Employment

Blog

VoxEU:

Labour market reallocation in the wake of Covid-19

As economies bounce back from Covid-19, our economists question whether the recovery will re-employ all of the workers made redundant during the downturn, and whether they will go back to similar jobs....Read more...

Blog

LSE Covid-19:

A 'lost generation' of young Indian workers urgently needs job opportunities

A year after the pandemic hit India, urban individuals are facing work without pay and long spells of unemployment. Swati Dhingra and Fjolla Kondirolli say a national-level commitment to provide job opportunities is need...Read more...

Blog

VoxEU:

Let me work from home, or I will find another job

Jose Maria Barrero, Nicholas Bloom, Steven Davis examine survey data from American employees currently working from home, and find 40% say they would seek another job if employers require a full return to business premis...Read more...

Submission to a parliamentary inquiry and government consultation

Jobs, growth, and productivity after coronavirus

The Committee will examine how the Government can reduce and mitigate economic scarring and job losses after the pandemic, how much difference the Government can make to economic growth, and what has caused the UK's prod...Read more...

CEP Covid-19 analysis

City of dreams no more, a year on: worklessness and active labour market policies in urban India

This report provides key findings from a new field survey to assess the long-term impact of Covid-19 on urban workers in low-income areas of India. The survey took place during February and March 2021, just before the s...Read more...

CEP discussion paper

Marriage as insurance: job protection and job insecurity in France

Job insecurity is one of the risks that workers face on the labour market. As with any risk, individuals can choose to insure against it. We here consider marriage as a way of insuring against labour-market risk. The 199...Read more...

Blog

VoxEU:

Start-ups in the time of COVID-19: Facing the challenges, seizing the opportunities

Flavio Calvino, Chiara Criscuolo and Rudy Verlhac explore ways for policymakers to incentivise businesses and speed up economic recovery against Covid-19's effect on start-ups and new firms....Read more...

Blog

Economics Observatory:

School's in: are more of the young staying in education during the downturn?

With Covid-19's effect on the availability of part-time and weekend jobs, more young people are staying on at school. Jonathan Wadsworth examines the links between study and work in the youth labour market....Read more...

Blog

VoxEU:

Returning to the office will be hard

The Covid-19 pandemic prompted a collective shift to working from home. This column argues that though the shift was surprisingly easy, returning to the office will be hard. New evidence from a survey of 2,500 employees ...Read more...

CentrePiece article

Beyond income inequality: non-monetary rewards to work

Discussion of income inequality focuses primarily on wages with limited consideration of the non-monetary rewards to work, not least the satisfaction that employees experience in doing their jobs. Andrew Clark, Maria Cot...Read more...

CentrePiece article

The motherhood penalty for working women in Spain

Spain has seen a huge influx of women into the workplace in recent decades, but their experiences of work remain very different from those of men. As Claudia Hupkau and Jenifer Ruiz-Valenzuela explain, there is scope for...Read more...

CentrePiece article

in brief... Covid-19 and self-employment

The pandemic has had particularly damaging economic effects on self-employed people in the UK. CEP has now run three surveys to capture the experience of these workers during the crisis. Stephen Machin and Maria Ventura ...Read more...

CentrePiece article

Ethnic minorities and the UK labour market

Contrary to the impression given by the Sewell Report, there has been little change in disparities in pay, employment and unemployment among different ethnic groups in the UK over the past 25 years. Indeed, as analysis o...Read more...

Blog

Economics Observatory:

Retraining: which are the best policies for getting people back to work?

Many people are expected to lose their jobs in the aftermath of the pandemic. Retraining will be one important way to get them back into work. Chiara Cavaglia, Sandra McNally, Jenifer Ruiz-Valenzuela show there is a good...Read more...

Blog

Economics Observatory:

What is the future of commuting to work?

Around half the UK labour force is currently working from home. Paul Mizen, Nick Bloom, Shivani Taneja analyse survey data suggesting that spending two to three days a week at home is the most common expected working pat...Read more...

Blog

LSE Blogs: politics and policy:

Why the UK-India Young Professionals Scheme might end up benefitting a handful of large companies

The announcement of a new visa for young, professional Indians to work in the UK could prove popular - but an eye needs to be kept on how it ends up being used in practice, writes Alan Manning....Read more...

Blog

VoxEU:

Lockdowns widen the gender gap in mental health

Women, the young, and the less educated have borne the brunt of the economic damage caused by the Covid-19 pandemic and lockdowns in terms of job and earnings losses. As this column reports, women have also suffered far ...Read more...

Blog

Economics Observatory:

What is the future of working from home?

Working from home has become more common during the pandemic, but only in certain sectors. Jonathan Haskel writes about the likelihood that the practice will be permanently adopted depends on perceptions of workforce pro...Read more...

Blog

LSE Blogs:

Contrary to the impression given by the Sewell Report, things for ethnic minorities in the UK labour market are not getting better

Using estimates from the Labour Force Survey, Alan Manning and Rebecca Rose fill in some of the gaps of the government's Sewell Report on race and ethnic disparities. Comparing disparities in pay, employment, and unemplo...Read more...

CEP discussion paper

The importance of capital in closing the entrepreneurial gender gap: a longitudinal study of lottery wins

Can capital constraints explain why there are more male than female entrepreneurs in most societies? We study this issue by exploiting longitudinal data on lottery winners. Comparing between large to small winners, we fi...Read more...

Journal article

Journal of the European Economic Association:

Parents, Schools and Human Capital Differences Across Countries

This paper studies the contribution of parental influence in accounting for cross-country gaps in human capital achievements. We argue that the cross-country variation in unobserved parental characteristics is at least a...Read more...

Blog

LSE Blogs:

Work and children: is the motherhood penalty in Spain too high for working women?

Spain has seen a huge influx of women into the workplace, but men and women's experiences of work remain very different. Claudia Hupkau and Jenifer Ruiz-Valenzuela say there is scope for new family-friendly policies to h...Read more...

Blog

LSE Blogs:

COVID-19 and self-employment ten months into the crisis

Almost a year into the crisis, the latest lockdown has hit the self-employed hard in the UK. In January 2021, 57% of surveyed self-employed workers were earning less than £1,000 per month, up from 31% in January 2020 an...Read more...

CEP Covid-19 analysis

Covid-19 and the self-employed - ten months into the crisis

Almost a year into the Covid-19 crisis, it has become widely acknowledged that UK self-employment has been particularly hard hit. Here we continue our series investigating the experience of self-employed workers througho...Read more...

Journal article

Journal of Urban Economics:

The local economic impacts of regeneration projects: Evidence from UK's single regeneration budget

Many governments aim to improve the labour market outcomes of people living in deprived areas through "place-making" initiatives. Economists are often sceptical about the effectiveness of such policies, but empirical evi...Read more...

Journal article

Journal of Urban Economics:

The impact of public employment: Evidence from Bonn

This paper evaluates the impact of changes in public employment on private sector activity using the creation of the new West German government in Bonn in the wake of the Second World War as a source of exogenous variati...Read more...

Blog

LSE Blogs:

LSE Festival 2021 | Many of us will return to offices - but not for the whole week

As the pandemic drags on, employers have got better at organising their staff to work from home, says Daniela Scur (Cornell University and LSE). Not all will return to the office, and many will never go back to the five-...Read more...

CentrePiece article

Lockdown and the social life of big cities

The effects of Covid-19 on the social lives of city dwellers - being able to go to the pub, restaurants and theatre - may be more relevant for the future of cities than its impact on work. That's the implication of a tho...Read more...

CentrePiece article

In brief... Lockdown, recession and crime

What has happened to criminal activity in England and Wales during the pandemic? Tom Kirchmaier and Carmen VillaLlera explore the effects of lockdown and job loss on the kinds of crimes being committed – and the ability ...Read more...

Blog

LSE US Centre:

Trade protection along supply chains: how antidumping measures against China hurt downstream industries

Production processes are often no longer confined to a single country; supply chains can be fragmented across great distances. By contrast, tariffs are often used by individual countries to protect certain industries. In...Read more...

Blog

VoxEU:

Trade protection along supply chains: The negative effects of tariffs on downstream sectors

In a world in which production processes are fragmented across countries, the effects of tariffs propagate along supply chains, with firms in downstream industries suffering from protection upstream. This column studies...Read more...

Blog

The state of working Britain:

Covid-19 and the Youth Labour Market. The Kids are (Probably) Alright

Jonathan Wadsworth considers youth unemployment in light of the UK's furlough scheme, the end of lockdowns and economic downturn....Read more...

Blog

LSE Business Review:

New incentives for businesses to train their employees are needed for economic recovery from COVID-19

The need to retrain or upskill the workforce has become ever more urgent due to sharp changes in skills demand induced by the pandemic, write Jiaqi Li, Guglielmo Ventura and Anna Valero....Read more...

CEP discussion paper

Worker and firm responses to trade shocks: The UK-China case

We exploit the recent surge in Chinese export growth to study the effects of a trade shock on workers and firms in a foreign market, the UK, in the period 2000-2007. We find that individuals initially employed in sectors...Read more...

