Atypical work and pay.1. Introduction
Even as the economy continues to recover, the U.S. is increasingly becoming a nation of part-timers and free-lancers, of temps and independent contractors. This "disposable" labor force is the most important trend in business today, and it is fundamentally changing the relationship between Americans and their jobs. For companies large and small, the phenomenon provides a way to remain globally competitive while avoiding the vagaries of market cycles ... But for workers, it can mean an end to security and sense of significance that come from being a loyal employee. One by one, the tangible bonds that once defined work in America are giving way. Castro (1993, p. 43.)
The frequency of alternative work arrangements such as temporary employment, on-call on-call Hospital practice adjective Referring to a status in which a physician can be reached and arrive at the hospital within 30 mins of being paged work, and independent contracting--nonstandard forms of employment commonly referred to as "atypical atypical /atyp·i·cal/ (-i-k'l) irregular; not conformable to the type; in microbiology, applied specifically to strains of unusual type.
adj. work"--has steadily increased in recent decades (see, for example, Segal Se·gal , George 1924-2000.
American sculptor known for his realistic plaster casts of people in ordinary situations.
Noun 1. Segal - United States sculptor (born in 1924)
George Segal and Sullivan 1997). Research on atypical work/alternative work arrangements--we shall use the two terms interchangeably--has tended to focus on the nature and extent of these arrangements and their impact on a worker's employment history (e.g., Addison Addison, village (1990 pop. 32,058), Du Page co., NE Ill.; inc. 1884. An industrial suburb of Chicago, it manufactures machinery and plastic items. and Surfield 2006). Although compensation levels have been accorded less attention, the thrust of much of the earnings literature is pessimistic pes·si·mism
1. A tendency to stress the negative or unfavorable or to take the gloomiest possible view: "We have seen too much defeatism, too much pessimism, too much of a negative approach" : Compared with regular or open-ended o·pen-end·ed
1. Not restrained by definite limits, restrictions, or structure.
2. Allowing for or adaptable to change.
3. employment, alternative work arrangements often appear to offer inferior INFERIOR. One who in relation to another has less power and is below him; one who is bound to obey another. He who makes the law is the superior; he who is bound to obey it, the inferior. 1 Bouv. Inst. n. 8. remuneration REMUNERATION. Reward; recompense; salary. Dig. 17, 1, 7. . The public perception remains that workers in these alternative work arrangements constitute a disposable disposable Nursing adjective Referring to that which is discarded or disposed of noun An item used in health care-related Pt contact which is discarded after use–eg masks, gloves, gowns, needles, paper products, syringes, wipes. See Biohazardous waste. workforce characterized char·ac·ter·ize
tr.v. character·ized, character·iz·ing, character·iz·es
1. To describe the qualities or peculiarities of: characterized the warden as ruthless.
2. by low-paying and precarious or unstable unstable,
adj 1. not firm or fixed in one place; likely to move.
2. capable of undergoing spontaneous change. A nuclide in an unstable state is called
radioactive. An atom in an unstable state is called
Abstracting for the moment from the complications introduced by the diversity of alternative work arrangements, there are a number of reasons why their incumbents might earn less than regular workers. For example, wage differentials wage differential n → diferencia salarial
wage differential n → éventail m des salaires
wage differential wage n between atypical workers and those in open-ended employment can arise from supply-side sup·ply-side
Of, relating to, or being an economic theory that increased availability of money for investment, achieved through reduction of taxes especially in the higher tax brackets, will increase productivity, economic activity, and income differences among heterogeneous Not the same. Contrast with homogeneous.
heterogeneous - Composed of unrelated parts, different in kind.
Often used in the context of distributed systems that may be running different operating systems or network protocols (a heterogeneous network). workers and employer preferences. On the supply side, a subset A group of commands or functions that do not include all the capabilities of the original specification. Software or hardware components designed for the subset will also work with the original. of workers may favor nonstandard non·stan·dard
1. Varying from or not adhering to the standard: nonstandard lengths of board.
2. work forms over regular employment, and be prepared to accept lower pay. One example would be adults who are heavily involved in household production, and another is older workers who have moved out of career jobs. But supply-side differences alone are insufficient to sustain a permanent ceteris paribus Ceteris Paribus
Latin phrase that translates approximately to "holding other things constant" and is usually rendered in English as "all other things being equal". In economics and finance, the term is used as a shorthand for indicating the effect of one economic variable on differential in favor of upon the side of; favorable to; for the advantage of.
See also: favor regular workers. In addition, atypical workers and regular workers must not be fully fungible A description applied to items of which each unit is identical to every other unit, such as in the case of grain, oil, or flour.
Fungible goods are those that can readily be estimated and replaced according to weight, measure, and amount. and employers must not be indifferent INDIFFERENT. To have no bias nor partiality. 7 Conn. 229. A juror, an arbitrator, and a witness, ought to be indifferent, and when they are not so, they may be challenged. See 9 Conn. 42. between them.
Negative wage gaps for atypical work are not the only possibility admitted by the competitive model. Atypical workers may earn higher wages than their counterparts in regular employment if the aggregate demand for these nonstandard arrangements is greater than the number of individuals seeking such employment. Thus, to adapt Hirsch's (2005, p. 527) argument in respect of part-timers, if firms use atypical work as low-cost means of adjusting to variable and uncertain demand, the relatively large supply of atypical workers required may run up against mobility or substitution Substitution
put her own son in place of Orestes; her son was killed and Orestes was saved. [Gk. Myth.: Zimmerman, 32]
robber freed in Christ’s stead. [N.T.: Matthew 27:15–18; Swed. Lit. constraints--across labor markets labor market A place where labor is exchanged for wages; an LM is defined by geography, education and technical expertise, occupation, licensure or certification requirements, and job experience delineated de·lin·e·ate
tr.v. de·lin·e·at·ed, de·lin·e·at·ing, de·lin·e·ates
1. To draw or trace the outline of; sketch out.
2. To represent pictorially; depict.
3. by geography, occupation, and industry--and give rise to positive equilibrium equilibrium, state of balance. When a body or a system is in equilibrium, there is no net tendency to change. In mechanics, equilibrium has to do with the forces acting on a body. wage gaps for atypical workers.
Negative wage gaps may of course also be more apparent than real. For example, worker ability and employment in an alternative work arrangement might be negatively correlated cor·re·late
v. cor·re·lat·ed, cor·re·lat·ing, cor·re·lates
1. To put or bring into causal, complementary, parallel, or reciprocal relation.
2. . In this case, an unfavorable wage gap will be attributable attributable
emanating from or pertaining to attribute.
see attributable risk (below).
attributable risk not to type of work arrangement but, rather, to lesser ability. We would certainly like to control for ability so as to avoid drawing faulty fault·y
adj. fault·i·er, fault·i·est
1. Containing a fault or defect; imperfect or defective.
2. Obsolete Deserving of blame; guilty. inferences about earnings and work arrangement in the presence of such sorting behavior on the part of low-ability individuals.
This pattern of negative and positive wage gaps may largely reflect the nature of temporary work. Consider first agency temporaries, namely, workers paid by a temporary help agency. Such workers are typically hired by a client firm where the work is expected to be temporary or is of uncertain duration. Companies may find it cost-effective cost-effective,
n the minimal expenditure of dollars, time, and other elements necessary to achieve the health care result deemed necessary and appropriate. to hire such workers, even if they are of lesser productivity than regular workers, because they are less costly to terminate Terminate (terminat.exe) was a shareware modem terminal and host program for MS-DOS and compatible operating systems developed from the early to the late 1990s by the Dane Bo Bendtsen. The last release (5. (Autor 2003). They may thus form a buffer buffer, solution that can keep its relative acidity or alkalinity constant, i.e., keep its pH constant, despite the addition of strong acids or strong bases. stock. It is likely that the employment of both agency temps and another type of atypical worker, direct-hire temporaries, will increase relative to regular employment in an expansion. In addition, companies may use agency temps to fill vacancies until permanent hires are made and, in some cases, to recruit permanent workers from the ranks of the agency workers themselves. In the latter case, for those choosing to take a low-paid low-paid adj → mal payé(e) → aux salaires bas
low-paid low adj → schlecht bezahlt
low-paid adj agency job to queue Pronounced "Q." A temporary holding place for data. See queuing, message queue and print queue.
(programming) queue - A first-in first-out data structure used to sequence objects. Objects are added to the tail of the queue ("enqueued") and taken off the head ("dequeued"). for regular employment, we will observe a negative equilibrium wage gap. Temporary help agencies probably enjoy scale economies in recruiting and screening of temporary and permanent workers. They pool jobs across companies and can provide workers with a better selection of schedules than can any company acting on its own, while offering employment continuity (albeit with the agency). Similar considerations apply with respect to permanent positions, especially in tight labor markets. Tightening labor markets also encourage the substitution of agency workers for in-house In-house
In the context of general equities, keeping an activity within the firm. For example, rather than go to the marketplace and sell a security for a client to anyone, an attempt is made to find a buyer to complete the transaction with the firm. , on-call worker pools and the direct-hire temporaries.
Why might companies pay agency temporaries less than regular workers, that is, discriminate dis·crim·i·nate
v. dis·crim·i·nat·ed, dis·crim·i·nat·ing, dis·crim·i·nates
a. in favor of the latter? (1) In a labor market consisting of good and risky workers (who may be either good or bad but share poor work histories), firms will be wary of offering permanent contracts to workers who may turn out to be lemons. The firm's choice of the two types of worker depends on the costs per unit of output for each type. Houseman, Kalleberg, and Erickcek (2003) argue that temporary agencies can reduce the costs to firms of hiring risky workers, and may be a more efficient solution to the informational problem than the probationary pro·ba·tion
1. A process or period in which a person's fitness, as for work or membership in a social group, is tested.
a. contract. For example, if agencies are more adept at screening and matching workers, their use raises the probability that the worker will prove suitable--and cheaper to hire and fire if unsuitable (Booth, Francesconi, and Frank 2002). The use by the client company of agencies to hire risky workers allows it to expand the supply of labor and deflect de·flect
intr. & tr.v. de·flect·ed, de·flect·ing, de·flects
To turn aside or cause to turn aside; bend or deviate.
[Latin d the need to raise wages for new and incumbent Refers to an entity that is currently in power. For example, in politics, the "incumbent senator" is the person who holds that office today. An "incumbent company" is an organization that has been providing goods and services for some time. See ILEC. workers.
Again, it is not automatically the case that temporary agency workers will experience lower wages. For example, in the recovery phase a firm will have to pay higher wages to new hires. The higher wages may be generalized gen·er·al·ized
1. Involving an entire organ, as when an epileptic seizure involves all parts of the brain.
2. Not specifically adapted to a particular environment or function; not specialized.
3. throughout the workforce to avoid adverse morale morale,
n the mental state or condition as related to cheerfulness, confidence, and zeal. and productivity effects. This threat may be deflected de·flect
intr. & tr.v. de·flect·ed, de·flect·ing, de·flects
To turn aside or cause to turn aside; bend or deviate.
[Latin d through hiring the new workers, who make more money than the rest, through agencies. On the assumption that agency workers and regular workers are homogeneous The same. Contrast with heterogeneous.
homogeneous - (Or "homogenous") Of uniform nature, similar in kind.
1. In the context of distributed systems, middleware makes heterogeneous systems appear as a homogeneous entity. For example see: interoperable network. , Houseman, Kalleberg, and Erickcek (2003) show that employers may discriminate in favor of agency workers, thereby raising the wages of new entrants without raising the wages of existing employees. The maintained hypothesis is that regular workers are, for a variety of reasons, less knowledgeable about agency temps' wages than they are of other workers' wage levels.
These arguments suggest that temporary agency workers can earn both negative and positive wage differentials. As a practical matter, however, it seems likely that agency temporaries will be less likely to enjoy a premium (and more likely to experience a negative differential) because of their less favorable fa·vor·a·ble
1. Advantageous; helpful: favorable winds.
2. Encouraging; propitious: a favorable diagnosis.
3. skill composition than other atypical worker groups, such as contracting company employees (and independent contractors A person who contracts to do work for another person according to his or her own processes and methods; the contractor is not subject to another's control except for what is specified in a mutually binding agreement for a specific job. ). For example, in their study of hospital use of agency temporaries, Houseman, Kalleberg, and Erickcek (2003, p. 111) find that the cases in which companies use temporary workers to buy time to recruit permanent employees at lower wages are precisely those "where workers must meet clear educational or certification requirements to perform jobs and where the costs of having an unqualified person staff a position are high."
