions and Welfare Policies and Former Minister of Labor, Social Policies and
Gender Equality in Italy; Panelist
Reforms must live in society with the people – workers, politicians, pensioners, etc. It is not a purely technical problem.
We, technocrats, believed in reforms but the society did not accept them. The society misunderstood the policies as austerity measures.
Economic models are dealing with prosperity, but real policymaking is about elections, which are always around the corner.
The populists saw the weak points of reformists and the discontent of people and exploited them.
Labor mobility and work in Europe should be reestablished as a right of the individuals and this should be in the center of the new Europe.
We should strengthen the civil society –politicians and the elites should go out and talk to the people.
Martin Kahanec, Professor and Dean of the School of Public Policy, Central European University (CEU), Budapest, and frequent advisor to the EU Commission; Panelist
These elections showed the discontent between East and West, South and North, globalists and localists
In the 90s the region had a dream – get rid of the Soviets, which unified the societies. And move back to Europe – Schengen, EU, Eurozone, etc. However, after they joined the EU there is a vacuum of dreams. What is our next mission?
Although the lowest election participation was in Slovakia, it is a EU positive country.
Elites and workers feared migration from outside of Europe. But not internal labor mobility.
Internal mobility helps build bridges over the old cleavages, but is also beneficial economically.
Europe should have a policy for external migration which tackles the aging population challenge. The EU needs a migration framework, which is economically profitable, but also needs to have control and be predictable.
Jonathan Portes, Professor of Economics and Public Policy, Senior Fellow, UK in a
Changing Europe, Department of Political Economy, King’s College London, Former
Chief Economist of the UK government, Former Director of the National Institute
of Economic and Social Research; Panelist
The long term forces behind Brexit were not migration, but that the EU is not only an economic but also a political project. And the British felt that their positions in the world were threatened. Sentiments in this direction grew after the world economic crisis.
The Britishattitude towards migration has changed after the referendum, becoming more positive. It has to do with a drop in the migration from the EU, and an increase from the outside. The gaps created were filled with workers from outside of the EU, and the need was better understood.
The lack of control scared people because they wanted the “right” immigration
If one provides a sense of control and of the existing trade-offs, the situation will approve.
Thanks to the failure of May we are likely to have a hard Brexit or to reverse the results and stay in the EU. There is no middle ground anymore. Even if in a second vote the result would be “remain” – the issue would not be settled.
People thought that Brexit would be easy and not painful; they now realize how wrong they were.
If Germany turns into success its refugee immigration, then Germans would send to Europe a tremendously positive example.
From the left during the panel:Klaus F. Zimmermann, Chair, Budapest and Bonn; Jonathan Portes, London; Elsa Fornero, Turin; and Martin Kahanec, Budapest and Vienna.
After the panel during a joint dinner from the left: The Honorable Tanya Cook, USA; CEU Professor Anil Duman and GLO Fellow; Turin Professor and Former Labor Minister Elsa Fornero; CEU Dean and Professor Martin Kahanec; and Klaus F. Zimmermann, George Soros Chair, CEU, and GLO President.
The joint FOM-GLO-KAS Conference about “Climate Change and Human Responses” co-organized by the Global Labor Organization (GLO), FOM University of Applied Sciences and Konrad Adenauer Foundation (KAS) took place on October 31 – November 2 in Hong Kong. (See for detailed reports: DAY ONE, DAY TWO, DAY THREE ) Here are some further impressions (courtesy of KAS):
Conference participants at Day 2 after lunch.
Conference organizers (from the left): GLO President Klaus F. Zimmermann, Peter Hefele, Director of the Hong Kong branch of the German Konrad-Adenauer Foundation and Andreas Oberheitmann (FOM, RWI and GLO).
RECENT GLO Discussion Papers on the issue of the conference (freely downloadable):