CEP discussion paper

Trade protection along supply chains

During the last decades, the United States has applied increasingly high trade protection against China. We combine detailed information on US antidumping (AD) duties— the most widely used trade barrier — with US input-o...Read more...

Journal article

The Economic Journal:

Adjustment Costs and Factor Demand: New Evidence from Firms’ Real Estate

We study corporate real estate frictions and their effect on firm dynamics and labour demand. We build and simulate a general equilibrium model with heterogeneous firms that predicts the response of firms to a productivi...Read more...

Journal article

The Economic Journal:

Trapped Factors and China’s Impact on Global Growth

After a recent increase in Chinese import competition, European firms increased innovation. We present and rationalise these patterns using ‘trapped factors’ at the micro level within a stylised equilibrium model of prod...Read more...

External publication

IZA Research Report No. 105:

IZA COVID-19 Crisis Response Monitoring: United Kingdom

On the 23rd of March, the United Kingdom locked down in response to the COVID-19 pandemic. Subsequently, the UK economy suffered the biggest contraction of economic activity in 41 years, experiencing a 21.5% year-on-year...Read more...

Blog

LSE Blogs:

What happened when parents lost their jobs during lockdown?

Many parents had to cope with losing their jobs or part of their income at the same time as they were forced to home school. How did this affect their children's learning and their mental health? Claudia Hupkau, Ingo Isp...Read more...

CEP Covid-19 analysis

Covid-19 and changing crime trends in England and Wales

We document changing crime trends in England and Wales in the context of the current global pandemic. During the first lockdown that span from mid-March to mid-May 2020 there was a decrease in all crime categories except...Read more...

Blog

LSE Business Review:

Lockdown shows us it is not work that attracts us to big cities - but the social life

Covid-19's effect on the social lives of city dwellers - being able to meet at the pub, restaurants or theatre - may be more relevant for the future of cities than its impact on work, write Gabriel Ahlfeldt, Fabian Bald,...Read more...

CEP discussion paper

Are bigger banks better? Firm-level evidence from Germany

The effects of large banks on the real economy are theoretically ambiguous and politically controversial. I identify quasi-exogenous increases in bank size in post-war Germany. I show that firms did not grow faster after...Read more...

Blog

The State of Working Britain:

Long-Term Unemployment and the Covid Downturn

With the first signs of rising unemployment under the crisis are beginning to ripple through the labour market, Jonathan Wadsworth examines trends in employment against unemployment, the chances of finding work among tho...Read more...

CEP discussion paper

Pandemics, global supply chains and local labor demand: evidence from 100 million posted jobs in China

This paper studies how the COVID-19 pandemic has affected labor demand, using over 100 million posted jobs on one of the largest online platforms in China. Our data reveal that the number of newly posted jobs within the ...Read more...

Blog

LSE British Politics and Policy:

How lockdowns have reversed traditional gender roles in some UK households and further entrenched them in others

Claudia Hupkau and Barbara Petrongolo discuss what the likely implications of a second lockdown are for gender equality at work and in the home....Read more...

CEP Covid-19 analysis

Covid-19 and the self-employed: six months into the crisis

Six months after Covid-19 first hit, it is clear that it is the greatest economic crisis of the modern age. The economy has contracted far more rapidly than in previous crises, with GDP dropping by a record 19.5 per cent...Read more...

Blog

State of Working Britain Blog:

Who's being made redundant during COVID? Who is staying at work. And is it any different from usual?

Following his previous blog post looking at trends in redundancies over the COVID period relative to previous downturns, Jonathan Wadsworth looks to understand who is being laid off and whether this is any different from...Read more...

Blog

State of Working Britain Blog:

Redundancies and the labour market under Covid. Has furlough helped? And other related things you may have missed

Redundancies are often seen as commensurate with unemployment - but not always. In this blog post, Jonathan Wadsworth analyses the links between the UK's furlough scheme and redundancies....Read more...

CentrePiece article

In brief... Monopsony in labour markets: what it is, why it matters

Many firms are able to exploit the fact that it is hard for workers to move from one employer to another, keeping wages lower than they would be in a competitive market. As Alan Manning explains, labour markets are becom...Read more...

Blog

VoxEU:

The impact of public employment: evidence from West Germany's post-war capital Bonn

Raising the level of public employment is a frequently used policy instrument to support economically lagging regions. This column evaluates the impact of changes in public employment on private sector activity using the...Read more...

Blog

CVER blogs:

Stark contrast between pre- and post-16 provision in UTCs

At a time when Prime Minister Boris Johnson has put the government’s skills policy agenda in the spotlight, Guglielmo Ventura presents findings from his research seeking to understand whether UTCs were successful at br...Read more...

CEP Covid-19 analysis

Jobs for a strong and sustainable recovery from Covid-19

The UK’s future economic, social and environmental prosperity will be shaped by how it deals with, and recovers from, the impact of Covid-19. This paper sets out coordinated net-zero-aligned investments which the UK can ...Read more...

Journal article

The Economic Journal:

The impact of terrorism on individual well-being: Evidence from the boston marathon bombing

A growing literature has concluded that terrorism affects the economy, yet less is known about its impact on individual welfare. This article estimates the impact of the 2013 Boston marathon bombing on well-being, exploi...Read more...

Journal article

Journal of Economic Perspectives:

Solo self-employment and alternative work arrangements: a cross-country perspective on the changing composition of jobs

The nature of self-employment is changing in most OECD countries. Solo self-employment is increasing relative to self-employment with dependent employees, often being associated with the development of gig economy work a...Read more...

Journal article

SERIEs:

Job loss at home: children's school performance during the Great Recession

This paper studies the intergenerational impact of parental job loss on school performance during the Great Recession in Spain. Collecting data through parental surveys in a school in the province of Barcelona, I obtain ...Read more...

Submission to a parliamentary inquiry and government consultation

Employment and Covid-19

The Committee will examine the effects of the COVID-19 pandemic on the labour market and consider what urgent measures should be taken to protect and create jobs. It will also examine how the labour market may change as ...Read more...

Blog

LSE Business Review:

Why we need to do something about the monopsony power of employers

Monopsony decreases worker mobility, keeping wages lower than they would be in a competitive market, writes Alan Manning...Read more...

CEP Covid-19 analysis

What can previous recessions tell us about the Covid-19 downturn?

The labour market effects of the Covid-19 crisis measured as of June 2020 are compared with the three most recent UK recessions: the early 1980s, the early 1990s, and the downturn induced by the global financial crisis i...Read more...

Journal article

Fiscal Studies:

Devolving skills: the case of the apprenticeship grant for employers

One rationale for devolution is that local decision makers may be well placed to adapt national policies to the local context. We test whether such adaptation helps meet programme objectives in the case of the Apprentice...Read more...

CentrePiece article

Covid-19 and the future of self-employment

Jack Blundell reports how self-employed workers have been particularly hard hit by the crisis....Read more...

Journal article

Regional Science and Urban Economics:

The effects of supporting local business: evidence from the UK

This paper assesses the effects of a significant place-based intervention that targeted local businesses in deprived areas in the UK. To gain identification, we use data at a fine spatial scale and a regression discontin...Read more...

Journal article

The Review of Economics and Statistics: Forthcoming

A Natural Experiment on Job Insecurity and Fertility in France

Job insecurity can have wide-ranging consequences outside of the labour market. A 1999 rise in the French layoff tax paid by large private firms when they laid off older workers made younger workers less secure; this ins...Read more...

Blog

Economics Observatory:

Which firms and industries have been most affected by Covid-19?

Almost all UK businesses have been badly affected by the spread of Covid-19, but some industries have been hit harder than others. Financial market data and surveys of firms themselves provide insights into the scale of ...Read more...

CEP Covid-19 analysis

Covid-19 and social mobility

Governments are having to balance short- and long-term interests, and the trade-offs they generate, as they try to recover from the Covid-19 pandemic. Social distancing measures may limit the number of immediate deaths f...Read more...

CEP Covid-19 analysis

Self-employment in the Covid-19 crisis

The Covid-19 shock is one of the largest economic shocks that has taken place in living memory. The crisis has served to highlight the challenges governments face in extending social insurance to self-employed workers, f...Read more...

Blog

LSE Covid-19 blog:

How a job guarantee scheme can avoid the slide into long-term unemployment

Even if COVID-19 infection rates dwindle, it is now clear that the economy is unlikely to bounce back quickly. This raises the spectre of long-term unemployment. Richard Layard (LSE) explains how the government could dra...Read more...

CEP Covid-19 analysis

Work, care and gender during the Covid-19 crisis

The Covid-19 crisis has especially hit service sectors with frequent social interactions, in which women are over-represented. At the same time, if not directly subject to the lock-down, women are more likely to hold job...Read more...

Blog

LSE Business Review:

The Covid-19 recession is creating a crisis of inequality

Earnings may be affected differently by age, gender, and firm size, with large cuts for the young in small firms, write Brian Bell, Nick Bloom, Jack Blundell, and Luigi Pistaferri...Read more...