Small and medium-sized Me´di`um-sized`
a. 1. Having a medium size; as, a medium-sized man s>.
Adj. 1. medium-sized - intermediate in size
medium-size, moderate-size, moderate-sized firms will contract with outside 'knowledge workers' because it is not cost-effective to provide the service in-house. For example, economies of scale in the provision of, say, computer support activities might lead the firm to rely on the resources and experience of a computer services Data processing (timesharing, batch processing), software development and consulting services. See service bureau, SaaS and ASP. contracting company (Abraham Abraham [according to the Book of Genesis, Heb.,=father of many nations] or Abram (ā`brəm) [Heb.,=exalted father], in the Bible, progenitor of the Hebrews; in the Qur'an, ancestor of the Arabs. and Taylor Taylor, city (1990 pop. 70,811), Wayne co., SE Mich., a suburb of Detroit adjacent to Dearborn; founded 1847 as a township, inc. as a city 1968. A small rural village until World War II, it developed significantly in the second half of the 20th cent. 1996). It has also been argued that client companies of company contract workers will also include those who are "unable or unwilling to satisfy the demands of knowledge workers for increased control over their work," both in terms of its execution and timing, leading such workers to turn to atypical contracting arrangements (Forde and Slater slat·er
1. One employed to lay slate surfaces, as on roofs.
2. See pill bug.
3. See sow bug.
Noun 1. , 2005, p. 254). Expert workers in such high-skill professional, managerial, scientific, and technical occupations may be expected to earn higher wages than the generality gen·er·al·i·ty
n. pl. gen·er·al·i·ties
1. The state or quality of being general.
2. An observation or principle having general application; a generalization.
3. of regular workers by virtue of their greater skill endowments. It is not clear that they will enjoy an additional premium, outside of the situation discussed earlier, and situations in which companies are using higher-priced contract workers to buy themselves time to recruit regular workers and hence discriminate in favor of these atypical workers. That said, in cases where the skills of contract workers considerably exceed those of regular workers, it is likely that a positive ceteris paribus wage gap will be recorded, especially in circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact.
2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or where, as here, we are not controlling for fringes.
The main contribution of the present paper is to estimate wage differences for the full set of alternative work arrangements while simultaneously controlling for observed demographic characteristics and unobserved person-specific fixed effects. The wage gaps that we identify are the starting point Noun 1. starting point - earliest limiting point
terminus a quo
commencement, get-go, offset, outset, showtime, starting time, beginning, start, kickoff, first - the time at which something is supposed to begin; "they got an early start"; "she knew from the for separate lines of inquiry. We justify our more restricted focus on the grounds that there has been inadequate analysis of earnings differences between atypical and regular workers--as was also the case until very recently for part-time part-time
For or during less than the customary or standard time: a part-time job.
part workers (see Hirsch Hirsch (deer in German and Yiddish) may refer to:
Existing work on atypical worker compensation is either dated (in cross section) or overly restricted in the range of alternative wage arrangements examined (in longitudinal lon·gi·tu·di·nal
Running in the direction of the long axis of the body or any of its parts. data). Accordingly, we seek to update previous findings using subsequent waves of the main data set (the Contingent and Alternative Employment Arrangement Supplement or CAEAS) available to researchers in this area (see section 2), while using a different longitudinal data set (the National Longitudinal Survey of Youth, 1979 Cohort or NLSY NLSY National Longitudinal Survey of Youth (USA) 79) to correct for permanent unobserved differences between individuals for a wider range of alternative work arrangements than hitherto.
A chronological chron·o·log·i·cal also chron·o·log·ic
1. Arranged in order of time of occurrence.
2. Relating to or in accordance with chronology. review of the literature on atypical work and its remuneration is provided in Table 1. Many of the studies are descriptive. The study by Cohany (1998) in row 6 of the table is representative in this regard. It charts little change in the characteristics of those employed in such activities over time (specifically, between the first and the second CAEAS) and, in comparing their median weekly earnings with those of workers in open-ended employment, reports that agency temporaries and on-call workers fare particularly poorly; for example, the median weekly earnings of agency temporary workers are only two thirds of those of regular workers. That said, and again consistent with the findings from the first CAEAS, independent contractors and contract workers enjoy a wage gap of between 15% and 21%.
Differences in wages across the various employment arrangements will reflect differences in worker characteristics. Thus, for example, Cohany reports that atypical workers are younger, have lower educational attainments Educational attainment is a term commonly used by statisticans to refer to the highest degree of education an individual has completed.
The US Census Bureau Glossary defines educational attainment as "the highest level of education completed in terms of the , and are more concentrated in the lower-paid industries and occupations than are regular workers. The study by Polivka, Cohany, and Hipple (2000) in row 8 adopts a multivariate analysis multivariate analysis,
n a statistical approach used to evaluate multiple variables.
n a set of techniques used when variation in several variables has to be studied simultaneously. to control for such differences. The authors' ordinary least squares (OLS OLS Ordinary Least Squares
OLS Online Library System
OLS Ottawa Linux Symposium
OLS Operation Lifeline Sudan
OLS Operational Linescan System
OLS Online Service
OLS Organizational Leadership and Supervision
OLS On Line Support
OLS Online System ) wage regressions put the wage disadvantage of agency temporary work at -5% to -9%. (2) Much of the difference in wages between temporary agency work and regular work appears therefore to be explained by differences in worker characteristics. On the other hand, these authors find no such attenuation Loss of signal power in a transmission.
The reduction in level of a transmitted quantity as a function of a parameter, usually distance. It is applied mainly to acoustic or electromagnetic waves and is expressed as the ratio of power densities. for those workers at the opposite end of the earnings spectrum: Contractors are still estimated to enjoy a wage premium of 23%, at least in 1997, on par with raw results of Cohany.
Polivka, Cohany, and Hipple (2000, p. 77) recognize the limitations of the data set, noting that compensation is influenced by a number of variables not contained in the CAEAS, such as "firm-specific factors, personal tastes, and other unobserved differences that might influence who is in these arrangements." The analyses of Segal and Sullivan (1997, 1998), summarized in rows 4 and 7 of Table 1, in part anticipated these concerns. Although limited to a comparison of agency temporary workers with their counterparts in regular employment, these two studies were the first to control for individual unobserved heterogeneity het·er·o·ge·ne·i·ty
The quality or state of being heterogeneous.
the state of being heterogeneous. in atypical worker earnings determination. The study in row 7 of the table is notable for its use of administrative data (rather than the CAEAS), extracting a 10-year sample panel from the 1984-1994 quarterly records contained in the Washington Washington, town, England
Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. State Unemployment Insurance system, identifying temporary employees through their industry affiliation. (3) A comparison of the authors' pooled and fixed effects regression regression, in psychology: see defense mechanism.
In statistics, a process for determining a line or curve that best represents the general trend of a data set. estimates indicates that accounting for permanent unobserved individual heterogeneity reduces the earnings deficit of temporary workers by between 10% and 15%.
In the final study discussed here of single-parent female welfare recipients initially obtaining atypical work in the temporary help service sector versus other industries, Heinrich Heinrich is a male given name or surname of Germanic origin. Equivalents in other languages are Henry (English), Enrico (Italian), Henri (French), Enrique (Spanish), and Henrique (Portuguese). , Mueser, and Troske (2005) (row 10) report that this choice does not prejudice their future earnings development or continued employment--or, for that matter, welfare recidivism recidivism: see criminology. . Welfare recipients beginning work in this sector do earn substantially less than their counterparts in other sectors, but this difference does not seem to be the result of unmeasured characteristics. Moreover, the low earnings are not permanent: After two years the differences between those initially in atypical work are virtually the same as their counterparts who had jobs in other industries. This faster earnings growth is shown to be partly the result of atypical workers moving to other higher-paying industries. In addition, there is no difference in the proportions of workers who do not have a job one year later across industries, including temporary help. The bottom line from this study is that wage gaps may not persist and that welfare recipients obtain opportunities for future advancement by working in the temporary help service sector.
In the present study, we seek to build and improve upon the existing literature in two ways. First, as noted earlier, unlike the more sophisticated of the ceteris paribus studies in rows 4, 7, and 10 of Table 1, each of our two data sets allows us to examine a wider set of alternative work arrangements than agency temporary employment alone--even if we cannot easily investigate the persistence (1) In a CRT, the time a phosphor dot remains illuminated after being energized. Long-persistence phosphors reduce flicker, but generate ghost-like images that linger on screen for a fraction of a second. of the wage gap. In addition, our longitudinal data set offers a wider array of controls than available in the Current Population Survey (CPS (1) (Characters Per Second) The measurement of the speed of a serial printer or the speed of a data transfer between hardware devices or over a communications channel. CPS is equivalent to bytes per second. ), including proxies for worker ability and a measure of actual experience, while we can update the cross section data set with additional rounds of the CAEAS for 1999 and 2001. Our second contribution to the analysis of the effect of alternative work arrangement on pay is technical in nature. Polivka, Cohany, and Hipple (2000) elect not to use the natural log of a worker's hourly earnings as their dependent variable given certain distributional aspects of the data. More precisely, the right-skewness in the earnings of independent contractors prevented them from directly estimating the Mincerian semi-logarithmic earnings function that has found such strong support in the literature. We adopt a technique that takes the variances of the earnings attaching to the various work forms into consideration, without abandoning the conventional Mincerian earnings function.
Our analysis proceeds as follows. We first outline the empirical model. The two data sets used in this inquiry are next introduced. Then our detailed findings are presented, sequenced by data set. A brief interpretative in·ter·pre·ta·tive
Variant of interpretive.
in·terpre·ta section concludes.
2. The Empirical Model
We use three linear estimating techniques to uncover the effect of atypical work on earnings. For our cross section data set, we estimate a simple ordinary least squares model having pooled the cross section (CAEAS) data. Both random effects Random effects can refer to:
1. To examine methodically by separating into parts and studying their interrelations.
2. To separate a chemical substance into its constituent elements to determine their nature or proportions.
3. the longitudinal (NLSY79) data.
Consider the underlying wage determination model that includes worker ability:
E([w.sub.i,t]|[x.sub.i,t], [AWA AWA As Well As (internet chat lingo)
AWA Animal Welfare Act
AWA Australian Workplace Agreement
AWA America West Airlines
AWA Anime Weekend Atlanta (Anime convention in Atlanta, GA) .sub.i,t],[c.sub.i]) = [[beta]'[x.sub.i,t] + [delta] [AWA.sub.i,t] + [c.sub.i], t = 1, 2, ..., T, (1)
where [w.sub.i,t] is the (log) wage earned by worker i at time t, [x.sub.i,t] are the corresponding observed worker characteristics, [AWA.sub.i,t] is a dummy variable This article is not about "dummy variables" as that term is usually understood in mathematics. See free variables and bound variables.
In regression analysis, a dummy variable equal to one if a worker i is engaged in an alternative work arrangement at time t (zero otherwise), and [c.sub.i] is worker ability. The parameter (1) Any value passed to a program by the user or by another program in order to customize the program for a particular purpose. A parameter may be anything; for example, a file name, a coordinate, a range of values, a money amount or a code of some kind. [delta] is the wage gap or differential that is associated with employment in an alternative work arrangement.
When Equation 1 is estimated by OLS, we have
[w.sub.i,t] = [[beta]'[x.sub.i,t] + [delta][AWA.sub.i,t] + [c.sub.i] + [u.sub.i,t]. (2)
Absent controls for worker ability, OLS will estimate
[w.sub.i,t] = [[beta]'[x.sub.i,t] + [delta][AWA.sub.i,t] + [v.sub.i,t], (3)
where [v.sub.i,t]=([c.sub.i]+[u.sub.i,t]). Equation 3 will still provide unbiased estimates of [delta] provided E[[v.sub.i,t]|[[x.sub.i,t]]=0.
