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    The IAB announces the conference “Labour Market Transitions: Challenges for Public Policies and Research”

    13 August 2020

    A speaker is giving a presentation in front of an audienceIn the light of Germany’s EU Council Presidency in 2020, the Institute for Employment Research (IAB) is happy to announce an interdisciplinary labour market conference. This conference will focus on various topics concerning labour market transitions and the evaluation of policies that governments implement to smooth such transitions. Along with profound scientific insights, this conference additionally aims at fostering the valuable exchange between scholars and policymakers. Thus, it also considers the relevant perspective of high-level actors engaged in the European labour market policy.

    The conference features Keynotes by Jutta Allmendinger, President of the WZB Berlin Social Science Center and Professor of Educational Sociology and Labor Market Research at the Humboldt University Berlin, and Christian Dustmann, Professor of Economics at the University College London and Director of CReAM – Centre for Research and Analysis of Migration. The conference also includes a political key note and a panel discussion with Dr Nicola Brandt, Head of OECD Berlin Centre, Christian Dustmann und Bernd Fitzenberger, Director of IAB and Professor of Econometrics at the Humboldt University Berlin about “Vocational Training and labor market transitions: The future model for Europe?”

    The conference will take place as a hybrid conference. Please visit our website for further information on the conference programme and to register as an online guest.


    On the foreign to native wage differential in Germany: Does the home country matter?

    12 August 2020

    The German labour force is expected to shrink in the next two decades due to a decline in population. Therefore, the immigration of workers from abroad could compensate potential negative effects of such decline. Is Germany competitive for immigration – i. e., do German employers pay enough to make it attractive as a destination country? We explore the wage gap between foreigners and German employees in particular and focus on different countries of origin to better understand issues related to wage setting among these groups. For this purpose, a threefold Oaxaca-Blinder decomposition is performed using a comprehensive data with a vast amount of information on a large number of workers and firms. The results suggest that most of the wage gap can be explained by observed characteristics, and in most cases, very little difference remains unexplained. We provide evidence on differences specific to the country of origin which could be taken in into consideration to attract people from abroad to better integrate them into the German labour market.

    IAB-Discussion Paper 16/2020


    Cash-for-care, or caring for cash? The eects of a home care subsidy on maternal employment, childcare choices, and children’s development

    10 August 2020

    How parents respond to changes in the price of childcare is an important, though not fully understood, public policy question. Our paper provides new comprehensive evidence on how a home care subsidy jointly affects maternal labour market outcomes, childcare choices, and children’s development. We examine a German reform from 2013 which introduced a home care subsidy of initially 100 Euros per month for families who do not use subsidised childcare. Exploiting a date-of-birth cut-off in eligibility and using administrative data on employment and child development alongside survey data on childcare usage, we show that the reform reduced mothers’ likelihood to return to work within three years by only 1.4 percentage points, but decreased childcare enrolment for one- and two-year olds by 5 percentage points. We find no effect on children’s skill development at age six. Our findings imply that the subsidy accrued almost completely as windfall gains to families whowould not have used formal childcare anyway.

    IAB-Discussion Paper 25/2020


    The effects of foreign direct investment on job stability: Upgrades, downgrades, and separations

    05 August 2020

    We use linked employer-employee data to estimate the effect of foreign direct Investment (FDI) on workers’ job stability. Weare the first to consider firm-internal job transitions. Specifically, we examine the impact of FDI on the individual likelihood to up- or downgrade to occupations with more or less analytical and interactive tasks. To do so, we propose an iterative matching procedure that generates a homogeneous sample of firms with equal probabilities of investing. Based on this sample, we use proportional hazard models to retrieve dynamic effects on workers.

    IAB-Discussion Paper 24/2020


    Redistribution Preferences, Attitudes towards Immigrants, and Ethnic Diversity

    04 August 2020

    Ethnic diversity plays a crucial role in shaping national economic and social policy. A Change in the ethnic composition of a country affects citizens’ everyday life and social environment and may challenge present societal values, such as solidarity with and trust in fellow citizens. Based on the European Social Survey, I show that more contact with members of other ethnic groups in daily life is positively related to more open attitudes of natives towards immigrants. More interethnic contact of natives reduces their social distance to immigrants, their perception of immigrants as a threat to society, and their opposition to future immigration. In turn, an open-minded and tolerant attitude promotes mutual trust and solidarity within society.

    IAB-Discussion Paper 23/2020


    How digitalized is work in large German workplaces, and how is digitalized work perceived by Workers?

    03 August 2020
    Digitalization of work has been made responsible for an increase in labor market inequalities, not only with respect to job loss, but also concerning an increased polarization of the remaining jobs due to processes of devaluation and upgrading of jobs and occupations. However, the discussion about possible consequences is quite polarized and not very sophisticated regarding different technologies and different implementations of the same technology. To understand changes due to digitalization processes, we suggest measuring the implementation of digitalized work both at the individual employee and at the workplace level, because decisions about how digital assistance systems are implemented are made by the latter. Existing representative surveys in Germany so far miss to provide such a comprehensive overview of digitalized work in different occupations and workplaces, as well as their implications for workers. The aim of this paper is to present a newly developed multi-dimensional measurement of digitalized work implemented in a representative linked employer-employee study design. The instrument aims at measuring the prevalence of various dimensions of digitalized work (the use of digital communication, digital information, digital regulation and control, working with robots) and how those are perceived by workers.

    IAB-Forschungsbericht 8/2020

    Why digitisation affects some German federal states more than others

    30 July 2020

    A map of the Federal Republic of Germany with several glowing dotsThe number of jobs in a German federal state (Bundesland) which could be replaced by digital technologies largely depends on the sectoral and occupational structures within this region. In this article, selected occupational segments are analysed to show that the federal states differ greatly in this regard.

