Documents University of Nottingham 33 results

"We study how unionisation affects competitive selection between heterogeneous firms when wage negotiations can occur at the firm or at the profit-centre level. With productivity specific wages, an increase in union power has: (i) a selection-softening; (ii) a countercompetitive; (iii) a wage-inequality; and (iv) a variety effect. In a two-country asymmetric setting, stronger unions soften competition for domestic firms and toughen it for exporters. With profit-centre bargaining, we show how trade liberalisation can affect wage inequality among identical workers both across firms (via its effects on competitive selection) and within firms (via wage discrimination across destination markets)."

"In view of global trends of increasing digitalization and the use of artificial intelligence (AI) in workplaces, more knowledge is required by staff representatives to support their members when these trends impact their organizations and trigger the implementation of drastic organizational changes. In addition, as of 2020, digitalization and AI have experienced an impetus caused by the COVID-19 pandemic and the need to adapt to ever new working environments and methods for many staff. Those include extensive teleworking and enhanced learning and use of online tools for communication. Due to the economic impact of the current health crisis, many of FICSA's member organizations are experiencing reorganizations, or are faced with plans of reorganization, with the aim of cost saving through downsizing and creating leaner structures, as well as putting in place ever faster ways of information generation and emissions. These new ways of working also bear challenges in relation to the introduction of more precarious working conditions. Clearly staff, as well as organizations will need to adapt, but not to the detriment of the health and safety of staff. This report has been commissioned by FICSA and its member organizations to review and analyze the literature and key policy developments on the impact of digitalization at work and discuss its implications for international civil servants. The review of the evidence will also be used to develop guidance for staff representatives to enable them to support their members within this context."

"We explore the impact of wage adjustment on employment with a focus on the role of downward nominal wage rigidities. We use a harmonised survey dataset, which covers 25 European countries in the period 2010-2013. The main advantages of the data are firm-level information on the change in economic conditions and collective pay agreements. Our findings confirm the presence of wage rigidities in Europe: first, collective pay agreements reduce the probability of downward wage adjustment; second, the rise in the probability of downward base wage responses to a decrease in demand is significantly smaller than the rise in the probability of an upward wage response to an increase in demand. Estimation results point to a negative effect of downward wage rigidities on employment at the firm level."

"Economists have long assumed that all information and communication technologies affect the performance of firms in similar ways. Enterprise and Resource Planning Software connecting sales, marketing, inventory and accounts, affected performance in the same way as a Virtual Private Network that allowed working from home or a website that created opportunities for e-commerce. Newer theoretical evidence has shown that this is not the case: technologies that affect the communication of information affect the management and organisation of firms in ways that are distinct from technologies that make it easier to store and process information. The next step was to find empirical evidence that either supported or refuted this new view.



In this GEP working paper GEP internal fellow Richard Kneller along with two former Nottingham PhD students, Tim De Stefano and Jonathan Timmis, both now at the OECD, provide for the first time evidence for the ways that communication-ICT affect the performance of firms. To do so free from concerns about endogeneity bias they use an instrumental variable approach that relies on differences in firms' access to one particular communication-ICT, namely broadband internet. These differences arise because this technology is delivered using the telephone network and different telephone exchanges were enabled for broadband at different times and the speed of connection slows the further one is located away from the exchange. They show that, after placing various restrictions on the sample, instruments based on the timing of ADSL broadband enablement and the cable distance to the local telephone exchange satisfy the conditions for instrument relevancy and validity for some types of ICT. They find in turn, that communication-ICT causally affects firm size (captured by either sales or employment) but not productivity."

"We review the literature on recent demographic changes in Europe, focusing on two of the main challenges brought about by an ageing population: severe labour shortages in many sectors of the economy and growing pressures on both health and welfare systems. We discuss how and to what extent migration can contribute to address these challenges both from a short and a long term perspective. Finally, we identify several areas in which more research is needed to help devising more effective policies to cope with a greying society."

"We estimate the earnings, hours and income effects of job loss (displacement) for a representative sample of UK workers from 1991–2007. We are able to follow workers before and after displacement regardless of their labour market state, and we are able to precisely match displaced workers with observably similar non-displaced workers. We show that job loss is associated with a long-run reduction in income which is mainly due to reductions in monthly pay conditional on employment rather than in employment propensity. Entry into unemployment is very short-lived, and while there is some entry into other labour market states, this does little to compensate for income losses. Total income from welfare payments, including unemployment insurance, retirement income and invalidity benefit reduces losses by only 15% in the first 12 months after job loss, and become even less important as time passes. The lack of a “safety net” means that job loss in the UK has a similar effect to job loss in the US."

"This paper estimates wage equations to test for changes in the responsiveness of wages to unemployment using panel estimates which pool the data across the euro area countries. More specifically, we investigate whether the sensitivity of euro area wages to movements in unemployment is different during downturns (i.e., downward wage rigidity), whether it has changed during the crisis and which institutional features might be driving the results. We find evidence of a lower responsiveness of wages to unemployment during downturns, consistent with the stylised facts that euro area wages are rigid downwards. We also find that the degree of downward wage rigidity has declined as the crisis became more prolonged. Overall, it seems that much of the downward wage rigidity reflects institutional factors, such as a high degree of union coverage and employment protection. Additionally, a rising share of the long-term unemployed lowers the responsiveness of wages to unemployment while a rising share of temporary labour seems to dampen wage growth."

"We investigate how individual workers and local labour markets adjust over a long time period to a discrete and plausibly exogenous technological shock, namely the introduction of containerisation in the UK port industry. This technology, which was introduced rapidly between the mid-1960s and the late-1970s, had dramatic consequences for specific occupations within the port industry. Using longitudinal micro-census data we follow dock-workers over a 40 year period and examine the long-run consequences of containerisation for patterns of employment, migration and mortality. The results show that the job guarantees protected dock-workers' employment until their removal in 1989. A matched comparison of workers in comparable unskilled occupations reveals that, even after job guarantees were removed, dock-workers did not fare worse than the comparison group in terms of their labour market outcomes. Our results suggest that job guarantees may significantly reduce the cost to workers of sudden technological change, albeit at a significant cost to the industry."

"We use a simple non-parametric regression approach to measure the relationship between employment growth, hirings and separations in a large panel of German establishments over the period 1993--2009. Although it is often claimed that firms in Europe have less flexibility in their ability to hire and fire, we find that the relationship between employment growth and worker flows in German establishments is very similar to the behaviour of US establishments. The relationship is stable over time, even during the most recent economic crisis, and across different types of establishment. We verify our results with independent measures from administrative data. We suggest that this result is due to: the strong relationship between employment reductions and voluntary separations; the low level of ``churning''; and the heterogeneity of jobs within establishments."

"Increasing wage inequality between similar workers plays an important role for overall inequality trends in industrialized societies. To analyse this pattern, we incorporate directed labour market search into a dynamic model of international trade with heterogeneous firms and homogeneous workers. Wage inequality across and within firms results from their different hiring needs along their life cycles and the convexity of their adjustment costs. The interaction between wage posting and firms' growth process allows us to explain some recent empirical regularities on firm and labour market dynamics. Fitting the model to capture key features obtained from German linked employer-employee data, we investigate how falling trade costs and institutional reforms interact in shaping firm dynamics and aggregate labor market outcomes. Focusing on the period 1996-2007, we find that neither trade nor key features of the Hartz labour market reforms account for the sharp increase in residual inequality observed in the data. By contrast, inequality is highly responsive to the increase in product market competition triggered by domestic deregulation reforms."