However, we will still have to correct the estimates obtained from Equation 3 to allow for differences in the wage variances observed across the various alternative work arrangements. The conventional method of obtaining the percentage impact of atypical work on wages is to exponentiate the estimated coefficient coefficient /co·ef·fi·cient/ (ko?ah-fish´int)
1. an expression of the change or effect produced by variation in certain factors, or of the ratio between two different quantities.
2. , [delta], and then subtract A relational DBMS operation that generates a third file from all the records in one file that are not in a second file. one. This approach will yield biased and inconsistent Reciprocally contradictory or repugnant.
Things are said to be inconsistent when they are contrary to each other to the extent that one implies the negation of the other. estimates of the differential in percentage terms in the presence of heteroskedasticity. For dichotomous di·chot·o·mous
1. Divided or dividing into two parts or classifications.
2. Characterized by dichotomy.
di·chot variables, such as the various atypical work arrangements, differences in the dispersion dispersion, in chemistry
dispersion, in chemistry, mixture in which fine particles of one substance are scattered throughout another substance. A dispersion is classed as a suspension, colloid, or solution. of the dependent variable (in this case the natural log of the wage rate) may correlate with the error term. Depending on the direction of the correlation, the conventional method of obtaining the percentage differential will either over- over-
1. Above or upon in position: overpass; overcoat.
2. Superior in rank or importance: overlord.
3. or underestimate the true wage effect of atypical employment. This concern has been widely cited in the health economics literature (e.g., Manning 1998) and there is a significant concern that this is the case in our present analysis. Our ceteris paribus estimates are corrected using a procedure adopted in Blackburn Blackburn, city (1991 pop. 109,564) and district, Lancashire, NW England. It was formerly a great cotton-weaving center, noted especially for calicoes. Textiles are still important; other industries produce engineering equipment, electronic components, beer, felt, (2007), the technical details of which are remitted to Appendix A.
Related to Equation 3 is the random effects linear estimator. It allows us to aggregate our three waves of longitudinal data into one pooled sample, assuming the cross-sectional cross section also cross-sec·tion
a. A section formed by a plane cutting through an object, usually at right angles to an axis.
b. A piece so cut or a graphic representation of such a piece.
2. differential has not changed over time. Although this estimator does not take unobserved individual heterogeneity into account, it will produce unbiased and consistent coefficient estimates by allowing for the cross-correlation Cross-Correlation
A statistical measure timing the movements and proximity of alignment between two different information sets of a series of information.
Cross correlation is generally used when measuring information between two different time series. in the error term that arises when we have repeated observations on the same individual.
If, as may be hypothesized, ability and employment arrangements are negatively correlated, however, the estimate of the wage differential will be biased downward. We can remove worker ability from the model using a fixed effects specification that will also be estimated alongside Equation 3. The fixed effects specification allows for not only individual-specific intercepts but also year-specific intercepts, as follows
[w.sub.i,t] = [[alpha].sub.t] + [[phi].sub.i] + [[beta]'[x.sub.i,t] + [delta][AWA.sub.i,t] + [u.sub.i,t], (4)
where [[alpha].sub.t] captures the impact, if any, that time has on worker earnings and where the individual-specific intercept intercept
in mathematical terms the points at which a curve cuts the two axes of a graph. [[phi].sub.i] controls for any time-invariant unobserved worker characteristics, such as ability. Any elements of [x.sub.i,t] that are unchanging un·chang·ing
Remaining the same; showing or undergoing no change: unchanging weather patterns; unchanging friendliness. over time are omitted from Equation 4.
3. The Data
We use two main data sets to estimate the differential attaching to atypical work: the CAEAS to the CPS--as well as the parent CPS itself--and the NLSY79. The advantage of the former data set is its size, given the relatively small proportion of workers in certain alternative work arrangements. The disadvantage is that there is no overlap o·ver·lap
1. A part or portion of a structure that extends or projects over another.
2. The suturing of one layer of tissue above or under another layer to provide additional strength, often used in dental surgery.
v. of households across the supplements, ruling out panel estimation estimation
In mathematics, use of a function or formula to derive a solution or make a prediction. Unlike approximation, it has precise connotations. In statistics, for example, it connotes the careful selection and testing of a function called an estimator. methods. Each attribute is reversed in the case of the latter data set.
The CAEAS/CPS Wage Data
We first extracted one sample from each of the four biennial biennial, plant requiring two years to complete its life cycle, as distinguished from an annual or a perennial. In the first year a biennial usually produces a rosette of leaves (e.g., the cabbage) and a fleshy root, which acts as a food reserve over the winter. CAEAS supplements. To allow for the inclusion of the 2001 CAEAS (4) and to increase the number of regular workers included in our analysis, we link each February February: see month. CAEAS to the subsequent March basic CPS survey using the matching algorithm algorithm (ăl`gərĭth'əm) or algorism (–rĭz'əm) [for Al-Khowarizmi], a clearly defined procedure for obtaining the solution to a general type of problem, often numerical. outlined in Madrian and Lefgren (1999). The CPS collects information on industry, occupation, and wages only for those regular workers who are in an outgoing rotation group In mechanics and geometry, the rotation group is the group of all rotations about the origin of 3-dimensional Euclidean space R3 under the operation of composition. . The CAEAS collects these data for atypical workers without regard to their rotational status. We link the two surveys to allow for the inclusion of regular workers for whom the crucial wage data is elicited e·lic·it
tr.v. e·lic·it·ed, e·lic·it·ing, e·lic·its
a. To bring or draw out (something latent); educe.
b. To arrive at (a truth, for example) by logic.
2. in either February or March. For those regular workers who are observed as being in the March outgoing rotation group, we include only those who are observed in the February CAEAS/CPS data, who report having the same employer (and being employed) in both months, and who have the same activities and occupation in each month. The four cross sections were subsequently pooled to obtain more precise estimates of the wage differentials attaching to the different work arrangements (results for the separate cross sections are available from the authors upon request), while accounting for year effects. Note that the four samples included only those individuals who were employed in the week prior to their February interview. This restriction was imposed because those recorded as unemployed, or as non-participants, would not report any labor force or wage data.
The wage variable is the hourly wage rate. It is constructed following the detailed procedure outlined in Polivka (1999). Workers either reporting or who were calculated to earn less than two dollars an hour or more than $150 an hour were excluded from the samples. Further, only those individuals aged 25 to 65 years at the time of the February survey were included to minimize the problem of compounding differential supply responses. Individuals with incomplete demographic, industrial, and occupational data were excised.
Workers are classified into seven mutually exclusive Adj. 1. mutually exclusive - unable to be both true at the same time
incompatible - not compatible; "incompatible personalities"; "incompatible colors" work arrangements. The first two categories pertain to pertain to
verb relate to, concern, refer to, regard, be part of, belong to, apply to, bear on, befit, be relevant to, be appropriate to, appertain to open-ended employment and comprise regular workers and screened workers. Following the convention established in the literature, we distinguish between five types of atypical workers: agency temporary workers, direct-hire temporary workers, on-call workers, contract company workers, and independent contractors.
Regular workers are those individuals who are directly hired into an open-ended employment arrangement using standard interviewing methods, rather than having first been screened through an alternative work arrangement. We classify clas·si·fy
tr.v. clas·si·fied, clas·si·fy·ing, clas·si·fies
1. To arrange or organize according to class or category.
2. To designate (a document, for example) as confidential, secret, or top secret. individuals as screened workers if they are currently engaged in open-ended employment and they indicate that immediately prior to being employed in this capacity they were employed by the firm in an alternative work arrangement (i.e., without any break in employment continuity). We distinguish between the two types of open-ended employment to allow for the possibility that initially serving an employer as an atypical worker strengthens the bond between employer and employee, and thereby influences the wage paid to such workers.
Since we have already mentioned the five atypical work categories--agency temps, direct-hire temporary workers, on-call workers, contract workers, and independent contractors--only parenthetical remarks are in order. First, since agency temps are defined as those receiving their pay from a temporary help agency, they will include regular employees of the agency in addition to agency temps proper. However, as noted by Houseman and Polivka (2000), a 1989 Industry Wage Survey indicates that these workers comprise only 3.2% of an agency's total employment. Second, as regards contract workers (who differ from independent contractors in that they, like their agency temporary brethren, rely on a third party to provide them with the necessary clients or projects), we require that they have only one client and usually work at that client's workplace. Finally, we note that the CAEAS does not include a specific question on direct-hire temporaries. After Polivka, Cohany, and Hipple (2000, p. 43), we classified individuals as direct-hire temporaries if they indicated that their job was temporary and not intermediated, or that they could not stay in their job as long as they wished for other reasons (they were working only until the completion of a specific project, were hired for a fixed interval, expected to work for less than a year because the job was temporary, etc.).
The NLSY79 Wage Data
The National Longitudinal Survey of Youth, 1979 Cohort (NLSY79) is the product of repeated interviews with individuals aged 14-21 years at the time of the initial interview in 1979 (and therefore just beginning to enter the labor market). To run simple OLS regressions, we first extracted three different cross sections from the data set, covering employees in employment in 1994, 1996, and 1998. With one exception the restrictions were the same as those applied to the CAEAS/CPS: We exclude from the NLSY79 samples those workers who had accumulated ac·cu·mu·late
v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates
To gather or pile up; amass. See Synonyms at gather.
To mount up; increase. less than nine weeks' tenure with their current employer because the survey does not elicit e·lic·it
tr.v. e·lic·it·ed, e·lic·it·ing, e·lic·its
a. To bring or draw out (something latent); educe.
b. To arrive at (a truth, for example) by logic.
2. information such as industry affiliation or the worker's occupational classification from the respondent In Equity practice, the party who answers a bill or other proceeding in equity. The party against whom an appeal or motion, an application for a court order, is instituted and who is required to answer in order to protect his or her interests. unless he or she meets this particular service threshold. The wage rate is measured on an hourly basis, but is constructed from information on earnings and usual hours worked relevant to the frequency at which the individual is actually paid. Next, for random and fixed effects estimates, an unbalanced panel was constructed, covering all three years and applying the same restrictions in respect to missing data and the truncation of the wage distribution. This unbalanced panel construct does not require that workers be recorded as employed for all three years, only for at least two of the three years. It was designed to permit a more precise estimate of the wage gap by including as many observations on individuals as possible.
Individuals were initially grouped into six possible job categories rather than the eight constructed from the CAEAS/CPS. The first two categories of regular workers and screened workers are identical and, as before, the distinction is based on the notion that previously screened workers may be in a better job match. The same is true for agency temporaries and direct-hire temporaries. Since we are unable to distinguish between the two types of contract work, we will speak of a composite contractors/consultants group. The remaining category is a catch-all, comprising 'all other' work types, of which the most numerous subgroup sub·group
1. A distinct group within a group; a subdivision of a group.
2. A subordinate group.
3. Mathematics A group that is a subset of a group.
tr.v. is self-employment The perspective and/or examples in this article do not represent a world-wide view. Please [ edit] this page to improve its geographical balance. .
Descriptive wage data for the four CAEAS/CPS cross sections and the three waves of NLSY79 data are given in Tables 2 and 3, respectively. Beginning with the larger CAEAS/CPS samples, we see that agency temporaries, direct-hire temporaries, and on-call workers earn lower wages than do regular workers. Of the five atypical work arrangements in the CAEAS, agency temps clearly fare the worst, with earnings that are 14% to 32% lower than open-ended employment. Direct-hire temporaries earn between 94 and 98 cents on the regular dollar. And for on-call workers, the raw wage differential is between -6% and -13%. At the other end of the wage spectrum are contract workers and independent contractors. Contract workers earn 6% to 15% more than regular workers, while the wage premium attaching to independent contracting ranges from 21% to 29%. If anything, screened workers earn somewhat higher wages than regular workers.
The earnings of atypical workers vis-a-vis regular workers are directionally the same in the NLSY79 data, but as shown in Table 3 the differences are systematically sharper. For example, the negative wage differential associated with agency temporary employment now ranges from 36% to 43%, whereas workers in contracting/consulting earn a premium of between 22% and 44%. There is less evidence in the NLSY79 that screened workers enjoy any wage advantage over regular employees; indeed, in two out of three waves they earn (4%) less.