    The article can be found in our Magazine IAB-Forum


    Dismissal Protection and Long-term Sickness Absence – First Evidence from Germany

    23 July 2020

    This paper analyses the causal effects of weaker dismissal protection on the incidence of long-term sickness (> six weeks). We exploit a German policy change, which shifted the threshold exempting small establishments from dismissal protection from five to ten workers. Using administrative data, we find a significantly negative reform effect on transitions into long-term sickness in the second year after a worker has entered an establishment. This response is due to a behavioural, rather than a compositional effect and is particularly pronounced among medium-skilled males. Our results further indicate that the reform did not alter the probability of involuntary unemployment after sickness.

    IAB-Discussion Paper 22/2020


    The Spatial Decay of Human Capital Externalities – A Functional Regression Approach with Precise Geo-Referenced Data

    22 July 2020

    This paper analyzes human capital externalities from high-skilled workers by applying functional regression to precise geocoded register data. Functional regression enables us to describe the concentration of high-skilledworkers aroundworkplaces as continuous curves and to efficiently estimate a spillover function that depends on distance. Furthermore, our rich panel data allow us to address the sorting of workers and to disentangle human capital externalities from supply effects by using an extensive set of time-varying fixed effects.

    IAB-Discussion Paper 21/2020


    The Labor Market Impacts of Employer Consolidation: Evidence from Germany

    15 July 2020

    We use detailed administrative data to study how acquisitions — specifically the Acquisition of a plant by a firm with a similar plant in the same local labor market—aectworkers. Using an event study framework with a control group of workers at unaected plants, we find that acquisitions lead to employment losses for workers initially employed at the acquired (or “target”) firm, associated with labor force withdrawals by older female workers. At the same time we find evidence of a rise in wages for workers initially employed at targets and at the acquiring (or “buyer”) firm who remain with the combined enterprise, concentrated among lower-wage workers. We interpret these findings as suggesting that consolidations lead to a reduction in overall employment but a rise in rents per worker that lead to a pattern of losers and winners in the labor market.

    IAB-Discussion Paper 20/2020


    “Acceptance of social- and labor market programs and regulations”: Methodological report on the first survey wave

    14 July 2020

    The FIS-funded project “Acceptance of social- and labor market programs and regulations” asks citizens about their assessment of specific design alternatives for social and labor market policies in Germany. This report describes the design and the field organization of the first online survey conducted by the project. Furthermore, it presents a selectivity analysis of contact and participation probabilities as well as for consent to merge the survey data with administrative data.

    IAB-Forschungsbericht 7/2020


    What helps the “ka-boom”? Five elements of a sound economic stimulus programme for Germany

    09 July 2020

    A person stacking up coinsPolitical plans aimed at kick-starting national economies have been introduced in many countries worldwide. The German Bundestag and Bundesrat passed a Coronavirus Tax Relief Act on 29 June 2020 that involves the first key elements of a large scale recovery programme. It is designed to get the German economy out of the crisis “with a ka-boom” as Germany’s Finance Minister Olaf Scholz put it. Some thoughts on the Government’s programme by IAB Director Bernd Fitzenberger.

    The article can be found in our Magazine IAB-Forum

    Click the following link for more articles in the series: Series “COVID-19 Crisis: Consequences for the Labour Market”


    Short-time work in Europe: Rescue in the coronavirus crisis? An interview with IAB researcher Regina Konle-Seidl

    25 June 2020

    A person is holding a blue safety helmet unter the arm.The coronavirus pandemic is keeping the economy on edge. To overcome the crisis, 33 of 36 OECD countries are now using short-time working schemes. All are pursuing the same goal of avoiding redundancies and retaining jobs. While the objective is the same in all countries, each country nevertheless tries to balance out a high use of the instrument and low deadweight effects and abuse. In an interview, the IAB researcher Regina Konle-Seidl explains the most important differences, discusses the advantages and disadvantages of short-time work, draws lessons from the use of this instrument in earlier times of crisis, and depicts first developments of short-time work and unemployment figures.

    The article can be found in our Magazine IAB-Forum

    Click the following link for more articles in the series: Series “COVID-19 Crisis: Consequences for the Labour Market”

    See also: IAB-Forschungsbericht (IAB Research Report) 4/2020


    What do we know about the employment of refugees in Germany? Answers to some frequently asked questions.

    18 June 2020

    Two workers wearing orange vests

    In 2015, the highest number of refugees arrived in Germany since the end of the Second World War. The overall number of refugees in Germany increased by 1.2 million people until the end of 2018. A recent analysis implies faster labour market integration of refugees who arrived in Germany between 2013 to 2016 than was the case for refugees from previous years. The results show that the employment rate increases with the duration of stay. These figures are an important indicator for the integration of refugees into the labour market and have therefore been widely discussed in Germany. In this interview, the authors Herbert Brücker and Yuliya Kosyakova answer key questions about the study, which was co-authored with Eric Schuß.

    The article can be found in our Magazine IAB-Forum


    Short-time Work in Europe: Rescue in the Current COVID-19 Crisis?

    16 June 2020

    More countries than ever are using short-time work as a labour market policy instrument to secure employment and limit the social costs of the current COVID-19 Crisis. Highlighting the economic rationality of short-time work the report classifies European short-time work programmes into different clusters and describes significant changes in the programme design since March 2020. It further discusses possible effects against the background of empirical findings on short-time work from past times of crisis.

    IAB-Forschungsbericht 4/2020



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