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Open Access Publications from the University of California

The Institute for Research on Labor and Employment promotes better understanding of the conditions, policies, and institutions that affect the well-being of workers and their families and communities. We inform public debate with hard evidence about inequality, the economy, and the nature of work.

Steven Raphael

Director

Institute for Research on Labor and Employment
University of California, Berkeley
2521 Channing Way
Berkeley, CA 94720-5555
http://irle.berkeley.edu/
irle@berkeley.edu

Cover page of State and Local Policies and Sectoral Labor Standards: From Individual Rights to Collective Power

State and Local Policies and Sectoral Labor Standards: From Individual Rights to Collective Power

(2021)

The United States enterprise-based collective bargaining regime creates substantial limitations for organizing workers where supply chains are increasingly disaggregated in ways that reduce worker power. Federal labor law generally preempts state and local policies that directly address private sector bargaining. State and local governments, however, are not preempted from setting general labor standards. We look at four cases of recent experiments at the local level with sectoral standards. Our cases show that sectoral standards have the potential to expand new forms of social bargaining at the state and local level through public policy in areas of the country where worker organizations are already strong. They can do so in ways that promote worker organization and build institutional power, especially when combined with robust worker organizing. In doing so they show both the potential power, and limitations, of federalism in US workplace.

Cover page of Designing at the Margins: How Senior School District Leaders of Color Learn to Enact Equitable Policies and Practices

Designing at the Margins: How Senior School District Leaders of Color Learn to Enact Equitable Policies and Practices

(2021)

One central theory undergirding the Equity by Design (ExD) Community of Practice (CoP) is that building the capacity of district teams, composed primarily of leaders of color, to transform organizations has the potential to create conditions for more equitable outcomes for historically marginalized students. Caroline Hill, the CoP facilitator, used the Equity Action Framework Tool (EAFT), empathy interviews, and equity walks during in-person convenings, webinars, and local collaborations to deepen participants’ learning. The CoP was comprised of district leaders of color (n = 27) from five school districts in the Midwest and East Coast, all of whom served predominantly students of color who also qualified for free or reduced lunch.

We use the EAFT, a research-based tool of individual and collective leadership dispositions and competencies, to test ExD’s theory of action. Specifically, we explored three research questions:

Research Question 1: How do school district leaders of color participating in the ExD CoP learn to design and implement equitable policies and practices aimed at closing persistent opportunity gaps?

Research Question 2: To what degree do school district leaders of color change policies and practices aimed at closing persistent opportunity gaps after participating in a CoP?

Research Question 3: To what degree do school district leaders of color describe changes in their policies and practices aimed at closing persistent opportunity gaps after participating in a CoP?

First, we found that CoP members learned to design and implement equitable policies and practices aimed at closing opportunity gaps through the use of (a) skillful facilitation, (b) learning about the past to design for the future, and (c) core characteristics of the CoP.

Second, after analyzing pre-, mid- and post-survey responses, we found that participants reported that their greatest learning was in the areas of (a) being able to assess the will, skill, knowledge, and capacity of the organization to disrupt inequitable policies and practices; and (b) developing a theory of change to disrupt inequitable policies and practices based on an analysis of data.

Third, we found that school closure and reopening plans due to the COVID-19 pandemic created a unique opportunity to understand how school systems were applying their learning from the CoP to design policies and practices aimed at closing persistent opportunity gaps.

We provide four important recommendations for the ExD portfolio as it continues to deepen and sustain its impact aimed at supporting school district leaders of color to design equitable policies and practices: (a) continued support for the ExD CoP beyond the initial 1-year period; (b) focus on practice in particular in the next iteration of the CoP; (c) include a 3 geographic representation of schools in future CoPs that account for both charter and traditional public schools; and (d) continue to use the EAFT in future CoPs to deepen and sustain ExD team members’ capacity to design equitable policies and practices.