Work diaries maintained by the NLSY79 respondents In the context of marketing research, a representative sample drawn from a larger population of people from whom information is collected and used to develop or confirm marketing strategy. provide us with some additional human capital controls not found in the CAEAS/CPS data. Specifically, we have direct data on a worker's (cumulative) general labor market experience as well as his or her tenure on the current job. The NLSY79 gives the actual number of weeks that a respondent has been employed since entering the survey, as well as the actual number of weeks employed with the current employer (or employment type in the case of contractors/consultants and other work types). Moreover, we can also form a standardized standardized
pertaining to data that have been submitted to standardization procedures.
standardized morbidity rate
see morbidity rate.
standardized mortality rate
see mortality rate. measure of the number of jobs held by individuals by dividing the reported total number of jobs held by (cumulative) general labor market experience. This jobs measure can be also viewed as an inverse (mathematics) inverse - Given a function, f : D -> C, a function g : C -> D is called a left inverse for f if for all d in D, g (f d) = d and a right inverse if, for all c in C, f (g c) = c and an inverse if both conditions hold. proxy for the attractiveness of the worker to an employer. Descriptive information on each of these variables is provided in Table 4 for the 1994 wave of the NLSY79. Not surprisingly, workers in atypical work arrangements have substantially less tenure with their (agency) employer than do regular workers. In terms of general labor market experience, it would appear that contractors/ consultants have been employed slightly longer than regular workers. And, despite their having spent fewer years in employment, agency temps have held more jobs on average than those engaged in open-ended employment.
We can also compute To perform mathematical operations or general computer processing. For an explanation of "The 3 C's," or how the computer processes data, see computer. tenure--but not experience and the number of jobs held--for the CAEAS/CPS. As for the NLSY79, tenure is with the current employer for regular and screened employees and with the agency or contracting intermediary Intermediary
See: Financial intermediary
See financial intermediary. for agency temps and contractors, respectively. For the separately identified category of independent contractors--and on-call workers--tenure pertains to the employment arrangement rather than the employer. Comparing the two panels of Table 4, it is apparent that tenure is somewhat longer in the CAEAS/CPS data set.
We now turn to the multivariate The use of multiple variables in a forecasting model. cross-section cross section also cross-sec·tion
a. A section formed by a plane cutting through an object, usually at right angles to an axis.
b. A piece so cut or a graphic representation of such a piece.
2. results, beginning with those for the larger CAEAS/CPS samples. In all cases, we report results for pooled data--rather than the four separate cross sections--since there is no overlap across the supplements. (Separate results for the cross sections are available from the authors upon request.) Table 5 presents results for the simple semi-logarithmic wage model, and entered for reference purposes only since, as was noted earlier, the coefficient estimates produced by this model may not yield consistent estimates of the actual wage differential in percentage terms. Specifically, for dichotomous variables, such as the five atypical work arrangements, differences in the dispersion of the dependent variable (in this case the natural log of the wage rate) may correlate with the model's error term--even if there is no such difficulty with the continuous regressors.
We therefore offer heteroskedasticity-corrected estimates in Table 6, using the procedure outlined in Blackburn (2007). To obtain the differential in percentage terms, one now simply has to multiply mul·ti·ply
1. To increase the amount, number, or degree of.
2. To breed or propagate. the point estimates in the table by 100. Also note that, as in the previous table, separate results are presented for samples that either include or exclude workers with allocated earnings. As shown by Hirsch and Schumacher Schumacher is an occupational surname (German, "shoemaker"), and may refer to: People
v. un·der·stat·ed, un·der·stat·ing, un·der·states
1. To state with less completeness or truth than seems warranted by the facts.
2. the (negative) effect that this work form has on earnings given the high probability that the CPS will allocate to a non-respondent on-call worker the wage rate earned by a regular worker.
Returning therefore to the heteroskedasticity-corrected estimates in Table 6, we first consider results for the larger sample; that is, including workers with allocated earnings. (Recall that the coefficient estimates for continuous variables simply carry over from Table 5.) (5) From the first column of the table, we see that controlling for worker characteristics preserves the wage penalty attaching to direct-hire temporary employment (at about 6%) while attenuating that to agency temporary work (now 15%). Note that the F-tests at the foot of Table 5 reject the possibility that agency and direct-hire temping have the same implications for worker earnings. As regards to the other atypical work arrangements, it can be seen that most of the raw wage disadvantage (from 6% to 13% in Table 2) disappears in the ceteris paribus estimates: On-call workers now receive 1.1% less than regular workers. We also observe attenuation in the wage premiums attaching to each type of contract work: Electing to work as a contract worker (independent contractor) now serves to increase the worker's earnings by 12 (16)%.
The effect of including a quadratic quadratic, mathematical expression of the second degree in one or more unknowns (see polynomial). The general quadratic in one unknown has the form ax2+bx+c, where a, b, and c are constants and x is the variable. term in tenure is shown in the second column of Table 6. The inclusion of the tenure arguments further reduces the wage disadvantage of agency and direct-hire temporary workers and the modest wage disadvantage of on-call workers is eliminated. For contract workers and independent contractors, however, the wage premium is largely unaffected at 14% and 15%, respectively. (The impact of the linear term in tenure on wages is some 2.4% a year, as shown in Table 5.)
Much the same pattern of results is obtained once we remove workers with allocated earnings from the sample. The results are given in columns 3 and 4, which otherwise correspond to the specifications in columns 1 and 2, respectively. There is little suggestion that allocation The apportionment or designation of an item for a specific purpose or to a particular place.
In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as materially affects the results for agency and direct-hire temps or on-call workers, although for each type of contract work the positive premiums increase.
Two final observations should be made with respect to the CAEAS/CPS sample. First, we fail to find any evidence that being screened initially as an atypical worker before being offered regular employment has any effect on the worker's wage. Second, the notion of there being a composite atypical work category is contraindicated: The hypothesis tests at the foot of Table 5 confirm that different work arrangements play distinct roles in earnings determination.
Turning next to the analysis of the NLSY79 earnings data, which are unaffected by any earnings imputation IMPUTATION. The judgment by which we declare that an agent is the cause of his free action, or of the result of it, whether good or ill. Wolff, Sec. 3. problem, our random effects estimates are presented in Table 7. (Results for individual waves of the NLSY79 are available from the authors upon request.) Column 1 presents results for the simple semi-logarithmic specification, while column 2 applies the correction for heteroskedasticity suggested by Blackburn (2007). (6) Columns 3 through 5 introduce controls for ability. Beginning with the results in the first two columns of the table, it can be seen that correcting for heteroskedasticity considerably elevates the absolute magnitude absolute magnitude: see magnitude. of the wage differential attaching to atypical work. This is most obviously the case for agency temps and contractors/consultants (as well as other work types composite that we will not subsequently discuss given its heterogeneity). The negative wage differential associated with agency temporary employment is some 30% and statistically significant, although it is somewhat reduced vis-a-vis the raw differentials earlier reported in Table 3 that ranged from -36% to -44%. The large wage premium enjoyed by contractors/consultants remains very strong: such workers earn wages that are 30% higher than regular employment. As far as the other work forms are concerned, there is every indication that the negative differential observed in the raw data is an artifact A distortion in an image or sound caused by a limitation or malfunction in the hardware or software. Artifacts may or may not be easily detectable. Under intense inspection, one might find artifacts all the time, but a few pixels out of balance or a few milliseconds of abnormal sound of the type of workers filling these positions, while in the case of screened workers we now see for the first time some indication that screening leads to higher wages in open-ended employment.
As was the case for the CAEAS/CPS sample, we find no support for the use of an aggregated temporary work category. Not surprisingly, the results provided at the foot of Table 7 suggest that the two types of temporary employment have a significantly different effect on worker earnings. We also find that aggregating over the various atypical work categories is inappropriate.
The performance of the human capital variables is broadly as expected. Thus, greater firm-specific human capital, as measured by tenure, significantly increases earnings: Each year spent with an employer adds to a worker's earnings by about 3%. And the number of jobs held by an individual negatively impacts earnings: Each additional job that a worker has held since entering the labor market reduces earnings by about 3%. However, the coefficient estimate for general labor market experience is only marginally significant.
Unique to the NLSY79 is the availability of information on the respondent's Armed Forces Qualification Test (AFQT AFQT Armed Forces Qualification Test
AFQT Air Force Officers Qualifying Test ) test scores. The AFQT is a set of standardized tests A standardized test is a test administered and scored in a standard manner. The tests are designed in such a way that the "questions, conditions for administering, scoring procedures, and interpretations are consistent"  used by the military to assess the abilities and knowledge of recruits in the areas of general science, arithmetic reasoning, word knowledge, paragraph comprehension comprehension
Act of or capacity for grasping with the intellect. The term is most often used in connection with tests of reading skills and language abilities, though other abilities (e.g., mathematical reasoning) may also be examined. , numerical numerical
expressed in numbers, i.e. Arabic numerals of 0 to 9 inclusive.
a numerical code is used to indicate the words, or other alphabetical signals, intended. operations, coding ability, auto and shop knowledge, knowledge of mathematics, mechanical comprehension, and electronics information. We formed four separate categories for worker ability. Thus, for example, we combined the scores on the word knowledge and paragraph comprehension tests. The resulting aggregate score was then regressed on a set of age and education dummies at the time the test was administered, which were allowed to have nonlinear A system in which the output is not a uniform relationship to the input.
nonlinear - (Scientific computation) A property of a system whose output is not proportional to its input. effects. The residuals from this regression were used as a proxy for a worker's verbal ability in the OLS wage regression. Measures of mathematical ability, coding ability, and the catch-all of practical ability were derived in a similar manner. (7)
The results of the OLS regressions including these observed ability measures are given in the third column of Table 7. For expositional convenience, we report only the heteroskedasticity-corrected estimates. We see that of the four ability proxies, only coding and math ability are associated with increases in earnings. The coefficient estimates for the other two ability proxies are of the expected sign but fail to achieve significance at conventional levels. Inclusion of the ability proxies does not materially alter the point estimates attaching to agency temporary employment (cf. column 2). However, we do find some evidence that ability and employment as a direct-hire temp are negatively correlated. That said, and contrary to our expectations, the strong wage premium for contractors/consultants is further elevated once we control for ability.
The last two columns of Table 7 provide disaggregated Broken up into parts. results by gender. The results for males are given in column 4 and those for females in column 5. It can be seen that male agency temps have a wage penalty of 45.1%, direct-hire temps a premium of 6.4%, and contractors/ consultants a premium of 32.8%. The corresponding differentials without the ability proxies--not shown in the table--are -44.0%, 7.4%, and 32.8%, respectively. If there is seemingly seem·ing
Outward appearance; semblance.
seeming·ly adv. scant scant
adj. scant·er, scant·est
1. Barely sufficient: paid scant attention to the lecture.
2. Falling short of a specific measure: a scant cup of sugar. evidence that the ability measures influence the male point estimates, the position is somewhat different for female differentials given in column 5. Thus the wage disadvantage of female agency temps of 13.3% is lower in absolute terms (Alg.) such as are known, or which do not contain the unknown quantity.
See also: Absolute than the corresponding estimate without the ability controls (-15.3%). A similar result obtains for direct-hire temps where the reported small premium of 1.1% is to be compared with a without-ability differential of -1.1%. If ability and temporary work are negatively correlated, failure to take ability into consideration will overstate the negative differential. Finally, in the case of female contractors/consultants, the with- and without-ability premia Premia is a comune (municipality) in the Province of Verbano-Cusio-Ossola in the Italian region Piedmont, located about 140 km northeast of Turin and about 40 km northwest of Verbania, on the border with Switzerland. are 62.6% and 66.5%, respectively. In short, for females, introduction of the ability proxies serves to diminish the absolute value of the wage differential, consistent with ability and work arrangement being positively correlated in this case.
