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Every person deserves the opportunity for dignified employment that provides living wages and potential for advancement. However, for many in America today, this is far from reality, as they are caught in a cycle of low-wage work, earning poverty wages, and unable to move up in the economy. Local leaders, firms, and workers need to adapt quickly to keep pace with rapid technological innovation and its transformative impact on the U.S. economy. Using reskilling as a focal point, this report aims to provide policymakers with tools to do so by answering the following questions: (1) Who are the nation's low-wage workers, and what are their prospects?; (2) Where are the local opportunities for mobility, and how can policymakers expand them and help low-wage workers transition?; and (3) How can the reskilling infrastructure adapt to the future, foster inclusion, and address the needs of any worker seeking upward mobility? Combined with the previous report, "Growing Cities that Work for All," this report illustrates the trends affecting low-wage work and the implications for leaders aiming to improve worker mobility. [For "Growing Cities that Work for All," see ED602975. Support from Google.org and MasterCard Center for Inclusive Growth.]

This document provides an overview of research findings presented and audience response at the "state-the-science" conference conducted by Cornell University October 22-23, 2013 in Washington, D.C. on the topic of "Innovative Research on Employment Practices: Improving Employment for People with Disabilities." An overview of the conference agenda, presentations, and needed next steps identified by participants are provided. An executive summary shares information from attendees about the importance of the research and of the Conference, key themes that emerged from presentations and related discussions, and needed next research and policy steps identified by panelists and participants. [This report was sponsored by the Rehabilitation and Research Training Center on Employer Practices Related to Employment Outcomes among Individuals with Disabilities at Cornell University.]

This research investigates the incidence and wage effects of overskilling for vocational education and training (VET) graduates in Australia between 2001 and 2006. Overskilling is defined as the extent to which workers are able to use their skills and abilities in their current job. The authors compare overskilling with other measures of skill mismatch and skill underutilisation in the workplace and explain why overskilling is their chosen mismatch measure. The research focuses on the impact of four different levels of highest educational attainment: formal school qualification with Year 12; formal school qualification less than Year 12; formal post-school qualification (VET); and formal post-school qualification with diploma/degree. The research finds that many Australian workers report that they are overskilled in their workplace (30% moderately, and 15% severely overskilled). Almost counterintuitively, those with the lowest formal qualifications report the highest incidence of underutilisation. Overskilling is found to be self-perpetuating, but only for university graduates and school graduates. VET graduates show no overskilling state dependence, a result that suggests that a mismatched VET graduate can get out of their mismatched job and into a well-matched job more easily than their school or their university counterpart. The research offers two main conclusions: first, post-school qualifications generate benefits that may go beyond the increased lifetime financial returns often referred to in the literature; and, second, different types of post-school education confer different benefits, in terms of employment possibilities and patterns, with VET being a safer but less well-remunerated education pathway. Appendices include: (1) Descriptive statistics; and (2) Estimation results. (Contains 12 tables and 20 footnotes.)

When chronicling how less-skilled workers have fared in the U.S. since the late 1970's, existing literature often cites their falling wages and declining participation in the labor force. Most research describing these trends, however, focuses primarily on men, failing to account for the fact that less-skilled women's real wages have not fallen, and their labor force participation has actually risen. Rebecca M. Blank and Heidi Shierholz address this topic by breaking down labor market outcomes over the last 25 years by gender and skill level, and exploring possible reasons why less-skilled women might have fared better than less-skilled men in recent decades. Their findings include: Over the last 25 years, women's labor force participation rose steeply while men's fell slightly. This pattern is true among both more and less skilled women. Over the same time period, the male/female wage gap also narrowed. The relationship between education or experience and labor market outcomes has changed. For less-skilled women, the benefit from having additional years of education or experience has improved, and the negative consequences of family and children have lessened. Less-skilled women have benefited from these changes relative to less-skilled men, even while losing ground to more-skilled women. Hence, less-skilled women have occupied an intermediate place in the labor market, doing better than equivalent men but not as well as their more-educated sisters. (Contains 2 figures.) [This paper was prepared from a paper by Rebecca Blank and Heidi Shierholz.]