CEP discussion paper

A natural experiment on job insecurity and fertility in France

Job insecurity can have wide-ranging consequences outside of the labour market. We here argue that it reduces fertility amongst the employed. The 1999 rise in the French Delalande tax, paid by large private firms when th...Read more...

CentrePiece article

The UK's self-employed workers: who they are and what they need

One in seven people in the UK workforce is now in self-employment – but this is a very diverse community. Jack Blundell is developing a typology of self-employed workers, which can then be used to assess differences in h...Read more...

CEP occasional paper

Clusters in UK Self-Employment

UK Self-employment has soared in recent years. With existing labour market policy designed to cater for conventional employee relationships, policymakers in this field are increasingly seeking to better understand these ...Read more...

CEP discussion paper

The contribution of immigration to local labor market adjustment

The US suffers from persistent local disparities in employment rates, which should in principle be eliminated by population mobility. Can immigration accelerate this process? Remarkably, on average since 1960, new immigr...Read more...

CEP discussion paper

Immigration, local crowd-out and undercoverage bias

Using decadal census data since 1960, I cannot reject the hypothesis that new immigrants crowd out existing residents from US commuting zones and states one-for-one. My estimate accounts explicitly for dynamic local adju...Read more...

Journal article

Journal of Economic Perspectives:

The elusive employment effect of the minimum wage

Vacant, previously-developed land in cities can generate negative externalities on surrounding areas, and is often the target of policies to promote re-development. This paper provides estimates of the price sensitivity ...Read more...

Journal article

Journal of Health Economics:

Child sleep and mother labour market outcomes

We show that sleep deprivation exerts strong negative effects on mothers’ labour market performance. To isolate variations in maternal sleep, we exploit unique variations in child sleep disruption using a UK panel datase...Read more...

Journal article

Labour Economics:

Intergenerational effects of employment protection reforms

Job insecurity has worsened in most OECD countries in the aftermath of the Great Recession. Using Labour Force Survey data, I estimate the link between parental job insecurity (as measured by the contract type held by pa...Read more...

CVER Briefing Note

Inequality in education and labour market participation of young people across English localities:An exploration based on Longitudinal Education Outcomes (LEO) data

Currently, 792,000 16-24-year olds in the UK – 11.5% of the age group – are Not in Education, Employment or Training (NEET), but not much is known about how this differs by local area. In this Briefing Note, we provide c...Read more...

CEP election analysis

The labour market

The UK labour market, at first glance, seems to be playing at Dr Jekyll and Mr Hyde. Employment (in terms of both levels and rates) is at record highs, yet wage growth has been extraordinarily weak. One view is that thes...Read more...

Journal article

Economic Journal:

Can Helping the Sick Hurt the Able? Incentives, Information and Disruption in a Welfare Reform

The UK Jobcentre Plus reform sharpened bureaucratic incentives to help disability benefit recipients (relative to unemployment insurance recipients) into jobs. In the long run, the policy raised exits off disability bene...Read more...

CentrePiece article

The gig economy and workers' preferences for steady jobs

Is the rise of gig work, freelancing, zero hours contracts and self-employment a result of people wanting such work or because they have no other choice? Nikhil Datta finds that while workers in the gig economy may like ...Read more...

Blog

LSE British Politics and Policy:

Residential mobility in the UK: how distance and local economic conditions drive residential choices

Monica Langella and Alan Manning find that high unemployment in an area induces people to move away, and has an even stronger effect on the attractiveness of that area to potential movers. They also find that younger and...Read more...

CEP discussion paper

Residential mobility and unemployment in the UK

The UK has suffered from persistent spatial differences in unemployment rates for many decades. A low responsiveness of internal migration to unemployment is often argued to be an important cause of this problem. This pa...Read more...

CEP discussion paper

Willing to pay for security: a discrete choice experiment to analyse labour supply preferences

This paper investigates the extent to which labour supply preferences are responsible for the marked rise in atypical work arrangements in the UK and US. By employing vignettes in a discrete job choice experiment in a re...Read more...

Journal article

Economic Policy:

Zero Hours Contracts and Labour Market Policy

The evolving nature of atypical work arrangements is studied. A particular focus is placed on one such form of work relation: zero hour contracts (ZHCs). The paper uses existing secondary data and new survey data collect...Read more...

CVER Research Paper

Devolving Skills: The case of the Apprenticeship Grant for Employers

One rationale for devolution is that local decision makers may be well placed to adapt national skills’ policies to the local context. We test whether such adaptation helps meet programme objectives in the case of the A...Read more...

Journal article

American Economic Review:

Some causal effects of an industrial policy

We exploit changes in the area-specific eligibility criteria for a program to support jobs through investment subsidies. European rules determine whether an area is eligible for subsidies, and we construct instrumental v...Read more...

CEP discussion paper

Subsidizing labor hoarding in recessions: the employment and welfare effects of short time work

The Great Recession has seen a revival of interest in policies encouraging labor hoarding by firms. Short time work (STW) policies, which consist in offering subsidies for hours reductions to workers in firms experiencin...Read more...

Journal article

Fiscal Studies:

Off EU Go? Brexit, the UK Labour Market and Immigration

Immigration remains a highly antagonistic issue and its purported effects in the labour market are still contestable. Against this background, the UK looks set to undertake a large overhaul of its immigration policy foll...Read more...

CEP discussion paper

The contribution of foreign migration to local labor market adjustment

The US suffers from large regional disparities in employment rates which have persisted for many decades. It has been argued that foreign migration offers a remedy: it “greases the wheels” of the labor market by accelera...Read more...

Journal article

Economics Letters:

The regional effects of Germany's national minimum wage

We show that the minimum wage introduced in Germany in 2015 led to spatial wage convergence, in particular in the left tail of the distribution, without reducing relative employment in low-wage regions within the first t...Read more...

CEP discussion paper

The economic impacts of constraining home investments

We investigate how political backlash against wealthy investors in high-amenity places affects local residents. We exploit a quasi-natural experiment: the ‘Swiss Second Home Initiative’, which banned the construction of ...Read more...

Journal article

American Economic Review:

The persistence of local joblessness

Differences in employment-population ratios across US commuting zones have persisted for many decades. We claim these disparities represent real gaps in economic opportunity for individuals of fixed characteristics. Thes...Read more...

CentrePiece article

Care homes: effects of the National Living Wage

The National Living Wage, which was introduced in 2016, has substantially raised wages at the bottom of the hourly wage distribution in care homes in England, a sector that employs a large number of low-paid workers. Acc...Read more...

Journal article

American Economic Journal: Economic Policy:

A Macroeconomic Approach to Optimal Unemployment Insurance: Applications

In the United States, unemployment insurance (UI) is more generous when unemployment is high. This paper examines whether this policy is desirable. The optimal UI replacement rate is the Baily-Chetty replacement rate plu...Read more...

Journal article

Social science & medicine:

Ownership and hospital behaviour: Employment and local unemployment

In this paper, we address two issues: i) how hospital employment changes with local unemployment, according to the type of hospital ownership, and ii) whether this relationship changed after the implementation of a pro-c...Read more...

CEP discussion paper

Changing the structure of minimum wages: firm adjustment and wage spillovers

This paper analyses the economic impact of a significant change to the structure of a minimum wage setting policy. The context is the United Kingdom where government mandated an unexpected change in the structure of mini...Read more...

SERC/Urban and Spatial Programme Discussion Paper

One or Many Cohesion Policies of the European Union? On the Diverging Impacts of Cohesion Policy across Member States

Do regions in all Member States (MSs) of the European Union (EU) benefit from Cohesion Policy? Are regional impacts persistently diversified across countries? In order to answer these questions this paper explores how th...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Impact of Public Employment: Evidence from Bonn

This paper evaluates the impact of public employment on private sector activity using the relocation of the German federal government from Berlin to Bonn in the wake of the Second World War as a source of exogenous varia...Read more...

Journal article

Journal of Labor Economics:

Minimum wages and firm value

How does the value of a firm change in response to a minimum wage hike? The evidence we have to date is not well-suited to answer this question, principally because events that have been studied are not completely unknow...Read more...

Journal article

Journal of Economic Perspectives:

The economic consequences of family policies: lessons from a century of legislation in high-income countries

By the early 21st century, most high-income countries have put into effect a host of generous and virtually gender-neutral parental leave policies and family benefits, with the multiple goals of gender equity, higher fer...Read more...

CEP discussion paper

Tax simplicity and heterogeneous learning

We study the effects of fiscal incentives for self-employment using new French tax data from 1994 to 2012. France serves as a good quasi-laboratory: It has three fiscal regimes - or modes of taxation - for the self-emplo...Read more...

CentrePiece article

Happiness at work

Work-life balance is a particularly strong predictor of people’s happiness. High degrees of job satisfaction can hide low levels of engagement at work. Happiness helps to shape job market outcomes, productivity and firm ...Read more...