In Table 8, we report results of a more conventional accounting for unobserved worker heterogeneity, including ability, using a fixed effects estimator In econometrics and statistics the fixed effects estimator (also known as the within estimator) is an estimator for the coefficients in panel data analysis. If we assume fixed effects, we impose time independent effects for each individual. . Results are presented for the full sample and for males and females separately. For the all-worker sample we observe a virtual halving of the wage disadvantage of agency temping to around -16.5% (compare this value with the estimate in column 2 of Table 7). It also emerges that employment as a direct-hire temporary worker gives higher rewards than regular employment after controlling for unobserved worker heterogeneity. Both results would support the hypothesis that ability and employment in a temporary arrangement are negatively correlated, leading to overestimates of the (negative) effects of these work forms on earnings. By the same token In programming, a string of characters. For example, in the C expression #define MAXAMOUNT 50000, MAXAMOUNT is the token. See also token passing and authentication token.
1. , we observe an attenuation of the wage premium enjoyed by contractors/consultants: they are now recorded as earning a premium of almost 20% versus 30% in the random effects specification in column 2 of Table 7. Seemingly higher-ability workers are sorting themselves into contracting employment, although there was no indication of this when using the proxy for ability (see columns 2 and 3 of Table 7).
In line with the results obtained for the full sample, the results for males in the second column of Table 8 point to a further reduction in the wage penalty for agency temporary employment after allowing for unobserved individual heterogeneity, although the differential remains a sizeable 34%. For direct-hire temporaries, the wage premium increases sharply, which is again consistent with lower ability workers locating jobs in this sector. Interestingly, there is almost no attenuation in the wage premium for contracting/consulting work over regular employment, which is steady at around 30%.
The results for females in the final columns of the table are rather different from those of males. The negative and positive differentials found for female temporary workers and female contractors/consultants, respectively, in the baseline The horizontal line to which the bottoms of lowercase characters (without descenders) are aligned. See typeface.
baseline - released version random effects specification are reversed in the fixed effects estimation. It seems that female temporary workers have unobserved characteristics that lead to lower earnings, and conversely con·verse 1
intr.v. con·versed, con·vers·ing, con·vers·es
1. To engage in a spoken exchange of thoughts, ideas, or feelings; talk. See Synonyms at speak.
2. for female contractors/consultants. In the former case, these characteristics most likely include a preference for flexible employment by reason of family or household demands as well as marginal attachment to the labor force. The fixed effects results would suggest that this group of females actually fares better when employed in temporary jobs than regular work. As far as female contractors/consultants are concerned, the modest negative differential observed in fixed effects can be taken as more indicative of their being of higher ability. If higher-ability females are disproportionately dis·pro·por·tion·ate
Out of proportion, as in size, shape, or amount.
dispro·por opting for contracting/consulting work, then one would expect to find an upward bias in the cross-section estimate of the wage effect.
The bottom line from the NLSY79 analysis is that the use of AFQT and fixed effects produce results that are broadly in the same direction, most obviously in the case of females. The results are much weaker when using AFQT scores to proxy for ability than modeling unobserved individual heterogeneity formally. The standardized tests do not cover certain key aspects of worker heterogeneity (such as motivation and labor force attachment) even if they do seem to do more than confirm the individual's ability to take the relevant tests.
Our analysis extends prior research into the effects of atypical employment on compensation in a number of directions. We have provided updated cross-section evidence (incorporating two additional rounds of the CAEAS). We have provided panel estimates for a full set of atypical work arrangements. We also have corrected the earnings function estimates for skewness Skewness
A statistical term used to describe a situation's asymmetry in relation to a normal distribution.
A positive skew describes a distribution favoring the right tail, whereas a negative skew describes a distribution favoring the left tail. in the earnings distribution throughout, while adjusting for allocated workers in the CPS. With the exception of direct hire temporary workers, who have lower ceteris paribus relative earnings in the CAEAS/CPS and conversely in the NLSY79, our two data sets produce directionally similar results. We refer in particular to the wage disadvantage of agency temps and the wage premium of contractors/consultants. The absolute differentials are stronger in the NLSY79. However, when we restricted the CAEAS/CPS sample to individuals aged 28 to 34 years, consistent with the former sample, we found that differentials increased in absolute value in five out of six cases (these results are available from the authors upon request).
The wage disadvantage of agency temps and the wage premium of contractors/ consultants diminish when we formally allow for unobserved individual heterogeneity. Agency temps have a differential of about 17% and contractors a premium of 20%. But these values are in turn influenced by gender differences. We find that males continue to suffer a rather substantial wage penalty in respect of agency temping (-34%) and a sizeable premium (31%) for contract/consulting work. For females, however, the fixed effect estimates point to a solid premium in agency temping (15%) and a modest negative differential (3.2%) for contracting/ consulting. Selection therefore plays a major role in the case of females.
Finally, to the extent that our results offer a more optimistic op·ti·mist
1. One who usually expects a favorable outcome.
2. A believer in philosophical optimism.
op evaluation of atypical work--to include a wage premium for direct-hire temping and the appearance of a modest premium for screened workers--than the balance of the literature and, indeed, run counter to the thrust of much of the public debate concerning these alternative wage arrangements, we must enter the caveat that we do not here consider fringes, such as access to health and pension benefits. It has been reported that atypical workers have less access to and lower coverage of health insurance than their counterparts in regular employment (e.g., Polivka, Cohany, and Hipple 2000). How do these associations qualify interpretation of our results? In the case of contractors, it may be the case that the earnings premium detected here is sufficient to compensate them for the lack of coverage. By the same token, such individuals may be more likely to have spouses that are covered, so that we may expect a purposive pur·po·sive
1. Having or serving a purpose.
2. Purposeful: purposive behavior.
pur sorting of workers into contracting/consulting, especially those with a stronger preference for money than benefits. Admittedly, agency temps present a different picture. Some such individuals are likely to be temps force majeure [French, A superior or irresistible power.] An event that is a result of the elements of nature, as opposed to one caused by human behavior.
The term force majeure and their health insurance coverage a matter of concern. On the other hand, others will choose to be temps because they prefer the flexibility. Arguably ar·gu·a·ble
1. Open to argument: an arguable question, still unresolved.
2. That can be argued plausibly; defensible in argument: three arguable points of law. , the latter are much more likely to be covered by their spouse's health insurance. We propose to investigate these issues in future research, although even the better data set in this regard (the CAEAS/CPS) offers an imperfect imperfect: see tense. platform for this inquiry.
The standard convention in calculating the ceteris paribus wage differential involves the regression of the log wage on a vector of worker characteristics, x. In using the log wage, rather than the wage in level terms, we are assuming that the underlying wage determination model is
[MATHEMATICAL EXPRESSION A group of characters or symbols representing a quantity or an operation. See arithmetic expression. NOT REPRODUCIBLE re·pro·duce
v. re·pro·duced, re·pro·duc·ing, re·pro·duc·es
1. To produce a counterpart, image, or copy of.
2. Biology To generate (offspring) by sexual or asexual means. IN ASCII ASCII or American Standard Code for Information Interchange, a set of codes used to represent letters, numbers, a few symbols, and control characters. Originally designed for teletype operations, it has found wide application in computers. ], (A1)
where [w.sub.i] is the wage rate earned by worker i, [x.sub.i] is a vector of worker observed characteristics, and [AWA.sub.i] is a variable equal to one if the worker is engaged in an alternative work arrangement (zero otherwise). This model has strong theoretical support, and is usually transformed to a model of the form
log ([w.sub.i]) = [x'.sub.i] [beta] + [psi PSI - Portable Scheme Interpreter ] [AWA.sub.i] + [[epsilon].sub.i], (A2)
where [[epsilon].sub.i] is a standard error term. OLS estimation provides consistent estimates of the log-wage parameters [beta] and [psi] if E[[[epsilon].sub.i]|[x.sub.i], [AWA.sub.i]=0. However, it may not yield consistent estimates of the percentage effect of atypical work on wages.
After estimating (A2), it is conventional to obtain the differential attaching to, say, atypical employment via
[[delta].sub.AWA] = [[epsilon].sup.[spi]] - 1. (A3)
Blackburn (2007) argues that this approach is flawed flaw 1
1. An imperfection, often concealed, that impairs soundness: a flaw in the crystal that caused it to shatter. See Synonyms at blemish.
[MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII]. (A4)
In particular, if the error terms are normal and there is heteroskedasticity in the error terms that is associated with employment in an AWA, then the conventional calculation of the differential will provide an inconsistent estimate of the wage impact of AWAs. This possibility can be tested by taking the residuals from the estimation of Equation A2, squaring them, and then regressing the squared terms on the same elements of [x.sub.i] and [AWA.sub.i] as follows
[e.sup.2.sub.i] = [x'.sub.i] [[lambda].sub.1] + [[lambda].sub.2] AWA. + [u.sub.i] (A5)
If [[lambda].sub.2] does not equal zero, then (A3) will not yield the true percentage impact of AWAs on wages; specifically, a positive (negative) [[lambda].sub.2] would imply that any estimates of [[delta].sub.AWA] using (A3) are over- (under- under-
1. Beneath or below in position: underground.
2. Inferior or subordinate in rank or importance: undersecretary.
3. ) stated.
In these circumstances, Blackburn shows that a more appropriate estimate of the percentage impact of AWAs on wages, [[DELTA].sub.AWA], is
[MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII], (A6)
where the sampling variance The discrepancy between what a party to a lawsuit alleges will be proved in pleadings and what the party actually proves at trial.
In Zoning law, an official permit to use property in a manner that departs from the way in which other property in the same locality of [[DELTA].sub.AWA], is computed as
var([DELTA].sub.AWA]) = [[([DELTA].sub.AWA] + 1).sup.2] * var([psi])] + 1/2 [[([DELTA].sub.AWA] + 1).sup.2] x var([[lambda].sub.AWA])]. (A7)
Appendix B shows the results of fitting Equation A5 for both data sets. It indicates that the use of (A6) is required.
