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Using occupational structure to measure employability with an application to the Brazilian labor market

Listed author(s):
  • Sergio Firpo

    ()

  • Sandro Carvalho
  • Renan Pieri

We propose measuring individual employability as a weighted average across occupations of a worker’s predicted wage for each occupation. Weights are given by the individual occupational probability distribution. Under this measure, a worker is more employable than another if she has a greater chance to obtain a better paid occupation. After normalization, expected employability corresponds to the population correlation between occupational predicted wages and the chance to obtain employment in these occupations and serves as a measure of the allocative efficiency of labor market. We apply the methodology to Brazil and found that employability increased and became less unequally distributed from 2002 to 2011. We used a decomposition method to investigate the causes of these changes. Although average normalized employability is weakly positive, it has increased for the period, which suggests that there is room for efficiency gains in the allocation of workers to occupations in the Brazilian labor market. Copyright Springer Science+Business Media New York 2016

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File URL: http://hdl.handle.net/10.1007/s10888-015-9313-3
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Article provided by Springer & Society for the Study of Economic Inequality in its journal The Journal of Economic Inequality.

Volume (Year): 14 (2016)
Issue (Month): 1 (March)
Pages: 1-19

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Handle: RePEc:kap:jecinq:v:14:y:2016:i:1:p:1-19
DOI: 10.1007/s10888-015-9313-3
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  1. Ronald W. McQuaid & Colin Lindsay, 2005. "The Concept of Employability," Urban Studies, Urban Studies Journal Limited, vol. 42(2), pages 197-219, February.
  2. Sattinger, Michael, 1993. "Assignment Models of the Distribution of Earnings," Journal of Economic Literature, American Economic Association, vol. 31(2), pages 831-880, June.
  3. Wim Groot & Henriette Maassen Vann De Brink, 2000. "Education, training and employability," Applied Economics, Taylor & Francis Journals, vol. 32(5), pages 573-581.
  4. Stephan L. Thomsen, 2009. "Explaining the Employability Gap of Short-Term and Long-Term Unemployed Persons," Kyklos, Wiley Blackwell, vol. 62(3), pages 448-478, 08.
  5. Maarten Goos & Alan Manning, 2007. "Lousy and Lovely Jobs: The Rising Polarization of Work in Britain," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 118-133, February.
  6. Ronald McQuaid, 2006. "Job search success and employability in local labor markets," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 40(2), pages 407-421, June.
  7. Sergio Firpo & Nicole M. Fortin & Thomas Lemieux, 2009. "Unconditional Quantile Regressions," Econometrica, Econometric Society, vol. 77(3), pages 953-973, May.
  8. David Card & Pablo Ibarrarán & Ferdinando Regalia & David Rosas-Shady & Yuri Soares, 2011. "The Labor Market Impacts of Youth Training in the Dominican Republic," Journal of Labor Economics, University of Chicago Press, vol. 29(2), pages 267-300.
  9. Andries GRIP & Jasper LOO & Jos SANDERS, 2004. "The Industry Employability Index: Taking account of supply and demand characteristics," International Labour Review, International Labour Organization, vol. 143(3), pages 211-233, September.
  10. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2008. "Trends in U.S. Wage Inequality: Revising the Revisionists," The Review of Economics and Statistics, MIT Press, vol. 90(2), pages 300-323, May.
  11. Lucas Ronconi & Juan Sanguinetti & Sandra Fachelli & Virginia Casazza & Ignacio Franceschelli, 2006. "Poverty and Employability Effects of Workfare Programs in Argentina," Working Papers PMMA 2006-14, PEP-PMMA.
  12. Schmidt, Peter & Strauss, Robert P, 1975. "The Prediction of Occupation Using Multiple Logit Models," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 16(2), pages 471-486, June.
  13. Smith, Jeremy & McKnight, Abigail & Naylor, Robin, 2000. "Graduate Employability: Policy and Performance in Higher Education in the UK," Economic Journal, Royal Economic Society, vol. 110(464), pages 382-411, June.
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