This paper reviews evidence from industry-specific and case studies that shed light on the extent to which computers and automation eliminate jobs, raise job skill requirements, and, consequently, contribute to increased wage inequality between less- and more skilled workers. This paper complements a previous review of large-scale econometric studies on the same subject, Michael J. Handel, "Implications of Information Technology for Employment, Skills, and Wages: A Review of Recent Research." This paper examines the implications for work and employment of different kinds of manufacturing automation (NC/CNC machine tools, robotics, automated process control) and white-collar computer technologies (data entry, data processing, ATMs, CAD). The sectoral and case study evidence suggests technological change works mostly in the direction of skill upgrading but that the effects on employment levels, occupational composition, skill requirements within jobs, and wages are considerably more modest than theories of skill-biased technological change suggest.

The entry of working welfare mothers into the labor market will have an impact on the wages and employment of low-skilled workers. This impact was examined through a labor market analysis of available statistical data about the U.S. population and employment patterns. The characteristics of workers likely to enter the labor market because of welfare reform were considered along with the following mediators of the effects of welfare mothers' entry into the labor market: the size of the labor influx, the characteristics of welfare mothers, the state of the economy, migration, and institutional arrangements. The analysis revealed that a 10% increase in the number of working welfare recipients could result in a 0.3% wage decrease for men who were born in the United States and do not have a high school diploma. The analysis did not reveal any discernible short-term negative effects of the public assistance group on low-skilled women. In the long run, however, welfare reform will likely increase the number of low-skilled U.S.-born women in the labor force and thus drive down their wages by as much as 2.2%. The claim that immigrants take wage opportunity away from welfare participants appeared to be unfounded. (Six endnotes and twenty-eight references are included.) (MN)

In the United States, Great Britain, the Netherlands, and Denmark, employment trends have been considerably more favorable than in Germany. A country is considered successful in an employment policy context if unemployment is falling steadily or is low and if employment is increasing steadily or the employment rate has reached a high level. Everywhere, low-skilled workers are affected by unemployment to a disproportionately high degree. In the United States, a lower rate of economic growth is sufficient to trigger a one percent increase in employment. The employment threshold, the level of economic growth that triggers an increase in employment, is close to zero in the United States. In Germany, the employment threshold is a Gross Domestic Product growth of about two percent and shifting upward. The Netherlands and the United States show the highest increases in employment. Increases in the Netherlands are due to increased part-time employment predominantly among women who previously had a low labor force participation rate. In both countries, the increase in the population of working age people plays an important role. In regards to wage disparities, the European countries differ from the United States, where the disparities were considerably greater at the upper and lower ends and have increased even further over time. Common features for employment policy success are the following: (1) a comprehensive macroeconomic approach; (2) a favorable framework for investment and consumption; (3) liberalized markets for goods and services; (4) decentralized systems of wage determination; and (5) moderate wage increases. (YLB)

Cities in the United States dramatically expanded spending on public education in the years following World War I, with the average urban school district increasing per pupil expenditures by over 70 percent between 1916 and 1924. We provide the first evaluation of these historically unprecedented investments in public education by compiling a new dataset that links individuals to both the quality of the city school district they attended as a child and their adult outcomes. Using plausibly exogenous growth in school spending generated by anti-German sentiment, we find that school resources significantly increased educational attainment and wages later in life, particularly for the children of unskilled workers. Increases in expenditures can explain about 50 percent of the sizable increase in educational attainment of cohorts born between 1895 and 1915. However, increased spending did not close the gap in educational attainment between the children of skilled and unskilled workers, which remained constant over the period.

While employment growth has accelerated, allowing unemployment to fall significantly since 2005, many low-skilled workers are still unemployed and the duration of unemployment spells is still long. The introduction of an in-work benefit for workers in low-income households, subject to a minimum of hours worked, could lower barriers to higher employment which result from a relatively high tax wedge on low-skill workers, as would the elimination of poverty traps in the pension system. Measures to improve mobility of workers across regions, notably housing policy reform, would lower long unemployment durations, as would the provision of more training to the unemployed. Impediments to higher labour market participation of young women and older workers need to be removed. A bibliography is included. (Contains 34 footnotes, 5 figures, and 2 boxes.) [This paper is based largely on material from the "OECD Economic Survey of the Slovak Republic" published in April 2007 under the authority of the Economic and Development Review Committee (EDRC).]