Cover page of Racial Inequality and Minimum Wages in Frictional Labor Markets

Racial Inequality and Minimum Wages in Frictional Labor Markets

(2021)

We examine how the racial patchwork of federal and state minimum wage changes between 1990 and 2019 has affected racial wage gaps, with specific attention to effects on labor market frictions. Black workers on average are less likely to live in high-wage states that have raised their wage floors. The effect of state minimum wages on the national racial wage gap is thus not self-evident.

Using five different causal specifications, including the “bunching” estimator of Cengiz et al. (2019), and data from the CPS and the QWI, we find that minimum wage changes since 1990 did reduce the 2019 racial wage gaps, by 12 percent among all workers and 60 percent among less-educated workers. The reductions are greater among black women and among black prime age workers. The gains for black workers are concentrated well above the new minimum wage, beyond the usual spillover estimates. Earnings of all race/ethnic/gender groups grew, with larger effects among black workers. We do not find disemployment effects for any group.

Surprisingly, racial differences in initial wages do not explain the reduction in the racial wage gap. Rather, minimum wages expand job opportunities for black workers more than for white workers. We present a model in which minimum wages assist the job search of workers who do not own automobiles and who live farther from jobs. Our causal results using the ACS show that minimum wages increase commuting via automobile among black workers, supporting our model. Minimum wages also reduce racial gaps in separations and hires, further suggesting the policies especially enhance job opportunities for black workers.

Cover page of COVID-19, Public Charge Rules, and Immigrant Employment in the United States

COVID-19, Public Charge Rules, and Immigrant Employment in the United States

(2021)

This article examines the impact of the COVID-19 pandemic on immigrant employment in the United States using data from the Current Population Survey. It also provides the first evidence about the impact of the new public charge rules on the employment behavior of immigrants during the post-outbreak recovery. The authors find that among immigrants with household earnings at levels that make them susceptible to inadmissibility under the new rules, noncitizen status is associated with a 3.7% increase in employment among immigrant men. This effect is robust to inclusion of controls for socioeconomic characteristics and various fixed effects, and it is concentrated for men in states with below average unemployment benefit take-up. Findings also show that the differential employment effect is stronger in state-months with higher COVID-19 rates, suggesting that impacted workers may be increasing their workplace exposure to COVID-19.

Cover page of The Costs of Employment Segregation: Evidence from the Federal Government under Wilson

The Costs of Employment Segregation: Evidence from the Federal Government under Wilson

(2020)

We link personnel records of the federal civil service to census data for 1907-1921 to study the segregation of the civil service by race under President Woodrow Wilson. Using a difference-indifferences design to compare the black-white wage gap around Wilson’s presidential transition, we find that the introduction of employment segregation increased the black wage penalty by 7 percentage points. This gap increases over time and is driven by a reallocation of already-serving black civil servants to lower paid positions. Our results thus document significant costs borne by minorities during a unique episode of state-sanctioned discrimination.

Cover page of Racial and Class Inequality in U.S. Incarceration in the Early Twenty-First Century

Racial and Class Inequality in U.S. Incarceration in the Early Twenty-First Century

(2020)

The relative importance of racial and class inequality in incarceration in the United States has recently become the subject of much debate. In this paper, we seek to give this debate a stronger empirical foundation. First, we update previous research on racial and class inequality in people’s likelihood of being imprisoned. Then we examine racial and class inequality in people’s risk of having a family member imprisoned or living in a high-imprisonment neighborhood. We find that racial inequality in prison admissions has fallen in the twenty-first century, while class inequality has surged. However, in recent years, Black people with high levels of education and income were more likely than White people with low levels of education and income to experience the imprisonment of a family member or to live in a neighborhood with a high imprisonment rate. These seemingly contradictory conclusions can be reconciled by the fact that class boundaries among Black people are more permeable than they are among White people. Imprisonment in the United States is increasingly reserved for the poor. But because Black people are disproportionately connected to the poor through their families and neighborhoods, racial inequality exceeds class inequality in people’s indirect experiences with imprisonment.