Appendix B Ordinary Least Squares Estimates of Error Dependence (Dependent Variable: Squared Error Term) Estimated Error Dependence Category (Standard Error) Pooled CASAS/CPS data Screened workers -0.022 ** (0.009) On-call workers 0.157 *** (0.010) Agency temporaries 0.048 *** (0.013) Contract workers 0.051 *** (0.016) Direct-hire temporaries 0.092 *** (0.006) Independent contractors 0.299 *** (0.005) Random effects NLSY79 data Screened workers 0.011 (0.011) Contractors/consultants 0.075 * (0.043) Agency temporaries -0.113 *** (0.036) Other work types 0.117 ** (0.049) Direct-hire temporaries 0.002 (0.038) * p < 0.1. ** p < 0.05. *** p < 0.01. Appendix C Full Ordinary Least Squares Regression Estimates of Atypical Worker Wage Differentials, Pooled CAEAS/CPS Data (Dependent Variable: Log Hourly Wage) Estimate Variable (Standard Error) Worker category Screened workers 0.012 (0.008) Direct-hire temporaries -0.072 *** (0.007) Contract workers 0.101 *** (0.020) Agency temporaries -0.109 *** (0.015) On-call workers -0.052 *** (0.013) Independent contractors -0.016 ** (0.008) Demographics Tenure (in years) 0.024 *** (0.001) [Tenure.sup.2]/100 -0.041 *** (0.002) Age 0.028 *** (0.001) [Age.sup.2] -0.000 *** (0.000) Black -0.080 *** (0.006) Other ethnicity -0.032 *** (0.008) Female -0.118 *** (0.006) Married 0.086 *** (0.005) Married females -0.094 *** (0.007) Education level completed High school diploma 0.163 *** (0.006) Some college 0.237 *** (0.007) Associate's degree 0.294 *** (0.008) Bachelor's degree 0.408 *** (0.008) Master's degree 0.515 *** (0.010) JD/MD/PhD 0.570 *** (0.015) Place of residence Urban 0.133 *** (0.004) North Central -0.054 *** (0.005) South -0.080 *** (0.005) West -0.006 (0.005) Industry Construction/mining 0.194 *** (0.017) Transportation, communications, 0.234 *** (0.017) and utilities Finance, insurance, 0.174 *** (0.017) and real estate Manufacturing 0.180 *** (0.016) Retail/wholesale trade -0.025 (0.016) Personal services 0.005 (0.019) Public administration 0.208 *** (0.017) Skill category Business services 0.123 *** (0.018) Professional services 0.064 *** (0.016) Technical/sales workers -0.097 *** (0.007) Service workers -0.371 *** (0.007) Skilled workers -0.141 *** (0.007) Clerical workers -0.241 *** (0.006) Operators/laborers -0.296 *** (0.007) Year dummy 1997 0.048 *** (0.004) 1999 0.123 *** (0.004) 2001 0.203 *** (0.006) N 73,610 Adjusted [R.sup.2] 0.36 * p < 0.1. ** p < 0.05. *** p < 0.01. Appendix D Full Regression Estimates: Ordinary Least Squares Cross-Section Regression Estimates of Atypical Worker Wage Differentials, NLSY79 Data (Dependent Variable: Log Hourly Wage) Estimate Variable (Standard Error) Worker category Screened workers -0.011 (0.011) Direct-hire temporaries 0.002 (0.038) Contractors/consultants 0.075 * (0.043) Agency temporaries -0.113 *** (0.036) Other work types 0.117 ** (0.049) Experience level Jobs (standardized) -0.033 *** (0.009) Experience (in years) 0.010 * (0.005) [Experience.sup.2] 0.001 (0.000) Tenure (in years) 0.028 *** (0.002) [Tenure.sup.2] -0.001 (0.000) Demographics Age 0.050 ** (0.023) [Age.sup.2] -0.001 ** (0.000) Females -0.108 *** (0.013) Blacks -0.080 *** (0.011) Hispanics 0.022 (0.013) Married 0.083 *** (0.012) Married females -0.104 *** (0.016) Education 0.067 *** (0.002) Place of residence Urban 0.035 *** (0.008) North Central -0.133 *** (0.015) South -0.172 *** (0.014) West -0.033 ** (0.016) Industry Construction/mining 0.259 *** (0.039) Manufacturing 0.207 *** (0.036) Transportation, communications, 0.271 *** (0.039) and utilities Retail/wholesale trade 0.018 (0.038) Finance, insurance, 0.267 *** (0.040) and real estate Business services 0.186 *** (0.039) Personal services 0.060 (0.037) Professional services 0.136 *** (0.037) Public administration 0.060 (0.038) Skill category Technical/sales workers -0.028 ** (0.014) Clerical workers -0.148 *** (0.010) Service workers -0.177 *** (0.012) Operators/laborers -0.165 *** (0.013) Skilled laborers -0.116 *** (0.013) Year dummy 1996 0.050 *** (0.007) 1998 0.103 *** (0.010) N 16,919 Adjusted [R.sup.2] 0.42 * p < 0.1. ** p < 0.05. *** p < 0.01.
The authors are more than usually indebted in·debt·ed
Morally, socially, or legally obligated to another; beholden.
[Middle English endetted, from Old French endette, past participle of endetter, to oblige to two referees for their particularly helpful comments on earlier drafts of this paper and to our co-editor for her perseverance Perseverance
See also Determination.
redid dictionary manuscript burnt in fire. [Br. Hist.: Brewer Handbook, 752]
Call of the Wild, The
dogs trail steadfastly through Alaska’s tundra. [Am. Lit. .
Received February 2005; accepted April 2006.
Abraham, Katherine Katherine
“intolerably curst and shrewd and froward.” [Br. Lit.: The Taming of the Shrew]
See : Shrewishness G., and Susan SUSAN Smallest Univalue Segment Assimilating Nucleus
SUSAN Sub Saharan African Network
SUSAN Smart Ultrasonic System for Aircraft NDE K. Taylor. 1996. Firms' use of outside contractors outside contractor n → contratista m/f independiente : Theory and evidence. Journal of Labor Economics The Journal of Labor Economics, published by the University of Chicago Press presents international research examining issues affecting the economy as well as social and private behavior. 14:394-424.
Addison, John T., and Christopher J. Surfield. 2006. The use of alternative work arrangements by the jobless job·less
1. Having no job.
2. Of or relating to those who have no jobs.
n. (used with a pl. verb)
Unemployed people considered as a group. Used with the. : Evidence from the CAEAS/CPS. Journal of Labor Research The Journal of Labor Research is a journal which publishes articles regarding labor relations in the United States.
The journal publishes articles which cover a wide variety of topics in labor relations, including the nature of work, labor-management relations, 27:15-28.
Autor, David H. 2001. Why do temporary help firms provide free general skills training? Quarterly Journal of Economics The Quarterly Journal of Economics, or QJE, is an economics journal published by the Massachusetts Institute of Technology and edited at Harvard University's Department of Economics. Its current editors are Robert J. Barro, Edward L. Glaeser and Lawrence F. Katz. 116:1409-49.
Autor, David H. 2003. Outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. at will: The contribution of unjust UNJUST. That which is done against the perfect rights of another; that which is against the established law; that which is opposed to a law which is the test of right and wrong. 1 Toull. tit. prel. n. 5; Aust. Jur. 276, n.; Hein. Lec. El. Sec. 1080. dismissal doctrine to the growth of employment outsourcing. Journal of Labor Economics 21:1-42.
Blackburn, McKinley The code name for the Itanium 2 CPU chip. See Itanium. L. 2007. Estimating wage differentials without logarithms. Labour Economics. In press.
Blank, Rebecca Rebecca or Rebekah (both: rēbĕk`ə), wife of Isaac and mother of Jacob. One day, as was her custom, she drew water at the city well; while there she showed kindness to Eliezer, Abraham's servant. M. 1998. Contingent work Contingent work, also sometimes known as casual work, is a neologism which describes a type of employment relationship between an employer and employee. There is no universally agreed consensus on what type of working arrangement constitutes contingent work in a changing labor market. In Generating jobs: How to increase demand for less-skilled workers, edited by Richard B. Freeman Richard B. Freeman (born 1943) is one of the leading labor economists in North America. The Herbert Ascherman Professor of Economics at Harvard University, and Co-Director of the Labor and Worklife Program at Harvard Law School, Freeman is also Senior Research Fellow on Labour and Peter Gottschatk. New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of : Russell Sage Russell Sage (4 August 1816 - 22 July 1906) was a financier and politician from New York.
Sage was born at Verona in Oneida County, New York. He received a public school education and worked as a farm hand until he was 15, when he became an errand boy in a grocery conducted Foundation.
Booth, Alison Alison
betrays old husband amusingly with her lodger, Nicholas. [Br. Lit.: Canterbury Tales, “Miller’s Tale”]
See : Adultery L., Marco Francesconi, and Jeff Frank. 2002. Temporary jobs: Stepping stones
The Stepping Stones are three prominent rocks lying 0.5 miles north of Limitrophe Island, off the southwest coast of Anvers Island. or dead ends? Economic Journal 112:F189-213.
Castro Castro, Greece: see Kástron. , Janice. 1993. Disposable workers. Time 140:43-7.
Cohany, Sharon Sharon, city, United States
Sharon (shâr`ən), city (1990 pop. 17,493), Mercer co., NW Pa., on the Shenango River, near the Ohio line; settled c.1800, inc. as a city 1920. R. 1998. Workers in alternative employment arrangements: A second look. Monthly Labor Review The Monthly Labor Review is a publication by the Bureau of Labor Statistics. Monthly publications are usually published by topic. Researchers outside of the BLS are welcome to submit their articles. External links
Forde, Chris CHRIS Chemical Hazards Response Information System (US DoD)
CHRIS California Historical Resources Information System
CHRIS Computerized Human Resources Information System
CHRIS Command Human Resources Intelligence System , and Gary Gary, city (1990 pop. 116,646), Lake co., NW Ind., a port of entry on Lake Michigan; inc. 1909. Gary was founded by the U.S. Steel Corporation, which purchased the land in 1905 and landscaped it for a city. Slater. 2005. Agency working in Britain Britain (brĭt`ən), alternate term for Great Britain, comprised of England, Scotland, and Wales. Often used synonymously with the United Kingdom, the name Britain is derived from Britannia, : Character, consequences and regulation. British Journal of Industrial Relations industrial relations
Relations between the management of an industrial enterprise and its employees.
the relations between management and workers 43:249-71.
Carolyn is a female name in English speaking countries, originally an alteration of the more ancient name Caroline. J., Peter R. Mueser, and Kenneth Troske. 2005. Welfare to temporary work: Implications for labor market outcomes. Review of Economics and Statistics 87:154-73.
Hipple, Steven Ste´ven
n. 1. Voice; speech; language.
Ye have as merry a steven
As any angel hath that is in heaven.
2. An outcry; a loud call; a clamor.
To set steven
to make an appointment. , and Jay Stewart Jay Stewart (real name Jay Fix September 6, 1918 - September 17, 1989) was an American television and radio announcer most famous for his work on several game shows. . 1996. Earnings and benefits of workers in alternative work arrangements. Monthly Labor Review 119:46-54.
Hirsch, Barry Barry, Welsh Barri, town (1991 pop. 45,053) and port, Vale of Glamorgan, S Wales, on the Bristol Channel. Once a major coal-exporting port, its more diversified export products include cement, flour, and steel products. T. 2005. Why do part-time workers earn less? The role of worker and job skills. Industrial and Labor Relations Review Industrial and Labor Relations Review is a publication of the Cornell University School of Industrial and Labor Relations. It is an interdisciplinary journal publishing original research on all aspects of labor relations. 58:525-51.
Hirsch, Barry T., and Edward Edward
killed his father at his mother’s instigation. [Br. Balladry: Edward in Benét, 302]
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Houseman, Susan N., Arne Arne
blinded by stepfather Desmontes after he learned she had been raped and was pregnant. [Gk. Myth.: Howe, 39]
See : Rape L. Kalleberg, and George George, river, c.345 mi (560 km) long, rising in a lake on the Quebec-Labrador boundary, E Canada. It flows N through Indian Lake (125 sq mi/324 sq km) to Ungava Bay (an arm of Hudson Strait). A. Erickcek. 2003. The role of temporary agency employment in tight labor markets. Industrial and Labor Relations Review 57:105-27.
Houseman, Susan N., and Anne Anne, British princess
Anne (Anne Elizabeth Alice Louise), 1950–, British princess, only daughter of Queen Elizabeth II and Prince Philip, duke of Edinburgh. She was educated at Benenden School. E. Polivka. 2000. The implications of flexible staffing arrangements for job security. In On the job: Is long-term Long-term
Three or more years. In the context of accounting, more than 1 year.
1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. employment a thing of the past? edited by David Neumark The Neumark (Nowa Marchia) or East Brandenburg (German: . New York: Russell Sage Foundation. ), also known as the New March (Polish:
Madrian, Brigitte Brigitte is a female given name of Celtic origin. Variants
Some languages spell it with two of the letter "g". People
a. Of or relating to longitude or length: a longitudinal reckoning by the navigator; made longitudinal measurements of the hull.
b. matching Current Population Survey (CPS) respondents. NBER NBER National Bureau of Economic Research (Cambridge, MA)
NBER Nittany and Bald Eagle Railroad Company Technical Working Paper No. 247.
Manning, Willard G. 1998. The logged dependent variable, heteroskedasticity, and the retransformation problem. Journal of Health Economics 17:283-295.
Nollen, Stanley Stanley, town (1991 pop. 1,557), capital of the Falkland Islands, S Atlantic Ocean, on East Falkland island. It is the main port and trading center of the islands. The name is sometimes written as Port Stanley. D. 1996. Negative aspects of temporary employment. Journal of Labor Research 27:567-82.
Polivka, Anne E. 1999. Using earnings data from the Current Population Survey after the redesign re·de·sign
tr.v. re·de·signed, re·de·sign·ing, re·de·signs
To make a revision in the appearance or function of.
re . Bureau of Labor Statistics Bureau of Labor Statistics (BLS)
A research agency of the U.S. Department of Labor; it compiles statistics on hours of work, average hourly earnings, employment and unemployment, consumer prices and many other variables. Working Paper No. 306.