CEP discussion paper

Risk-based selection in unemployment insurance: evidence and implications

This paper studies whether adverse selection can rationalize a universal mandate for unemployment insurance (UI). Building on a unique feature of the unemployment policy in Sweden, where workers can opt for supplemental ...Read more...

Journal article

American Economic Journal: Macroeconomics:

Gender gaps and the rise of the service economy

This paper investigates the role of the rise in services in the narrowing of gender gaps in hours and wages in recent decades. We highlight the between-industry component of differential gender trends for the United Stat...Read more...

Journal article

American Economic Review:

How Local Are Labor Markets? Evidence from a Spatial Job Search Model

This paper models the optimal search strategies of the unemployed across space to characterize local labor markets. Our methodology allows for linkages between numerous areas, while preserving tractability. We estimate t...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Local Economic Impacts of Regeneration Projects: Evidence from UK's Single Regeneration Budget

We study the local economic impacts of a major regeneration programme aimed at enhancing the quality of life of local people in deprived neighbourhoods in the UK. The analysis is based on a panel of firm and area level d...Read more...

CentrePiece article

In brief...Road to recovery? Economic benefits of new infrastructure

New investment in roads can produce economic benefits, even in mature infrastructure networks like the UK’s, according to research by Henry Overman and colleagues. At the same time, they argue, improved evaluation of new...Read more...

CentrePiece article

Economics of a good night's sleep

Parents whose sleep quality is reduced by young children waking them in the night are less likely to work, work shorter hours and/or earn less than otherwise similar people who enjoy a good night’s sleep. The negative la...Read more...

SERC/Urban and Spatial Programme Discussion Paper

New Road Infrastructure: The Effects on Firms

This paper estimates the impact of new road infrastructure on employment and labour productivity using plant level longitudinal data for Britain. Exposure to transport improvements is measured through changes in accessib...Read more...

Journal article

American Economic Review:

Is modern technology responsible for jobless recoveries?

Since the early 1990s, recoveries from recessions in the US have been plagued by weak employment growth. We investigate whether a similar problem afflicts other developed economies, and whether technology is a culprit. W...Read more...

CEP discussion paper

Happiness at work

Happiness is typically defined by how people experience and evaluate their lives as a whole. Since the majority of people spend much of their lives at work, it is critically important to gain a solid understanding of the...Read more...

CEP discussion paper

Parental sleep and employment: evidence from a British cohort study

We show that sleep deprivation exerts a strong negative effect on labour market performance. We exploit variations in child sleep quality to instrument for parental sleep quality. A one-hour reduction in sleep duration s...Read more...

CVER Research Paper

Vocational vs. General Education and Employment over the Life-Cycle: New Evidence from PIAAC

It has been argued that vocational education facilitates the school-to-work transition but reduces later adaptability to changing environments. Using the recent international PIAAC data, we confirm such a trade-off over ...Read more...

CEP discussion paper

Aggregate recruiting intensity

We develop a model of firm dynamics with random search in the labor market where hiring firms exert recruiting effort by spending resources to fill vacancies faster. Consistent with micro evidence, in the model fast-grow...Read more...

Journal article

Annual Review of Economics:

The evolution of gender gaps in industrialized countries

Women in developed economies have made major advancements in labor markets throughout the past century, but remaining gender differences in pay and employment seem remarkably persistent. This article documents long-run t...Read more...

CentrePiece article

China shock: the impact on trade and incomes

Is US presidential candidate Donald Trump right when he claims that the Chinese are causing serious damage to American workers? Research by João Paulo Pessoa analyses the impact of the recent massive increase in China’s ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Location, Search Costs and Youth Unemployment: Experimental Evidence from Transport Subsidies in Addis Ababa

Do high search costs affect the labour market outcomes of job seekers living far away from jobs? I randomly assign transport subsidies to unemployed youth in urban Ethiopia. Treated respondents increase job search intens...Read more...

CEP Brexit analysis

Brexit and the impact of immigration on the UK

A reduction in immigration from the European Union (EU) following a vote for Brexit would not lead to any improvement in living standards for those born in the UK. Cuts in EU immigration would not offset the big fall in ...Read more...

CEP discussion paper

The elusive employment effect of the minimum wage

There is a huge body of empirical research on the employment effect of the minimum wage that has failed to clearly demonstrate the negative effect that so many economists strongly believe to find. This paper reviews the ...Read more...

CEP discussion paper

Rethinking deindustrialization

Manufacturing in high-income countries is on the decline and Denmark is no exception. Manufacturing employment and the number of firms have been shrinking as a share of the total and in absolute levels. This paper uses a...Read more...

CEP discussion paper

International competition and labor market adjustment

How does welfare change in the short- and long-run in high wage countries when integrating with low wage economies like China? Even if consumers benefit from lower prices, there can be significant welfare losses from inc...Read more...

CEP discussion paper

The evolution of gender gaps in industrialized countries

Women in developed economies have made major inroads in labor markets throughout the past century, but remaining gender differences in pay and employment seem remarkably persistent. This paper documents long-run trends i...Read more...

CentrePiece article

Misery and mental health

Mental illness is a far bigger source of human misery than poverty or unemployment, according to research by Sarah Flèche and Richard Layard. They argue that we need to move beyond a purely materialistic conception of mi...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The (Displacement) Effects of Spatially Targeted Enterprise Initiatives: Evidence from UK LEGI

We investigate the impacts of a significant area-based intervention (LEGI) that aimed to increase employment and entrepreneurial activity in 30 disadvantaged areas across England. We examine the spatial pattern of effect...Read more...

CEP real wages update

Slowing UK Wage Growth

We have previously examined the path of nominal and real wages in the UK (Blanchflower and Machin, 2014a, 2014b, 2014c). In that work, we expressed the view that in recent years there has been sufficient slack in the lab...Read more...

Journal article

The Review of Economic Studies:

Trade induced technical change? The impact of Chinese imports on innovation, IT and productivity

We examine the impact of Chinese import competition on broad measures of technical change - patenting, IT, and TFP - using new panel data across twelve European countries from 1996 to 2007. In particular, we establish th...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Trade and Frictional Unemployment in the Global Economy

We develop a multi-country, multi-sector trade model with labor market frictions and equilibrium unemployment. Trade opening leads to a reduction in unemployment if it raises real wages and reallocates labor towards sect...Read more...

CEP discussion paper

The persistence of a banking crisis

This paper analyses the effects of bank lending on GDP and employment. Following losses on international financial markets in 2008/09, a large German bank cut its lending to the German economy. I exploit variation in dep...Read more...

CEP discussion paper

Short and long-term effects of unemployment on fertility

Scholars have been examining the relationship between fertility and unemployment for more than a century. Most studies find that fertility falls with unemployment in the short run, but it is not known whether these negat...Read more...

CEP discussion paper

Commuting, migration and local employment elasticities

Many changes in the economic environment are local, including policy changes and infrastructure investments. The effect of these changes depends crucially on the ability of factors to move in response. Therefore a key ob...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Spatial Decay in Commuting Probabilities: Employment Potential vs. Commuting Gravity

We show that an employment potential capitalisation model, which establishes a spatial relationship between the price of land and the spatial distribution of employment through a transport matrix, produces estimates of t...Read more...

CEP discussion paper

Early maternal employment and non-cognitive outcomes in early childhood and adolescence: evidence from British birth cohort data

We analyse the relationship between early maternal employment and child emotional and behavioural outcomes in early childhood and adolescence. Using rich data from a cohort of children born in the UK in the early 1990s, ...Read more...

CentrePiece article

Crime scars: can recessions produce career criminals?

Recessions typically raise youth unemployment and leave longterm labour market ‘scars’ on the young people concerned. Research by Brian Bell, Anna Bindler and Stephen Machin finds that they also have a disturbing and sub...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Big Plant Closures and Agglomeration Economies

This paper analyses the effects of large manufacturing plant closures on local employment. Specifically, we estimate the net employment effects of the closure of 45 large manufacturing plants in Spain, which relocated ab...Read more...

CEP discussion paper

The optimal timing of UI benefits: theory and evidence from Sweden

This paper provides a simple, yet general framework to analyze the optimal time profile of benefits during the unemployment spell. We derive simple sufficient-statistics formulae capturing the insurance value and incenti...Read more...

CEP discussion paper

The persistence of local joblessness

Local differences in US employment-population ratios and unemployment rates have persisted over many decades. Using decennial census data from 1950-2010, we investigate the reasons for this. The persistence cannot be exp...Read more...

CEP discussion paper

Do more of those in misery suffer from poverty, unemployment or mental illness?

Studies of deprivation usually ignore mental illness. This paper uses household panel data from the USA, Australia, Britain and Germany to broaden the analysis. We ask first how many of those in the lowest levels of life...Read more...

CEP election analysis

#ElectionEconomics: The Research Evidence on Key Issues for Voters in the 2015 UK General Election

Please see the CEP #ElectionEconomics report(Paper 1)and the Executive Summary (Paper 2) that cover all the election 2015 briefings, discussing the research evidence on 15 of the UK's key policy battlegrounds: immigratio...Read more...