Focusing on the factors inhibiting the labor market's adjustment to economic change, the study examined the economic and social problems facing southern rural areas and populations, including Chicanos and migrants. Factors were in the areas of the labor market behavior, income and earnings, poverty, welfare system and welfare reform, manpower development and training, economic development, and the community's social and political environments. Data were derived from: an extensive survey of households which obtained economic, social, demographic, and behavioral information; and a survey of county institutions which obtained specific information concerning business activities and the community's economic and social structure and organization. Surveys were conducted in Dodge County, Georgia; Natchitoches Parish, Louisiana; Starr County, Texas; and Sunflower County, Mississippi. Major conclusions were: a substantial portion of the rural southern population was unable to obtain adequate income through work; rural workers were hampered in their income generating efforts by low educational levels, lack of training and of work experience, and health problems; employment discrimination by race and sex was pervasive and one cause of low incomes; and transfer programs had not eliminated poverty and welfare reform would have had significant beneficial impacts on many low income families and the overall economy of the rural South. (NQ)

Utilizing a data file extracted from the University of Michigan Survey Research Center's Panel Study of Income Dynamics, this study examines the work experiences of a national sample of non-aged heads of households. This data source, which describes heads of households and structural characteristics of labor markets, is unique in that underemployed heads of households indicate whether their part-time working status is voluntary or involuntary. Among the heads who were employed during 1971, 15% were part-time workers in the sense that they worked, on average, less than 30 hours per week and/or no more than 40 weeks per year. Findings of this study indicate that 54% of these part-time workers were involuntarily underemployed, willing but unable to devote more time to gainful employment. Furthermore, household heads who were involuntarily underemployed in 197l constituted a clear majority of all non-aged heads who were (1) unemployed (58.0%) and (2) recent labor force dropouts (55.5%) during the spring of l972. These heads of households are, when working, concentrated in low wage jobs. (Author)

The document is based on a premise that mid-twentieth century experience with income distribution cannot be adequately understood without a better knowledge of the long-term macroeconomic forces that have endogenously determined the wage structure. The secular performance of the price of skills and the occupational wage structure are important to an understanding of technique choice, labor-saving technological change, capital formation, and income distribution. A quantitative documentation and an analysis of related literature on the relative price of raw labor, skills, and machines during the period 1816-1896 are presented with illustrative tables and discussion. An attempt is made to redress the balance from labor supply to demand explanations of the long and short-term behavior of wage differentials in the nineteenth century and compare this with the twentieth century experience. (Author/EC)

The document describes the activity, study, and research involving an experimental mobility project which, both by contract and philosophy, sought to assist those individuals in Upper Michigan with relocation and/or placement, who might otherwise have been unable to compete in the migration and economic patterns in the region. Data from extensive interviews with 1,500 clients, with an average followup period of four years, are analyzed to discern patterns of mobility and wage and employment outcomes, and personal and environmental characteristics associated with mobility decisions and outcomes. Multivariate analyses of the postprogram labor force experience of respondents and AID (Automatic Interaction Detector) analyses of conditional probability of relocation are additional aspects of the study examined. It is concluded that the project has demonstrated the feasibility of subsidized relocation for differing groups and has provided the basis for replication of activities and outcomes. Net personal economic benefits associated with relocation are substantial and appear to be maintained even when long-term relocatees return to their home areas to work. Facsimilies of questionnaires, effects of nonresponse, and a glossary of terms are appended. (Author/MW)

Trends in skill bias and greater turbulence in modern labor markets put wages and employment prospects of unskilled workers under pressure. Weak incentives to utilize and maintain skills over the life-cycle become manifest with the ageing of the population. Policies to promote human capital formation reduce welfare state dependency among the unskilled and offset inefficiencies in human capital formation. Skill formation features strong dynamic complementarities over the life-cycle. Investments in the human capital of children have higher returns than investments in the human capital of older workers. There is no trade-off between equity and efficiency at early ages of human development but there is a substantial trade-off at later ages. Later remediation of skill deficits acquired in early years often does not meet the cost-benefit criterion. Positive returns to active labor market and training policies are doubtful. Skill formation is impaired when the returns to skill formation are low due to low skill use and insufficient skill maintenance later on in life. High marginal tax rates and generous benefit systems reduce labor force participation rates and hours worked and thereby lower the utilization rate of human capital. Tax-benefit systems redistribute resources from outsiders to insiders in labor markets, which can be both distortionary and inequitable. Actuarially fairer early retirement and pension schemes reduce the incentives to retire early and strengthen incentives for human capital investment by increasing the time-horizon over which returns to human capital are harvested.