Polivka, Anne E., Sharon R. Cohany, and Steven Hipple. 2000. Definition, composition, and economic consequences of the nonstandard workforce. In Nonstandard work, edited by Francoise Carre et al. Ithaca, NY: Cornell University Cornell University, mainly at Ithaca, N.Y.; with land-grant, state, and private support; coeducational; chartered 1865, opened 1868. It was named for Ezra Cornell, who donated $500,000 and a tract of land. With the help of state senator Andrew D. Press.
Rothstein, Donna S. 1996. Entry into and consequences of nonstandard work arrangements. Monthly Labor Review 119:76-83.
Segal, Lewis M., and Daniel Daniel, book of the Bible
Daniel, book of the Bible. It combines "court" tales, perhaps originating from the 6th cent. B.C., and a series of apocalyptic visions arising from the time of the Maccabean emergency (167–164 B.C. G. Sullivan. 1997. The growth of temporary services Temporary Services is an artist collective of three people based in Chicago, Illinois, USA. They have been collaborating on art projects, public events, publications, and exhibitions since 1998. work. Journal of Economic Perspectives 11:117-36.
Segal, Lewis M., and Daniel G. Sullivan. 1998. Wage differentials for temporary services work: Evidence from administrative data. Federal Reserve Bank of Chicago
The Federal Reserve Bank of Chicago is one of twelve regional Reserve Banks that, along with the Board of Governors in Washington, D.C. Working Paper WP-98-23.
(1) In what follows, we focus on supply-side wages necessary to attract/retain workers rather than the demand price to employers. Clearly, there is a wedge between the two, the price being paid to agency temporary firms by the client employer exceeding the wage received by the agency temps.
(2) Noting a large degree of skewness in earnings, particularly for contractors, Polivka, Cohany, and Hipple (2000) use hourly wages rather than the natural log of the hourly wage in their OLS regressions. Our imputations of the differential shown in the table are obtained by expressing the dollar estimate from the authors' OLS regressions as a percentage of mean reported regular worker earnings in 1995 or 1997. See also Appendix A.
(3) As noted by Segal and Sullivan (1998), one key advantage in using the unemployment insurance administrative data over the CPS is that the source of the information on industrial affiliation is the paycheck-issuing entity (for temporary workers, this would be the temporary help service agency). A concern with worker-reported data (as with the outgoing rotations of the CPS) is that agency temporary workers may cite the industrial affiliation of their client firm rather than that of their true employer--the temporary agency--in which case researchers will fail to identify temporary workers.
(4) In 2001, due to a CPS programming error, the survey was not administered to the outgoing rotation group. For the 2001 sample, we include only those regular workers who are identified in both the February CAEAS and the outgoing rotation group in March.
(5) Full OLS results for the pooled CAEAS sample are provided in Appendix C.
(6) Full OLS results for the NLSY79 sample are provided in Appendix D.
(7) Construction of the mathematical ability measure first required that we sum across the scores for the respondent's arithmetic reasoning, knowledge of mathematics, and numerical operations tests. In similar vein, practical ability was derived from adding the component scores for general science, auto/shop knowledge, mechanical comprehension, and electronics information. Only the coding measure involved no initial summation summation n. the final argument of an attorney at the close of a trial in which he/she attempts to convince the judge and/or jury of the virtues of the client's case. (See: closing argument) .
John T. Addison * and Christopher J. Surfield ([dagger])
* Department of Economics, Moore Moore, city (1990 pop. 40,761), Cleveland co., central Okla., a suburb of Oklahoma City; inc. 1887. Its manufactures include lightning- and surge-protection equipment, packaging for foods, and auto parts. School of Business, University of South Carolina
• • , 1705 College Street, Columbia Columbia, cities, United States
1 City (1990 pop. 75,883), Howard co., central Md., between Washington, D.C., and Baltimore. , SC 29208, USA; E-mail firstname.lastname@example.org See .edu.
(networking) edu - ("education") The top-level domain for educational establishments in the USA (and some other countries). E.g. "mit.edu". The UK equivalent is "ac.uk". ; corresponding author.
([dagger]) Department of Economics, College of Business and Management, Saginaw Valley State University Academic Colleges
SVSU has five academic Colleges. The original College is the College of Arts and Behavioral Sciences.
Table 1. Selected U.S. Studies Examining the Effect of Alternate Work Arrangements on Wages Study Data Methodology Hipple and 1995 Contingent Cross-tabulations Stewart and Alternative alone (1996) (a) Employment Arrangement Supplement to the Current Population Survey (CAEAS/CPS) Rothstein 1994 National Cross-tabulations (1996) Longitudinal Survey of Youth (1979 Cohort) Nollen (1996) 1984 Industry Cross-tabulations Wage Survey, and 1994 Occupation Compensation Survey of Temporary Help Supply Services Segal and 1983-1994 CPS Cross-tabulations Sullivan (1997) outgoing plus cross-section rotations and fixed effects ordinary least squares (OLS) estimations Blank (1998) (a) 1995 and 1996 Cross-tabulations March Current Population Surveys Cohany (1998) (a) 1997 Cross-tabulations CAEAS/CPS Segal and 1984-1994 OLS estimation Sullivan (1998) Washington using cross-section State data, plus worker unemployment fixed effects insurance estimation administrative data Polivka, 1995 and 1997 OLS estimation Cohany, and CAEAS/CPS Hipple (2000) (a) Autor (2001) 1994 Occupation OLS estimation Compensation using cross-section Survey of data, firm fixed Temporary Help effects estimation Supply Services Heinrich, Administrative Cross-tabulations Mueser, and data for female plus OLS earnings Troske (2005) recipients of Aid estimates, with to Families with selection Dependent argument for job Children and choice (derived Temporary from Assistance for a multinomial Needy Families logit) to control in Missouri for unobserved (1993-1997) and individual North Carolina heterogeneity (1997) Study Compensation Work Form(s) Examined Measure(s) Hipple and Median weekly Agency temporary, Stewart earnings on-call, and (1996) (a) contract workers; independent contractors; and regular/traditional workers Rothstein Average hourly Agency and (1996) earnings, and direct-hire average weekly temporary workers, hours contractors/ consultants, and regular workers Nollen (1996) Average hourly Agency temporary wages employment and non-temporary (i.e., regular) employment Segal and Average hourly Agency temporary Sullivan (1997) wages employment and non-temporary (permanent) employment Blank (1998) (a) Hourly earnings Agency temporary workers, regular workers Cohany (1998) (a) Median weekly Agency temporary, earnings on-call, and contract workers; independent contractors; and regular/traditional workers Segal and Quarterly earnings Agency temporary Sullivan (1998) and quarterly employment, and hours worked non-temporary used in calculation (regular) of average hourly employment earnings Polivka, Hourly earnings Agency temporary, Cohany, and direct-hire Hipple (2000) (a) temporary, on-call, contract workers, independent contractors, and regular/traditional workers Autor (2001) Hourly wages; Agency temporary training in word employment only processing, data entry, computer programming Heinrich, Quarterly earnings Welfare recipients in Mueser, and (the current and temporary help Troske (2005) subsequent service industry earnings of and other welfare recipients industries in the temporary help sector are compared with other employed welfare recipients in other industries). The study also examines employment and welfare dynamics. Study Findings Hipple and Median weekly earnings of agency Stewart temporary workers ($290) and on-call (1996) (a) workers ($386) are lower than those of regular workers ($480). Contract employment ($512) and independent contracting ($518) carry a premium. Rothstein Atypical work is associated with lesser (1996) experience: Both agency and direct-hire temporaries spent a lower fraction of the weeks prior to their job in employment (46% and 48%, respectively) as compared with regular workers (75%). The wages of agency temporaries and direct-hire temporaries are 35% and 25% lower than regular workers, respectively. Contractors have similar earnings to regular full-time workers. Nollen (1996) In 1994, agency temporaries earned $7.74 per hour, versus $11.94 for non-temporaries. In both 1984 and 1994, the differential attaching to temporary work approximated 34%, some of which is allied to the disproportionate number of temporaries concentrated in low-paying occupations, such as clerical or laborer positions. Segal and Agency temporaries earned 78 cents on Sullivan (1997) the permanent-worker dollar in 1993. Cross-section OLS estimates controlling for demographic, industrial, and occupation differences are in the range -8% to -14%. Fixed effects regressions point to a negative differential of just 3%, suggesting that much of the wage difference is attributable to unobserved worker heterogeneity. Blank (1998) (a) On average, agency temporaries work 36 hours per week, as compared with 43 hours for regular workers, and receive hourly wages that are 70% of those paid to regular workers. Cohany (1998) (a) Findings similar to Hipple and Stewart (1996) in row 1. Agency temporary workers earn the least ($329 per week) when compared with regular workers ($510), and on-call work pays 85 cents on the regular-employee dollar. Both groups are younger and more likely to be female or a minority member than are regular workers. For their part, contract workers and independent contractors have median weekly earnings of $619 and $587. Segal and The cross-section findings point to Sullivan (1998) a statistically significant negative earnings differential for agency temporary work in excess of 30%. But controlling for worker-specific fixed effects reduces this to between 10% and 15%. Polivka, Cross-tabulations of hourly wages yield Cohany, and results similar to Cohany (1998) in Hipple (2000) (a) row 6. After taking into consideration differences in worker characteristics, the differential attached to agency temporary (contracting) work is estimated to be -5% (23%) in 1997. Autor (2001) Temporary workers offered training were paid 2% to 3% lower wages than those not given training. Firm fixed effects results are of a negative differential in excess of 5%. Heinrich, Welfare recipients in temporary jobs Mueser, and (defined by sector) receive lower earnings Troske (2005) than their counterparts in other jobs initially, but after two years their earnings are virtually identical to those received in other jobs. This implied faster earnings growth arises in part because workers in the temporary help industry are more likely to move into higher- paying industries over time. Accordingly, temporary workers have appreciably better prospects than those who are not holding jobs initially (while vis-a-vis those who held jobs in other sectors they are no more likely to be unemployed or have appreciably higher rates of welfare recidivism). (a) Indicates that the study also examined health insurance benefit access/coverage (together with eligibility for employer-related