CEP discussion paper

Can helping the sick hurt the able? Incentives, information and disruption in a welfare reform

Disability rolls have escalated in developed nations over the last 40 years. The UK stands out because the numbers on these benefits stopped rising when a welfare reform (“Jobcentre Plus”) was introduced that integrated ...Read more...

CEP election analysis

Gender Gaps in the UK Labour Market: jobs, pay and family-friendly policies

Differences in the labour market experiences of men and women have fallen over the last 20 years, but there are still sizeable ‘gender gaps’ in employment and wages. Certain factors help to explain a good part of gender ...Read more...

CEP election analysis

Real Wages and Living Standards

Real wages and living standards have taken a hard hit in the UK in the recent past. Real wages of the typical (median) UK worker have fallen by almost 10% since 2008 and median family incomes have significantly fallen fo...Read more...

CEP discussion paper

The impact of immigration on the local labor market outcomes of blue collar workers: panel data evidence

Using a large administrative French panel data set for 1976-2007, we examine how low- educated immigration affects the wages, employment, occupations and locations of blue-collar native workers. The natives in the sample...Read more...

CEP discussion paper

Voting behaviour and public employment in Nazi Germany

This paper analyses whether the German National Socialists used economic policies to reward their voters after their rise to power in 1933. Using data on public employment in the armed forces, public administrations and ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Employment and Technological Change: On the Geography of Labour Market Adjustments

This paper investigates the impact of technological change on local labour market outcomes in Britain. Using a newly assembled panel database for the period 2000-2007 and a directly observed measure of technological chan...Read more...

Journal article

American Economic Review:

Industry compensation under relocation risk: a firm-level analysis of the EU emissions trading scheme

When regulated firms are offered compensation to prevent them from relocating, efficiency requires that payments be distributed across firms so as to equalize marginal relocation probabilities, weighted by the damage cau...Read more...

CEP discussion paper

Crime Scars: Recessions and the Making of Career Criminals

Recessions lead to short-term job loss, lower levels of happiness and decreasing income levels. There is growing evidence that workers who first join the labour market during economic downturns suffer from poor job match...Read more...

CEP discussion paper

Biomarkers and Long-term Market Outcomes: The Case of Creatine

Using the Young Finns Study (YFS) combined with the Finnish Linked Employer-Employee Data (FLEED) we show that quantities of creatine measured in 1980 prior to labour market entry affect labour market outcomes over the p...Read more...

CEP occasional paper

Dynemp: A Stata® Routine for Distributed Micro-data Analysis of Business Dynamics

This paper introduces a new Stata® command, dynemp, which implements a distributed micro-data analysis of business and employment dynamics and firm demographics. The data source it requires are business registers or comp...Read more...

CEP discussion paper

The Dynamics of Employment Growth: New Evidence from 18 Countries

Motivated by the on-going interest of policy makers in the sources of job creation, this paper presents results from a new OECD project on the dynamics of employment (DynEmp) based on an innovative methodology using firm...Read more...

CEP discussion paper

Winners and Losers from a Commodities-for-Manufactures Trade Boom

A recent boom in commodities-for-manufactures trade between China and other developing countries has led to much concern about the losers from rising import competition in manufacturing, but little attention on the winne...Read more...

Blog

LSE American Politics and Policy Blog:

Firms with more structured management practices are more productive, innovative and have faster employment growth.

In 2010, the US Census Bureau conducted the first large-scale survey of management practices in America, gathering data on more than 30,000 manufacturing plants. Nicholas Bloom and colleagues find strong links between es...Read more...

CentrePiece article

Falling real wages

The researchers note that there have been historically unprecedented falls in UK real wages since the start of the Great Recession. What’s more, the long US experience of stagnant real wages (median real weekly earnings ...Read more...

CentrePiece article

Minimum wages: the economics and the politics

The UK’s national minimum wage has tackled extreme low pay – but the wider problem of low pay remains as serious as ever. That is one of the conclusions of Professor Alan Manning in a discussion of the growing popularity...Read more...

CEP discussion paper

The Impact of Mandatory Entitlement to Paid Leave on Employment in the UK

I evaluate the impact of the UK Working Time Regulations 1998, which introduced mandatory paid holiday entitlement. The regulation gave (nearly) all workers the right to a minimum of 4 weeks of paid holiday per a year. W...Read more...

CentrePiece article

Tackling long-term unemployment

Barbara Petrongolo surveys the research evidence on the effectiveness of the 'sticks' and 'carrots' of active labour market policies....Read more...

CentrePiece article

Unemployment and domestic violence

Contrary to popular belief, the incidence of domestic violence in Britain does not seem to have risen during the recession. But according to research by Jonathan Wadsworth and colleagues, men and women have experienced d...Read more...

Blog

LSE European Politics and Policy Blog:

The state of the UK economy: Diagnosis, prognosis and recommended treatment

The UK economy has experienced a prolonged period of weakness over the last five years. John Van Reenen writes that the real problems for the UK are inadequate long-run investment in infrastructure, innovation and human ...Read more...

CentrePiece article

In brief...'Smart and illicit': the making of a successful entrepreneur

Smart teenagers who engage in illicit activities are much more likely to become entrepreneurs, according to research by Ross Levine and Yona Rubinstein. But, they note, being self-employed doesn’t necessarily make someon...Read more...

CEP discussion paper

Smart and Illicit: Who Becomes an Entrepreneur and Does it Pay?

We disaggregate the self-employed into incorporated and unincorporated to distinguish between “entrepreneurs” and other business owners. The incorporated self-employed have a distinct combination of cognitive, noncogniti...Read more...

CEP discussion paper

The Objective Benefits of Subjective Well-Being

The aim of this paper is to survey the 'hard' evidence on the effects of subjective well-being. In doing so, we complement the evidence on the determinants of well-being by showing that human well-being also affects outc...Read more...

Journal article

American Economic Review:

Immigration, offshoring, and American jobs

Following Grossman and Rossi-Hansberg (2008) we present a model in which tasks of varying complexity are matched to workers of varying skill in order to develop and test predictions regarding the effects of immigration a...Read more...

CEP discussion paper

A Model of Aggregate Demand and Unemployment

We present a static model of aggregate demand and unemployment. The economy has a nonproduced good, a produced good, and labor. Product and labor markets have matching frictions. A general equilibrium is a set of prices,...Read more...

CEP discussion paper

A General Method for Valuing Non-Market Goods Using Wellbeing Data: Three-Stage Wellbeing Valuation

Subjective wellbeing data is becoming increasingly popular in economics research. The wellbeing valuation approach uses wellbeing data instead of data gleaned from preferences to attach monetary values to non-market good...Read more...

CEP discussion paper

Unemployment and Domestic Violence: Theory and Evidence

Is unemployment the overwhelming determinant of domestic violence that many commentators expect it to be? The contribution of this paper is to examine, theoretically and empirically, how changes in unemployment affect th...Read more...

Journal article

Economica:

Unemployment in the Great Recession

This paper studies the responses of unemployment in Germany, the USA and the UK to the Great Recession of 2008-9 using Beveridge curve analysis, and in the entire OECD using other techniques. It is shown that the UK suff...Read more...

CentrePiece article

In brief: The long reach of childhood bullying

Does the fear of being bullied in childhood affect people's resilience to adverse life events they may face in adulthood? The author investigates whether the 'scarring' effects are particularly damaging to individuals wh...Read more...

CEP report

The UK productivity and jobs puzzle: does the answer lie in labour market flexibility?

GDP per worker fell for the five years after 2008 which is unprecedented in post war UK history. In this paper we argue that “capital shallowing” (i.e. the fall in the capital-labour ratio) could be the main reason for t...Read more...

CEP discussion paper

Mental Health: The New Frontier for Labour Economics

This lecture argues that mental health is a major factor of production. It is the biggest single influence on life satisfaction, with mental health eight years earlier a more powerful explanatory factor than current inco...Read more...

CEP discussion paper

Unemployment in the Great Recession

This paper studies the responses of unemployment in Germany, the United States and Britain to the Great Recession of 2008-09 by making use of Beveridge curve analysis, and in the entire OECD with other techniques. It is ...Read more...

CEP US election analysis

Inequality and opportunity: the return of a neglected debate

During this election period many Americans are feeling angry towards the very rich, especially those working in the financial sector, who helped cause the Great Recession and yet were bailed out by the government. Increa...Read more...

CEP discussion paper

Resilience to Economic Shocks and the Long Reach of Childhood Bullying

This paper investigates whether people’s ability to withstand and adapt to one of the most important economic shocks – job loss – is determined early on in childhood. Using nationally representative longitudinal data tha...Read more...

CEP US election analysis

Recession and Recovery: The US Policy Debate on Taxes, Spending and Public Debt

The US economy is still suffering from its most severe recession in seven decades. In the first of a series of US Election Analyses, Ethan Ilzetzki covers the key issue of taxes, spending and public debt, a major point o...Read more...