Cover page of Pay, Passengers and Profits: Effects of Employee Status for California TNC Drivers

Pay, Passengers and Profits: Effects of Employee Status for California TNC Drivers

(2020)

Uber and Lyft currently treat their California drivers as independent contractors, despite state employment law giving the drivers employee status. The companies claim that drivers are already well-paid and that employee status would bring the industry to its knees. Driver advocates claim that drivers are low-paid and do not receive basic benefits and protections, such as unemployment insurance and workers’ compensation, and that the companies should treat the drivers as employees and adhere to California employment law.

I examine here the economic and financial consequences of switching the drivers to employee status. In particular, I examine the effects on pay and employment of the drivers, the effects on passengers, and the profitability of the industry. I find that: most drivers are paid much less than the current minimum wage and that overall compensation of drivers would increase 30 percent; that driver schedule flexibility would not be affected; passenger demand would fall by 1 or 2 percent; and profits of the companies would increase.

Cover page of Are Minimum Wage Effects Greater in Low-Wage Areas?

Are Minimum Wage Effects Greater in Low-Wage Areas?

(2020)

Empirical work on the minimum wage typically estimate effects averaged across high and low wage areas. Low wage labor markets could potentially be less able to absorb minimum wage increases, in turn leading to more negative employment effects. In this paper we examine minimum wage effects in low wage counties, where relative minimum wage ratios reach as high as .82, well beyond the state-based ratios in extant studies. Using data from the ACS, the QWI and the QCEW, we implement event study and difference-in-difference methods, estimating average causal effects for all events in our sample and separately for areas with lower and higher impacts. We find positive wage effects, especially in high impact counties, but do not detect adverse effects on employment, weekly hours or annual weeks worked. We do not find negative employment effects among women, blacks and/or Hispanics. In high impact counties, we find substantial declines in household and child poverty. These results inform policy debates about providing exemptions to a $15 federal minimum wage in low-wage areas.

Cover page of Tradable Spillovers of Fiscal Policy: Evidence from the 2009 Recovery Act

Tradable Spillovers of Fiscal Policy: Evidence from the 2009 Recovery Act

(2020)

Local fiscal policy shocks propagate between labor markets through the trade in intermediate goods used in final production. Through this channel, each $1 of local aid from the 2009 Recovery Act increased output by $1.33 in the rest of the country over two years, in addition to its local state-level effect of $1.46. Combining both the local and spillover effects, absent other offsetting forces, the implied aggregate multiplier from the Recovery Act was approximately 2.8. A sectoral decomposition of the direct and spillover effects is consistent with the spillover effects being mediated through the trade in intermediate goods.

Cover page of It Ain't Where You're From, It's Where You're At: Hiring Origins, Firm Heterogeneity, and Wages

It Ain't Where You're From, It's Where You're At: Hiring Origins, Firm Heterogeneity, and Wages

(2020)

We develop a theoretically grounded extension of the two-way fixed effects model of Abowd et al. (1999) that allows firms to differ both in the wages they offer new hires and the wages required to poach their employees. Expected hiring wages are modeled as the sum of a worker fixed effect, a fixed effect for the “destination” firm hiring the worker, and a fixed effect for the “origin” firm, or labor market state, from which the worker was hired. This specification is shown to nest the reduced form for hiring wages delivered by semi-parametric formulations of the sequential auction model of Postel-Vinay and Robin (2002b) and its generalization in Bagger et al. (2014). Using Italian social security records that distinguish job quits from firings and layoffs,we demonstrate that our fixed effects model captures well differences in wage growth between workers involved in voluntary and involuntary job transitions. Bias correcting a variance decomposition of hiring wages, we find that origin effects explain only 0.7% of the variance of hiring wages among job movers, while destination effects explain more than 23% of the variance. Across firms, destination effects are more than 13 times as variable as origin effects. Interpreted through the lens of the sequential auction model, this finding requires workers to have implausibly strong bargaining strength. Studying a cohort of workers entering the Italian labor market in 2005, we find that differences in origin effects yield essentially no contribution to the evolution of the gender gap in hiring wages, while differences in destination effects explain the majority of the gap at the time of labor market entry. Our results suggest that where a worker is hired from is relatively inconsequential for his or her wages in comparison to where he or she is currently employed.