pensions in the case of the studies in rows 1, 5, and 6). Table 2. Mean Hourly Wage Rates by Employment Arrangement, CAEAS/CPS Data 1995 1997 Regular workers 13.47 (7.71) 14.07 (7.59) Screened workers 13.49 (6.99) 14.13 (6.52) Agency temporaries 9.18 (6.81) 10.98 (8.67) Direct-hire temporaries 12.64 (8.69) 13.81 (10.23) On-call workers 12.61 (12.11) 12.31 (10.66) Contract workers 14.23 (10.27) 15.76 (9.35) Independent contractors 16.29 (13.21) 18.18 (15.26) n 21,885 21,177 1999 2001 Regular workers 15.62 (9.32) 17.22 (10.32) Screened workers 16.37 (9.31) 17.34 (10.44) Agency temporaries 12.00 (13.29) 14.87 (11.76) Direct-hire temporaries 14.86 (11.23) 16.35 (11.86) On-call workers 14.42 (13.58) 15.61 (13.96) Contract workers 17.42 (9.13) 19.78 (12.30) Independent contractors 19.74 (16.78) 21.12 (17.74) n 21,628 8839 Standard deviations in parentheses. Table 3. Mean Hourly Wage Rates by Employment Arrangement, NLSY79 Data 1994 1996 1998 Regular workers 13.57 (9.43) 14.94 (11.22) 16.34 (11.80) Screened workers 13.01 (7.56) 15.29 (9.73) 15.67 (9.92) Agency temporaries 7.70 (4.47) 9.53 (5.17) 9.34 (5.21) Direct-hire temporaries 9.88 (4.31) 9.67 (5.64) 9.79 (4.64) Contractors/consultants 16.49 (20.38) 21.29 (19.03) 23.53 (23.12) Other work types 19.79 (15.85) 19.92 (17.82) 17.78 (6.91) N 5551 5702 5666 Standard deviations in parentheses. Table 4. Labor Market Experience by Employment Arrangement Regular Screened Agency Workers Workers Temporaries 1994 NLSY79 data Experience (in years) 13.03 (3.33) 12.56 (3.24) 10.13 (4.19) Tenure (in years) 5.24 (4.52) 5.01 (4.13) 1.25 (1.77) Jobs (standardized 0.78 (0.56) 0.85 (0.57) 1.67 (1.46) number of jobs) N 4910 427 51 Direct-Hire Contractors/ Other Work Temporaries Consultants Types 1994 NLSY79 data Experience (in years) 10.39 (3.76) 12.69 (3.77) 13.11 (3.58) Tenure (in years) 1.36 (2.57) 3.96 (3.73) 2.11 (2.36) Jobs (standardized 1.49 (l.05) 0.97 (0.55) 1.08 (0.54) number of jobs) N 47 86 30 Regular Screened Agency Workers Workers Temporaries Pooled CASAS/CPS data Tenure (in years) 8.01 (8.01) 6.96 (6.63) 1.53 (2.40) N 53,995 2018 1037 Direct-Hire On-Call Temporaries Workers Pooled CASAS/CPS data Tenure (in years) 5.72 (7.53) 4.86 (6.00) N 4954 613 Contract Independent Workers Contractors Pooled CASAS/CPS data Tenure (in years) 4.47 (6.35) 9.59 (8.57) N 1868 9125 Standard deviations in parentheses. Table 5. OLS Regression Estimates of Atypical Worker Wage Differentials, Pooled CAEAS/CPS Data (Dependent Variable: Log Hourly Wage) (1) Screened workers 0.007 (0.009) Agency temporaries -0.185 *** (0.015) Direct-hire temporaries -0.105 *** (0.007) On-call workers -0.089 *** (0.014) Contract workers 0.083 *** (0.020) Independent contractors 0.001 (0.008) Tenure [Tenure.sup.2]/ 100 Allocated? Y n 73,610 Adjusted [R.sup.2] 0.34 Using the results obtained from the full samples, F-tests were conducted to determine the following restrictions, with test statistic [rho] and p value (in parentheses) reported below: Using Allocated Workers [beta]AT = [beta]DT [rho] = 22.98 (p = 0.000) [beta]CW = [beta]IC [rho] = 14.83 (p = 0.000) [beta]AT = [beta]DT = [beta]OC = [beta]CW = [beta]IC [rho] = 55.95 (p = 0.000) (2) (3) Screened workers 0.012 (0.008) 0.008 (0.011) Agency temporaries -0.109 *** (0.015) -0.175 *** (0.019) Direct-hire temporaries -0.072 *** (0.007) -0.114 *** (0.009) On-call workers -0.052 *** (0.013) -0.104 *** (0.017) Contract workers 0.101 *** (0.020) 0.100 *** (0.027) Independent contractors -0.013 ** (0.008) 0.009 (0.010) Tenure 0.024 *** (0.001) [Tenure.sup.2]/ 100 -0.041 *** (0.002) Allocated? Y N n 73,610 43,465 Adjusted [R.sup.2] 0.36 0.34 Using the results obtained from the full samples, F-tests were conducted to determine the following restrictions, with test statistic [rho] and p value (in parentheses) reported below: [beta]AT = [beta]DT [beta]CW = [beta]IC [beta]AT = [beta]DT = [beta]OC = [beta]CW = [beta]IC (4) Screened workers 0.014 (0.010) Agency temporaries -0.090 *** (0.019) Direct-hire temporaries -0.081 *** (0.009) On-call workers -0.059 *** (0.017) Contract workers 0.115 *** (0.027) Independent contractors -0.011 (0.010) Tenure 0.026 *** (0.001) [Tenure.sup.2]/ 100 -0.042 *** (0.003) Allocated? N n 43,465 Adjusted [R.sup.2] 0.38 Using the results obtained from the full samples, F-tests were conducted to determine the following restrictions, with test statistic [rho] and p value (in parentheses) reported below: Excluding Allocated Workers [beta]AT = [beta]DT [rho] = 8.85 (p = 0.003) [beta]CW = [beta]IC [rho] = 10.62 (p = 0.001) [beta]AT = [beta]DT = [beta]OC = [beta]CW = [beta]IC [rho] = 41.67 (p = 0.000) Huber-White standard errors to correct for heteroskedasticity are given in parentheses. The differences in sample size across the allocated and nonallocated samples are attributable to the loss of the 1995 cross section (see text). Additional controls are age (and [age.sup.2]), gender and ethnicity, a dummy variable equal to one if married (zero otherwise), an interaction term between gender (being female) and marital status, six educational dummies (the omitted category is no high school diploma), a dummy variable equal to one if residing in an urban area (zero otherwise), four regional dummies (the omitted category is residing in the Northeast), 10 industry dummies (the omitted category is agriculture/fishing/forestry), and six occupational dummies (the omitted category is manager). * p < 0.1. ** p < 0.05. *** p < 0.01. Table 6. Corrected Ordinary Least Squares Regression Estimates of Atypical Worker Wage Differentials, Pooled CAEAS/CPS Data (1) (2) Screened workers -0.004 (0.006) 0.000 (0.006) Agency temporaries -0.148 *** (0.008) -0.084 *** (0.009) Direct-hire temporaries -0.057 *** (0.004) -0.030 *** (0.004) On-call workers -0.011 * (0.007) 0.021 *** (0.007) Contract workers 0.115 *** (0.013) 0.137 *** (0.014) Independent contractors 0.162 *** (0.004) 0.147 *** (0.004) (3) (4) Screened workers 0.001 (0.008) 0.005 (0.008) Agency temporaries -0.132 *** (0.010) -0.058 *** (0.011) Direct-hire temporaries -0.057 *** (0.005) -0.030 *** (0.005) On-call workers -0.022 *** (0.008) 0.017 * (0.009) Contract workers 0.143 *** (0.018) 0.168 *** (0.018) Independent contractors 0.183 *** (0.005) 0.166 *** (0.005) Columns 1 through 4 correspond to those in Table 5. See also the notes to Table 5. * p < 0.1. ** p < 0.05. *** p < 0.01. Table 7. Random Effects Ordinary Least Squares Estimates of Atypical Worker Wage Differentials, NLSY79 Data (1) (2) Screened workers 0.011 0.035 *** (0.002) Agency temporaries -0.113 *** (0.036) -0.300 *** (0.006) Direct-hire temporaries 0.002 (0.038) 0.013 (0.012) Contractors/consultants 0.075 * (0.043) 0.304 *** (0.010) Other work types 0.117 ** (0.049) 0.504 *** (0.020) Experience 0.010 * (0.005) 0.010 * (0.005) Experience (2) 0.001 *** (0.000) 0.001 *** (0.000) Tenure 0.028 *** (0.002) 0.028 *** (0.002) Tenure (2) -0.001 *** (0.000) -0.001 *** (0.000) Jobs (standardized) -0.032 *** (0.009) -0.032 *** (0.009) Coding ability Math ability Practical ability Verbal ability Adjusted [R.sup.2] 0.42 N 16,919 16,919 (3) (4) Screened workers 0.024 *** (0.003) -0.016 *** (0.004) Agency temporaries -0.319 *** (0.007) -0.451 *** (0.009) Direct-hire temporaries 0.032 *** (0.012) 0.064 *** (0.017) Contractors/consultants 0.419 *** (0.013) 0.328 *** (0.013) Other work types 0.635 *** (0.025) 0.516 *** (0.030) Experience 0.012 *** (0.005) 0.024 *** (0.008) Experience (2) 0.001 *** (0.000) 0.001 (0.000) Tenure 0.027 *** (0.002) 0.022 *** (0.003) Tenure (2) -0.001 *** (0.000) -0.001 *** (0.000) Jobs (standardized) -0.026 *** (0.009) -0.034 ** (0.015) Coding ability 0.014 ** (0.006) 0.022 *** (0.009) Math ability 0.058 *** (0.009) 0.059 *** (0.012) Practical ability 0.010 (0.010) 0.002 (0.013) Verbal ability 0.012 (0.008) 0.015 (0.011) Adjusted [R.sup.2] 0.43 0.40 N 16,106 8570 (5) Screened workers 0.075 *** (0.004) Agency temporaries -0.133 *** (0.011) Direct-hire temporaries 0.011 * (0.006) Contractors/consultants 0.626 *** (0.038) Other work types 0.888 *** (0.066) Experience 0.008 *** (0.001) Experience (2) 0.001 *** (0.000) Tenure 0.033 *** (0.003) Tenure (2) -0.001 *** (0.000) Jobs (standardized) -0.017 (0.012) Coding ability 0.009 (0.009) Math ability 0.058 *** (0.012) Practical ability 0.004 (0.017) Verbal ability 0.015 (0.012) Adjusted [R.sup.2] 0.44 N 7536 F-tests were conducted to determine the following restrictions, with test statistic p and p value (in parentheses) reported below: Full Sample, Full Sample, Without Ability With Ability Proxies Proxies [beta]AT = [beta]DT [rho] = 5.30 [rho] = 6.57 (p = 0.021) (p = 0.010) [beta]AT = [beta]DT = [rho] = 18.93 [rho] = 23.99 [beta]C/C = (p = 0.00) (p = 0.00) [beta]OTHER Huber-White standard errors to correct for heteroskedasticity in parentheses. Columns 1 though 3 are for all workers, while 4 and 5 pertain to males and females, respectively. Additional controls are age (and age 2), gender and ethnicity, a dummy variable equal to one if married (zero otherwise), an interaction term between gender (being female) and marital status, education (in years), a dummy variable equal to one if residing in an urban area (zero otherwise), four regional dummies (the omitted category is residing in the Northeast), 10 industry dummies (the omitted category is agriculture/fishing/forestry), and six occupational dummies (the omitted category is manager). * p < 0.1. ** p < 0.05. *** p < 0.01. Table 8. Corrected Fixed Effects Ordinary Least Squares Estimates of Atypical Worker Wage Differentials, NLSY79 Data Full Sample Males Screened workers 0.045 *** (0.002) 0.013 *** (0.003) Agency temporaries -0.165 *** (0.005) -0.335 *** (0.009) Direct-hire temporaries 0.118 *** (0.009) 0.153 *** (0.017) Contractors/consultants 0.196 *** (0.008) 0.311 *** (0.016) Other work types 0.390 *** (0.019) 0.149 *** (0.018) Experience 0.087 *** (0.022) 0.144 *** (0.030) Experience (2) 0.001 (0.000) -0.001 * (0.000) Tenure 0.017 *** (0.003) 0.012 *** (0.004) Tenure (2) -0.001 *** (0.000) -0.001 ** (0.000) Jobs (standardized) -0.018 (0.022) 0.002 (0.025) N 16,919 9084 Adjusted [R.sup.2] 0.27 0.16 F-tests were conducted to determine the following restrictions, with test statistic p and p-value (in parentheses) reported below: Full Sample Males Only [beta]AT = [beta]DT [rho] = 2.06 [rho] = 4.53 (p=0.151) (p=0.033) RAT = PDT = [rho] = 1.78 [rho] = 3.86 [beta]C/C = (p = 0.149) (p = 0.009) [beta]OTHER Females Screened workers 0.087 *** (0.002) Agency temporaries 0.151 *** (0.014) Direct-hire temporaries 0.113 *** (0.011) Contractors/consultants -0.032 *** (0.011) Other work types 1.223 *** (0.107) Experience 0.038 (0.030) Experience (2) 0.000 (0.000) Tenure 0.023 *** (0.004) Tenure (2) -0.001 *** (0.000) Jobs (standardized) -0.033 (0.036) N 7835 Adjusted [R.sup.2] 0.28 F-tests were conducted to determine the following restrictions, with test statistic p and p-value (in parentheses) reported below: Females Only [beta]AT = [beta]DT [rho] = 0.01 (p = 0.915) RAT = PDT = [rho] = 1.26 [beta]C/C = (p = 0.287) [beta]OTHER Additional controls are age (and [age.sup.2]), a dummy variable equal to one if married (zero otherwise), an interaction term between gender (being female) and marital status, education (in years), a dummy variable equal to one if residing in an urban area (zero otherwise), four regional dummies (omitted category is residing in the Northeast), 10 industrial dummies (omitted category is working in agriculture/fishing/forestry), and six occupational dummies (omitted category is employment as a manager). * p < 0.1. ** p < 0.05. *** p < 0.01.