CEP discussion paper

The Transferable Scars: A Longitudinal Evidence of Psychological Impact of Past Parental Unemployment on Adolescents in the United Kingdom

Using a longitudinal data of British youths, this paper explores the consequences of past parental unemployment on the current happiness and self-esteem of the children. We find that a past unemployment spell of the fath...Read more...

SERC/Urban and Spatial Programme Discussion Paper

New Road Infrastructure: the Effects on Firms

This paper estimates the impact of road improvements on firm employment and productivity using plant level longitudinal data for Britain. Exposure to transport improvements is measured by changes in employment accessibil...Read more...

CEP report

Fiscal consolidation during a depression

In 2009-10, the UK's budget deficit was about 11 per cent of GDP. A credible plan for fiscal consolidation was introduced in the UK over the fiscal years 2011-12 to 2016-17. In this paper, we assess the impact of the sca...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Effect of Public Sector Employment on Local Labour Markets

This paper considers the impact of public sector employment on local labour markets. Using English data at the Local Authority level for 2003 to 2007 we find that public sector employment has no identifiable effect on to...Read more...

CEP discussion paper

Immigration, Offshoring and American Jobs

How do offshoring and immigration affect the employment of native workers? What kinds of jobs suffer, or benefit, most from the competition created by offshore and immigrant workers? In contrast to the existing literatur...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Does Self-Employment Measure Entrepreneurship? Evidence from Great Britain

Research on entrepreneurship often uses information on self-employment to proxy for business creation and innovative behaviour. However, little evidence has been collected on the link between these measures. In this pape...Read more...

CentrePiece article

In brief: Can industrial policy boost jobs?

Business support policies designed to raise productivity and employment are common worldwide, but rigorous micro-econometric evaluation of their causal effects is rare. We exploit multiple changes in the area-specific el...Read more...

CentrePiece article

Jobs in a recession

This article is based on a paper that models unemployment as the result of matching frictions and job rationing. Job rationing is a shortage of jobs arising naturally in an economic equilibrium from the combination of so...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Accounting for Big City Growth in Low Paid Occupations: Immigration and/or Service Class Consumption

Growth of 'global cities' in the 1980s was supposed to have involved an occupational polarisation, including growth of low paid service jobs. Though held to be untrue for European cities, at the time, some such growth di...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Great Britain's Second-Order City Regions in Recessions, 1978-2010

While it is now accepted that the 2008-09 recession accentuated regional differences in Britain, it is more difficult to identify the role of major cities, especially over a longer time scale. Using previously establishe...Read more...

CEP discussion paper

Preferential Trade Agreements and the Labor Market

Labor market consequences are at the forefront of most debates on the merits of trade liberalization. Preferential trade agreements (PTAs) have become the primary form of trade liberalization in most countries, and sever...Read more...

CEP discussion paper

Fiscal Multipliers over the Business Cycle

This paper illustrates why fiscal policy becomes more effective as unemployment rises in recessions. The theory is based on the equilibrium unemployment model of Michaillat (forthcoming), in which jobs are rationed in re...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Flexible Employment and Cross-Regional Adjustment

Employment flexibility is commonly associated to greater labour mobility and thus faster cross-regional adjustments. The literature however offers very little hard evidence on this and quite limited theoretical guidance....Read more...

CEP discussion paper

Some Causal Effects of an Industrial Policy

Business support policies designed to raise employment and productivity are ubiquitous around the world. We exploit changes in the area-specific eligibility criteria for a major program to support manufacturing jobs thro...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Causal Effects of an Industrial Policy

Business support policies designed to raise productivity and employment are common worldwide, but rigorous micro-econometric evaluation of their causal effects is rare. We exploit multiple changes in the area-specific el...Read more...

CEP policy analysis

Apprenticeship Policy in England: Increasing Skills versus Boosting Young People's Job Prospects

Successive British governments have committed substantial public resources to apprentice training, but far too few young people benefit and not enough high value skills have been developed. That is the central conclusion...Read more...

CentrePiece article

Young People Without Qualifications: How 'Headline Numbers' Shape Policy and Aspiration

England's most widely used indicator of young people's education and labour market status is the NEET category - 'not in education, employment or training'. Making comparisons with how France and Germany measure school l...Read more...

Journal article

Journal of the European Economic Association:

Rethinking the effect of immigration on wages

This paper calculates the effects of immigration on the wages of native US workers of various skill levels in two steps. In the first step we use labor demand functions to estimate the elasticity of substitution across d...Read more...

CEP discussion paper

Optimal Unemployment Insurance Over the Business Cycle

This paper characterizes optimal unemployment insurance (UI) over the business cycle using a model of equilibrium unemployment in which jobs are rationed in recession. It offers a simple optimal UI formula that can be ap...Read more...

CEP discussion paper

The Role of Worker Flows in the Dynamics and Distribution of UK Unemployment

Unemployment varies substantially over time and across subgroups of the labour market. Worker flows among labour market states act as key determinants of this variation. We examine how the structure of unemployment acros...Read more...

CentrePiece article

Youth unemployment

The rise in joblessness among young people began long before the recession - Barbara Petrongolo and John Van Reenen consider potential explanations....Read more...

Book

Combatting Unemployment
IZA Prize in Labor Economics

Combatting Unemployment is a collection of key papers from seminal labour economists Richard Layard and Stephen J. Nickell. The authors received the IZA Prize in Labor Economics in 2008 for their path-breaking wor...Read more...

Book

The Labour Market in Winter
The State of Working Britain

This collection of essays - by leading economic experts on the UK labour market - provides an overview of the key issues concerning the performance of the labour market, and the policy issues surrounding it, with a f...Read more...

CEP discussion paper

Trade induced technical change? The impact of Chinese imports on innovation, IT and productivity

We examine the impact of Chinese import competition on broad measures of technical change - patenting, IT, R&D, TFP and management practices – using new panel data across twelve European countries between 1996-2007. We c...Read more...

CEP discussion paper

The Evolution of the Modern Worker: Attitudes to Work

This paper examines how employees’ experiences of, and attitudes towards, work have changed over the last quarter of a century. It assesses the extent to which any developments relate to the economic cycle and to trends ...Read more...

CEP discussion paper

Trade and Labor Market Outcomes

This paper reviews a new framework for analyzing the interrelationship between inequality, unemployment, labor market frictions, and foreign trade. This framework emphasizes firm heterogeneity and search and matching fri...Read more...

CEP discussion paper

Do Matching Frictions Explain Unemployment? Not in Bad Times

This paper models unemployment as the result of matching frictions and job rationing. Job rationing is a shortage of jobs arising naturally in an economic equilibrium from the combination of some wage rigidity and dimini...Read more...

CEP discussion paper

Employment, Inequality and the UK National Minimum Wage over the Medium-Term

This paper assesses the impact of the National Minimum Wage (NMW) on employment and inequality in the UK over the decade since its introduction in 1999. Identification is facilitated by using variation in the bite of the...Read more...

Blog

LSE British Politics and Policy:

To avoid creating a ‘lost generation’, with perhaps a fifth of all 18 year olds unemployed and outside training, a new push on apprenticeships would help

With record numbers of young people not gaining university places, the viability of apprenticeships could make a huge difference in preventing a ‘lost generation’ out of touch with the labour market. Dr Hilary Steedman o...Read more...

CentrePiece article

Jobs in the recession

The recession of 2008-09 inflicted a larger cumulative loss of UK output than any of the previous post-war recessions, yet there has been a relatively low loss of employment, at least so far. Paul Gregg and Jonathan Wads...Read more...

CEP occasional paper

The UK Labour Market and the 2008 - 2009 Recession

The recession of 2008-2009 inflicted a larger cumulative loss of UK output than any of the other post-war recessions. Nevertheless, employment rates remained higher than might have been expected given the experience of p...Read more...

CEP election analysis

CEP Election Analysis 2010 - The complete Series, discussing research on some of the key policy battlegrounds of the 2010 General Election

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CEP election analysis

Jobs and Youth Unemployment: It's bad, but not as bad as you might think

Read more...

SERC/Urban and Spatial Programme Discussion Paper

Local Human Capital and Its Impact on Local Employment Chances in Britain

This paper examines how high human capital in a locality is associated with the employment outcomes of individuals. A probit model is used to examine how the employment probability of otherwise similar working age males ...Read more...

Journal article

Journal of Public Economics:

The long-term effects of job search requirements: Evidence from the UK JSA reform

This paper investigates long-term returns from unemployment compensation, exploiting variation from the UK JSA reform of 1996, which implied a major increase in job search requirements for eligibility and in the related ...Read more...

CEP discussion paper

Welfare Policy and the Distribution of Hours of Work

We examine the distribution of hours of work across industrial sectors in OECD countries. We find large disparities when sectors are divided into three groups: one that produces goods without home substitutes and two oth...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Fluctuating Record of Economic Regeneration in England's Second-Order City Regions, 1984-2007

This study examines how far and in what way ‘Our cities are back’, as claimed by England’s Core Cities Group. It focuses on 1984-2007 employment changes for the eight Core Cities and their city regions: Birmingham, Brist...Read more...

