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Inhaltsbereich: Institut für Arbeitsmarkt- und Berufsforschung

    Training, wages and a missing school graduation cohort

    16 September 2020
    This study analyzes the effects of a missing high school graduation cohort on firms’ training provision and trainees’ wages. An exogenous school reform varying at the state and year level caused the missing cohort to occur. Using administrative social security data on all trainees and training firms, we show that firms provide less training by reducing their overall number of hired apprentices. We also show that the pool of firms that offer training in the year of the missing cohort shifts towards a higher share of low wage firms. After keeping firm characteristics constant, the findings indicate that the missing cohort increases training wages measured at the start of training. Further analyses shed light on the opposite case of dual cohorts, which we find to increase training provision and to decrease training wages. The evidence also shows that high and low wage firms differ in how they adjust training provision in response to a dual cohort.

    IAB-Discussion Paper 28/2020

    Employment Subsidies for Long-Term Welfare Benefits Recipients: Reconciling Programmes’ Goals with Needs of Diverging Population Groups

    10 September 2020

    We discuss the design and examine the inflow of participants in two new subsidised employment programmes (§ 16 e/i German Social Code II) that aim to help long-term welfare recipients in Germany to find a job and increase their social participation. We describe the programmes in terms of goals and eligibility criteria and proceed to analyse recent inflows into the programmes using Latent Class (Cluster) Analysis in an exploratory manner. Our findings provide evidences on the considerable heterogeneity in the programmes’ inflows. The resulting typology does not only connect individual biographical and socioeconomic characteristics with greater sociohistorical processes, but give strong hints towards different needs of the various participant groups which could be treated differently in the programmes. Keeping up and improving social integration through subsidized labour is a high priority treatment to be considered for some participant groups, while others should be considered more for improvements of education and professional training, even if their biographies so far show most distance to both. Our results provide first guidance on how to adjust programme’s design to the needs and capabilities of heterogeneous groups of long-term unemployed and welfare benefit recipients.

    IAB-Discussion Paper 27/2020


    Daughters of migrants often participate in further training

    20 August 2020

    Several young women are shown studying in a classroom, one of them is raising her handDigitisation, demography and ever increasing international interdependence require life-long learning of employees. Yet, participation in vocational further training has so far been unequally distributed among different groups. This is also obvious for the employees with a migration background: Men who immigrated themselves seldom take part in further training, whereas women whose parents had come as immigrants often do so.

    The article can be found in our Magazine IAB-Forum


    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 will take place as a hybrid conference. For more information, visit our event website. For further information on the conference programme and to register as an online guest, please visit our XING Events website.


    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 26/2020


    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



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