Low-wage careers: are there dead-end firms and dead-end jobs?
Using representative linked employer-employee data of the German Federal Employment Agency, this paper shows that just one out of seven full-time employees who earned low wages (i.e. less than two-thirds of the median wage) in 1998/99 was able to earn wages above the low-wage threshold in 2003. Bivariate probit estimations with endogenous selection indicate that upward wage mobility is higher for younger and better qualified low-wage earners, whereas women are substantially less successful. We show that the characteristics of the employing firm also matter for low-wage earners' probability of escaping low-paid work. In particular small plants and plants with a high share of low-wage earners often seem to be dead ends for low-wage earners. The likelihood of leaving the low-wage sector is also low when staying in unskilled and skilled service occupations and in unskilled commercial and administrational occupations. Consequently, leaving these dead-end plants and occupations appears to be an important instrument for achieving wages above the low-wage threshold.
|Date of creation:||2009|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.arbeitsmarkt.wiso.uni-erlangen.de/english-version/|
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Cappellari, Lorenzo, 2002. " Do the 'Working Poor' Stay Poor? An Analysis of Low Pay Transitions in Italy," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(2), pages 87-110, May.
- Thorsten Schank & Claus Schnabel & Jens Stephani, 2009.
"Geringverdiener: Wem und wie gelingt der Aufstieg?,"
Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik),
Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 229(5), pages 584-614, October.
- Schank, Thorsten & Schnabel, Claus & Stephani, Jens, 2008. "Geringverdiener: Wem und wie gelingt der Aufstieg?," IAB Discussion Paper 200814, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
- Schank, Thorsten & Schnabel, Claus & Stephani, Jens, 2008. "Geringverdiener: wem und wie gelingt der Aufstieg?," Discussion Papers 57, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
- Lorenzo Cappellari, 2007.
"Earnings mobility among Italian low-paid workers,"
Journal of Population Economics,
Springer, vol. 20(2), pages 465-482, April.
- Lorenzo Cappellari & Stephen P. Jenkins, 2004.
"Modelling Low Pay Transition Probabilities, Accounting for Panel Attrition, Non-Response, and Initial Conditions,"
CESifo Working Paper Series
1232, CESifo Group Munich.
- Achatz, Juliane & Gartner, Hermann & Glück, Timea, 2004. "Bonus oder Bias? Mechanismen geschlechtsspezifischer Entlohnung," IAB Discussion Paper 200402, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
- Jung, Sven & Schnabel, Claus, 2009.
"Paying more than necessary? The wage cushion in Germany,"
63, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
- Sven Jung & Claus Schnabel, 2011. "Paying More than Necessary? The Wage Cushion in Germany," LABOUR, CEIS, vol. 25(2), pages 182-197, 06.
- Jung, Sven & Schnabel, Claus, 2009. "Paying More than Necessary? The Wage Cushion in Germany," IZA Discussion Papers 4278, Institute for the Study of Labor (IZA).
- Arne Uhlendorff, 2006.
"From No Pay to Low Pay and Back Again?: A Multi-State Model of Low Pay Dynamics,"
Discussion Papers of DIW Berlin
648, DIW Berlin, German Institute for Economic Research.
- Uhlendorff, Arne, 2006. "From No Pay to Low Pay and Back Again? A Multi-State Model of Low Pay Dynamics," IZA Discussion Papers 2482, Institute for the Study of Labor (IZA).
- Iris Koch & Holger Meinken, 2004. "The Employment Panel of the German Federal Employment Agency," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 124(2), pages 315-325.
- Bernd GÃ¶rzig & Martin Gornig & Axel Werwatz, 2004. "Ostdeutschland: strukturelle Niedriglohnregion?," DIW Wochenbericht, DIW Berlin, German Institute for Economic Research, vol. 71(44), pages 685-691.
- Stewart, M.B. & Swaffield, J.K., 1997.
"Low Pay Dynamics and Transition Probabilities,"
The Warwick Economics Research Paper Series (TWERPS)
495, University of Warwick, Department of Economics.
- Ai, Chunrong & Norton, Edward C., 2003. "Interaction terms in logit and probit models," Economics Letters, Elsevier, vol. 80(1), pages 123-129, July.
When requesting a correction, please mention this item's handle: RePEc:zbw:faulre:66. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.