CEP discussion paper

The Economic Situation of First- and Second-Generation Immigrants in France, Germany and the United Kingdom

A central concern about immigration is the integration into the labour market, not only of the first generation, but also of subsequent generations. Little comparative work exists for Europe’s largest economies. France, ...Read more...

CEP discussion paper

Inequality and Unemployment in a Global Economy

This paper develops a new framework for examining the distributional consequences of international trade that incorporates firm and worker heterogeneity, search and matching frictions in the labor market, and screening o...Read more...

CEP discussion paper

Unemployment Insurance and Cultural Transmission: Theory and Application to European Unemployment

This paper emphasizes the two-way causality between the provision of unemployment insurance and the cultural transmission of work ethic. Values affect the size of the moral-hazard problem and, hence, the policy to be imp...Read more...

CEP discussion paper

The Macroeconomic Role of Unemployment Compensation

The standard motivation for unemployment compensation is consumption smoothing and most papers in the literature have analyzed trade-offs involving consumption smoothing and moral hazard. This paper shows how such policy...Read more...

CEP discussion paper

Trading Places: Employers, Unions and the Manufacture of Voice

Using nationally representative workplace data for Britain we show that over the last quarter century union voice – especially union-only voice – has been associated with poorer climate, more industrial action, poorer fi...Read more...

CEP discussion paper

Resurrecting the Participation Margin

This paper considers a real business cycle model with search frictions in the labor market and labor supply which is elastic along the participation margin. Previous authors have found that such models generate counterfa...Read more...

CEP discussion paper

A Tale of Two Countries: Unions, Closures and Growth in Britain and Norway

Using linked private sector employer-employee panel data for Britain and Norway we explore the effects of unionization on workplace closure and employment growth over the period 1997-2004. Unions prolonged the life of lo...Read more...

CEP discussion paper

Union Decline in Britain

This paper investigates the demise of unionisation in British private sector workplaces over the last quarter century. We show that dramatic union decline has occurred across all types of workplace. Although the union wa...Read more...

CEP discussion paper

Private Sector Employment Growth, 1998-2004: A Panel Analysis of British Workplaces

Using nationally representative panel data for British private sector workplaces this paper points to the importance of distinguishing between workplace and firm size when analysing employment growth, and finds that the ...Read more...

Journal article

The Economic Journal:

The part-time pay penalty for women in Britain

Women in Britain who work part-time have, on average, hourly earnings about 25% less than that of women working full-time. This gap has widened greatly over the past 30 years. This article tries to explain this part-time...Read more...

CEP discussion paper

Employment Outcomes in the Welfare State

We examine the implications of tax and subsidy policies for employment in the 'three worlds of welfare', Anglo-Saxon, Continental European and Scandinavian. We argue that home production is key to a proper evaluation of ...Read more...

CEP discussion paper

The Ins and Outs of European Unemployment

In this paper we study the contribution of inflows and outflows to the dynamics of unemployment in three European countries, the United Kingdom, France and Spain. We compare performance in these three countries making us...Read more...

CEP discussion paper

On the Extent of Re-Entitlement Effects in Unemployment Compensation

A dynamic labor matching economy is presented, in which the unemployed are either entitled to unemployment insurance (UI) or unemployment assistance (UA), and the employees are either eligible for UI or UA upon future se...Read more...

CEP discussion paper

Labor Market Institutions Around the World

This paper documents the large cross-country differences in labor institutions that make them a candidate explanatory factor for the divergent economic performance of countries and reviews what economists have learned ab...Read more...

CEP discussion paper

What Are the Long-Term Effects of UI? Evidence from the UK JSA Reform

This paper investigates long-term returns from unemployment compensation, exploiting variation from the UK JSA reform of 1996, which implied a major increase in job search requirements for eligibility and in the related ...Read more...

CEP discussion paper

The Unemployment Volatility Puzzle: Is Wage Stickiness the Answer?

I study the cyclical behavior of an equilibrium search model with endogenous job creation and destruction, with focus on the model’s failure to match the observed cyclical volatility of unemployment. Job creation in the ...Read more...

CEP discussion paper

Creative Destruction with On-the-Job Search

This paper is about the labour market consequences of creative destruction with on-the-job search. We consider a matching model in an economy with embodied technological progress and show that its dynamics are profoundly...Read more...

CEP discussion paper

Incentives in Competitive Search Equilibrium

This paper analyses the interaction between internal agency problems within firms and external search frictions when workers have private information. We show that the allocation of resources is determined by a modified ...Read more...

CEP discussion paper

The Shimer Puzzle and the Correct Identification of Productivity Shocks

Shimer (2005a) claims that the Mortensen-Pissarides search model of unemployment lacks an ampiflication mechanism because it cannot generate the observed business cycle fluctuations in unemployment given labor productivi...Read more...

CEP discussion paper

Productivity, Aggregate Demand and Unemployment Fluctuations

This paper presents new empirical evidence on the cyclical behavior of US unemployment that poses a challenge to standard search and matching models. The correlation between cyclical unemployment and the cyclical compone...Read more...

CEP discussion paper

The Beveridge Curve

The Beveridge curve depicts a negative relationship between unemployed workers and job vacancies, a robust finding across countries. The position of the economy on the curve gives an idea as to the state of the labour ma...Read more...

CEP discussion paper

Job Destruction, Job Creation and Unemployment in Transition Countries: What Can We Learn?

Sixteen years into the transition, the problem of high joblessness has not been solved. Of the three explanations commonly discussed (i.e. ongoing reallocation; finished reallocation with redundant labour; wrong choice o...Read more...

CEP discussion paper

Does the Underground Economy Hold Back Financial Deepening? Evidence from the Italian Credit Market

The paper investigates the relationship between underground activities and financial deepening. The access to external finance requires entrepreneurs to disclose credible information through formal documentation. This re...Read more...

CEP discussion paper

Why Has the British National Minimum Wage Had Little or No Impact on Employment?

A century has passed since the first call for a British national minimum wage (NMW). That remarkable Fabian tract discussed wage setting, coverage, monopsony, international labour standards, inspection and compliance and...Read more...

Journal article

Review of Economics and Statistics:

Lousy and lovely jobs: the rising polarization of work in Britain

This paper shows that the United Kingdom since 1975 has exhibited a pattern of job polarization with rises in employment shares in the highest- and lowest-wage occupations. This is not entirely consistent with the idea o...Read more...

CEP discussion paper

Unemployment and Hours of Work: The North Atlantic Divide Revisited

I examine the dynamic evolutions of unemployment, hours of work and the service share since the war in the United States and Europe. The theoretical model brings together all three and emphasizes technological growth. Co...Read more...

CEP discussion paper

Individual Employee Voice: Renegotiation and Performance Management in Public Services

Periodically, the ‘zone of acceptance’ within which management may use its authority to direct employees’ work needs to be adapted to the changing needs of organisations. This article focuses especially on the non-codifi...Read more...

CEP discussion paper

What Voice Do British Workers Want?

The problems/need for representation and participation reported by workers vary across workplaces and by types of jobs. Workers with greater workplace needs are more desirous of unions but their preferences are fine-grai...Read more...

CEP discussion paper

Patterns of Work Across the OECD

Market work per person of working age differs widely across the OECD countries and there have been some significant changes in the last forty years. How to explain this pattern? Taxes are part of the story but much remai...Read more...

Book

Unemployment: Macroeconomic Performance and the Labour Market

This book aims to provide a basis for better unemployment policy: showing how the lessons learned from experience and theory can be applied to greatly reduce the waste and misery of high unemployment. The book survey...Read more...

CEP discussion paper

You Can't Always Get What You Want: the Impact of the Jobseeker's Allowance

In 1996 the UK made major changes to its welfare system for the support of the unemployed with the introduction of the Jobseeker’s Allowance. This tightened the work search requirements needed for eligibility for benefit...Read more...

CEP discussion paper

The Employment Effects of the October 2003 Increase in the National Minimum Wage

There is a growing body of research that measures employment effects of the minimum wage by using longitudinal data on individuals to compare job loss of workers affected by a minimum wage increase with those who are not...Read more...

CEP discussion paper

New Survey Evidence on Recent Changes in UK Union Recognition

This paper reports results from a recent survey we conducted on the union status of over 650 firms in the private sector of the UK. Compared to earlier periods, the survey shows that since 1997 there has been a slight fa...Read more...

CEP discussion paper

Capital Mobility and Unemployment Dynamics: Evidence from a Panel of OECD Countries

We use a panel of 20 OECD countries over a 30-year period to estimate the implications of international capital mobility for unemployment. We find that the increase in capital flows since the mid1980s has contributed to ...Read more...

CEP discussion paper

The Part-Time Pay Penalty

In 2003, women working part-time in the UK earned, on average, 22% less than women working full-time. Compared to women who work FT, PT women are more likely to have low levels of education, to be in a couple, to have yo...Read more...

CEP discussion paper

Job Security and Job Protection

We construct indicators of the perception of job security for various types of jobs in 12 European countries using individual data from the European Community Household Panel (ECHP). We then consider the relation between...Read more...

