Dear WorkRise community,
In this month’s New and Noteworthy column, we highlight research that can inform understanding of how low-income households experience inflation and potential policies to offset material hardship. We also share a new Burning Glass Institute report on long-term trends driving employer demand in the labor market. And we take a closer look at a new measure of workplace discrimination and studies that track differences in labor force participation by gender, education, and caregiving status. Is there new and noteworthy research on labor market and economic mobility trends we should amplify? Let us know by writing to apyati@urban.org. As always, thanks for reading!
Research
Macroeconomic trends
- Low-wage workers and inflation: Over the past year, workers in low-wage industries have received significant pay increases from employers struggling to fill positions. Some companies are also raising wages in response to actions taken by competitors. But recent and earlier research indicate that inflation, which is at a 40-year high, can erode the value of wage gains and affects workers across the income distribution differently. A recent Penn Wharton Budget Model analysis estimates that although recent wage gains have been highest for low earners, low-income households have also faced a steeper rise in prices. In this analysis, in absolute terms, low-income households faced higher rates of inflation last year and saw their expenses rise because of higher prices as much as or more than their incomes.
How inflation affects families across the income distribution also depends on what they purchase as well as on supply and demand. In 2019, economist Xavier Jaravel analyzed retail receipts and found prices increasing at a higher rate for products bought by households in the bottom income quintile compared with those purchased by households in the top quintile. Jaravel and other researchers say accounting for “inflation inequality” reflects a more accurate picture of poverty and income inequality than official measures capture.
Labor markets
- Structural forces driving occupational gains and losses: A new Burning Glass Institute report identifies structural forces driving both occupational gains and losses in the labor market. These changes represent long-term shifts in the economy and determine the types of jobs available to workers. The pandemic gave rise to some of these trends and accelerated four in particular: grounding business travel, online shopping, hybrid work, and digital modes of interaction. The Burning Glass Institute estimates about 2.1 million new jobs have been added and 3.5 million jobs have been lost as a result.
Gender and racial disparities
- Trends on parental employment: Several new studies track employment trends during the pandemic and recovery by gender and caregiving status. Researchers at the US Department of Labor find fathers’ employment has recovered while mothers’ employment is lagging by 2 percent. The New York Times covered two studies that illustrate specific challenges faced by mothers. One study finds education, more than gender, determined who remained in the labor force during the pandemic versus those who left. In fact, one group—college-educated women with babies and toddlers—were more likely to be employed compared with prepandemic times because they were able to work remotely. Claudia Goldin, a Harvard economist who conducted the study, found that college-educated, employed women who were also caring for children or aging parents experienced higher stress because they were in the labor force, not because they left. The second study, by Misty Heggeness, a principal economist at the US Census Bureau, found higher rates of employment among school-age mothers while mothers of children younger than five is still 4.2 percent lower than in 2019.
- Measuring systemic discrimination: A new Becker Friedman Institute working paper proposes a new measure of workplace discrimination that accounts for both direct and indirect systemic components. Researchers say current tools to measure discrimination such as audit studies only account for direct actions by individuals; for example, a recruiter that discriminates by screening out women or people of color from consideration during the hiring process. These tools don’t adequately capture systemic factors that drive group-based disparities and perpetuate disadvantage, despite the existence of race- or gender-neutral policies. An example of systemic discrimination would be offering a female candidate a salary based on her salary history, which will likely reflect lower pay rates than a male candidate. In this instance, the hiring manager is not directly discriminating but is applying a gender-neutral policy that doesn’t account for cumulative disadvantage in pay that women experience. The researchers are developing new tools for modeling and measuring direct and systemic forms of discrimination.
Worker power
- Unionization and health outcomes: Research has documented positive links between labor unions and improved workplace safety. A new Health Affairs study finds the presence of labor unions in nursing homes was associated with 10.8 percent lower resident mortality rates and 6.8 percent lower infection rates among workers compared with nonunionized nursing homes.
Announcements and Events
- The Labor and Employment Relations Association’s annual meeting will be virtual and take place June 2–5. Department of Labor Secretary Marty Walsh will speak during the open plenary session. Heather Boushey and Ioana Marinescu will discuss antitrust law as a mechanism for addressing income inequality. WorkRise Leadership Board member and AFL-CIO chief economist Bill Spriggs will moderate this discussion.
Topics in the News:
- OSHA heat standard: As noted in Bloomberg Law, employers and labor advocates are closely watching efforts by the Occupational Safety and Health Administration to develop regulations to protect workers against illness and injury caused by excessive heat in both indoor and outdoor work environments. This is an area where states—particularly those in the western US, where wildfires have raged—are ahead of the federal government in developing occupational heat standards. Related: the Natural Resources Defense Council has developed a tool that tracks state and federal heat protection legislation and provides data on the number of workers in industries at high risk for heat exposure.
- Reforming remedial education in higher ed: Work Shift provides a helpful explainer on state efforts to reform remedial or developmental education in higher education, which some experts compare to “redlining” in education. Black and Latino students are disproportionately enrolled in remedial education courses, and many never make it to credit-bearing, college-level classes. Related: MDRC shares best evidence-based practices to boost college completion rates among those enrolled in development education.