CEP discussion paper

Productivity Growth and Employment: Theory and Panel Estimates

Theoretical predictions of the effect of TFP growth on employment are ambiguous, and depend on the extent to which new technology is embodied in new jobs. We estimate a model for employment, wages and investment with an ...Read more...

Chapter

Mobility and Joblessness

in Seeking A Premier Economy: The Economic Effects Of British Economic Reforms, 1980-2000

The perceived impact of location on economic opportunity has been a constant refrain in discussions of the economic performance of the United Kingdom for as long as anyone can remember and the source of much feeling th...Read more...

Journal article

Journal of the European Economic Association:

Evaluating the employment impact of a mandatory job search program

This paper exploits area-based piloting and age-related eligibility rules to identify treatment effects of a labor market program-the New Deal for Young People in the U.K. A central focus is on substitution/displacement ...Read more...

CEP discussion paper

Gender Segregation in Employment Contracts

This paper presents evidence on gender segregation in employment contracts in 15 EU countries, using micro data from the ECHPS. Women are over-represented in part-time jobs in all countries considered, but while in north...Read more...

CEP discussion paper

Employment and Taxes

This paper considers the impact of taxation policy on market work. On the basis of the evidence, we find that a 10 percentage point rise in the tax wedge will reduce overall labour input provided via the market by around...Read more...

CEP discussion paper

Threshold Effects and Firm Size: the Case of Firing Costs

We study the role of employment protection legislation (EPL) in determining firm size distribution. In many countries the provisions of EPL are more stringent for firms above certain size thresholds. We construct a simpl...Read more...

CEP discussion paper

Short Job Tenures and Firing Taxes in the Search Theory of Unemployment

This paper studies the effects of firing taxes on the job destruction rate, when probation period - or temporary contract - policies are implemented in an otherwise exogenous job separation search model. It is shown that...Read more...

CEP discussion paper

The Impact of Vocational Qualifications on the Labour Market Outcomes of Low-Achieving School-Leavers

This paper creates a pseudo cohort of individuals who left school in the mid-1990s, using Labour Force Survey. The extent of low achievement at school amongst this group is documented, and then the impact of such low ach...Read more...

CEP discussion paper

Public Enterprises and Labor Market Performance

This paper shows that state control of some industries may have contributed to the increase in European unemployment from the 1970s to the early 1990s. We develop a simple model with both publicly-run and privately-run e...Read more...

CEP discussion paper

Gender Gaps in Unemployment Rates in OECD Countries

There is an enormous literature on gender gaps in pay and labour market participation but virtually no literature on gender gaps in unemployment rates. Although there are some countries in which there is essentially no g...Read more...

CEP discussion paper

Unemployment in Britain: A European Success Story

Unemployment in Britain has fallen from high European-style levels to US levels. I argue that the key reasons are first the reform of monetary policy, in 1993 with the adoption of inflation targeting and in 1997 with the...Read more...

CEP discussion paper

The Employment of Married Mothers in Great Britain: 1974-2000

This paper analyses the increase in mothers¿ employment in Britain over the period 1974¿2000. The approach consists of isolating those birth cohorts whose mothers experienced significant increases in employment and relat...Read more...

CEP discussion paper

Falling Trade Costs, Heterogeneous Firms and Industry Dynamics

This paper examines the response of industries and firms to changes in trade costs. Several new firm-level models of international trade with heterogeneous firms predict that industry productivity will rise as trade cost...Read more...

CEP discussion paper

A Picture of European Unemployment: Success and Failure.

Average unemployment in Europe today is relatively high compared with OECD countries outside Europe. The majority of countries in Europe today have lower unemployment than any OECD country outside Europe, including the U...Read more...

CEP discussion paper

Scale Effects in Markets with Search

Reduced-form tests of scale effects in markets with search, run when aggregate matching functions are estimated, may miss important scale effects at the micro level, because of the reactions of job searchers. A semi-stru...Read more...

CEP discussion paper

A Test Between Unemployment Theories Using Matching Data

This paper tests whether aggregate matching is consistent with unemployment being mainly due to search frictions or due to job queues. Using U.K. data and correcting for temporal aggregation bias, estimates of the random...Read more...

CEP discussion paper

Employment After Motherhood: A European Comparison

There is theoretical evidence that economic and family policies have an important impact on mother's employment. The aim of this article is to study empirically the women's transitions from employment to non-employment...Read more...

Book

The Wage Curve

The Wage Curve casts doubt on some of the most important ideas in macroeconomics, labor economics, and regional economics. According to macroeconomic orthodoxy, there is a relationship between unemployment and the ra...Read more...

CEP discussion paper

Labour Market Performance and Start-Up Costs: OECD Evidence

This paper is intended to make a contribution to the empirical literature explaining the rise of unemployment since the 1970s in western economies by means of interactions between shocks and institutions. The contributio...Read more...

CEP discussion paper

Employment Penalty After Motherhood In Spain

This paper investigates whether there exists an employment penalty from motherhood in Spain. In particular, we are interested in transitions from employment to non-employment and downward occupational mobility. Results s...Read more...

CEP discussion paper

Consumption and Savings with Unemployment Risk: Implications for Optimal Employment Contracts

This paper derives optimal employment contracts when workers are risk averse and there are employment and unemployment risks. Without income insurance, consumption rises during employment and falls during unemployment. O...Read more...

CEP discussion paper

Spanish Unemployment Persistence and the Ladder Effect

This paper aims to examine unemployment persistence in Spain by the soûcalled 'ladder' effect. This arises when highly-skilled workers who do not find a job matching their skills accept jobs which previously were occup...Read more...

CEP discussion paper

Company Start-Up Costs and Employment

I study the role of company start-up costs for employment performance. The model is search equilibrium with a new concept for firms. Agents have an innate managerial ability and make a career choice to become either mana...Read more...

CEP discussion paper

The Beveridge Curve, Unemployment and Wages in the OECD from the 1960s to the 1990s - Preliminary Version

This paper is an empirical analysis of unemployment patterns in the OECD countries from the 1960s to the 1990s, looking at the Beveridge Curves, real wages as well as unemployment directly. Our results indicate the follo...Read more...

CEP discussion paper

Externalities in the Matching of Workers and Firms in Britain

We provide empirical evidence on the nature of spatial externalities in a matching model for the UK. We use a monthly panel of outflows, unemployment and vacancy stocks data from the registers at Jobcentres in the UK; th...Read more...

CEP discussion paper

A Picture of Job Insecurity Facing British Men

This paper considers three aspects of the job insecurity facing British men in the last two decades. The probability of becoming unemployed, the costs of unemployment in terms of real wages losses and the probability tha...Read more...

CEP discussion paper

Unemployment Dynamics, Duration and Equilibrium: Evidence from Britain

This paper challenges the consensus on the nature of unemployment dynamics in Britain. We show that the argument that changes in unemployment arise mostly from changes in the duration of unemployment (rather than in the ...Read more...

CEP discussion paper

Wage Equations, Wage Curves and All That

This paper is concerned with the relationship between wages and unemployment. Using UK regions and individuals as the basis for our analysis, the following questions are investigated. First, is the wage equation a relati...Read more...

CEP discussion paper

Fixed-Term Contracts and Unemployment: An Efficiency Wage Analysis

During the 1980s, many European countries introduced fixed-term contracts to fight high and persistent levels of unemployment. Although these contracts have been widely used, unemployment has remained about the same afte...Read more...

CEP discussion paper

Employment Patterns in OECD Countries

This paper studies the dynamics of labour demand and the determinants of employment rates across the OECD. We find: (i) labour demand adjusts less rapidly when employment protection is more strict and union density is hi...Read more...

CEP discussion paper

The Relative Economic Importance of Academic, Psychological and Behavioural Attributes Developed on Chilhood

This paper makes use of the substantial information about the psychological and behavioural development of children by age ten in the 1970 Cohort to predict later, economic outcomes, namely qualifications, employment and...Read more...

Book

The State of Working Britain

What are the prospects for the British labour market at the start of the new century? Since the 1960s Britain has experienced a series of profound changes affecting the way of life and work. This overview and analys...Read more...

Book

Tackling Inequality

Richard Layard is one of Britain's foremost applied economists, whose work has had a profound impact on the policy debate in Britain and abroad. This book contains his most influential articles on the subject of une...Read more...

Book

Tackling Unemployment

Richard Layard is one of Britain's foremost applied economists whose work has had a profound impact on the policy debate in Britain and abroad. This book contains his most influential articles on unemployment. It is publ...Read more...

Journal article

Journal of Labor Economics:

The effects of minimum wages on employment: theory and evidence from Britain

Recent work on the economic effects of minimum wages has stressed that the standard economic model, where increases in minimum wages depress employment, is not supported by empirical work in some labor markets. We presen...Read more...

Journal article

The Review of Economic Studies:

Job creation and job destruction in the theory of unemployment

In this paper we model a job-specific shock process in the matching model of unemployment with non-cooperative wage behaviour. We obtain endogenous job creation and job destruction processes and study their properties. W...Read more...