Low-wage careers: Are there dead-end firms and dead-end jobs?

Mosthaf A, Schnabel C, Stephani J (2011)

Publication Language: English

Publication Type: Journal article

Publication year: 2011

Journal

Journal for labour market research Springer

Publisher: Springer

Book Volume: 43

Pages Range: 231-249

DOI: 10.1007/s12651-010-0036-4

Abstract

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 administrative occupations. Consequently, leaving these dead-end plants and occupations appears to be an important instrument for achieving wages above the low-wage threshold.

Authors with CRIS profile

Claus Schnabel Lehrstuhl für Volkswirtschaftslehre, insbesondere Arbeitsmarkt- und Regionalpolitik Jens Stephani Lehrstuhl für Volkswirtschaftslehre, insbesondere Arbeitsmarkt- und Regionalpolitik

Related research project(s)

Löhne und Lohndifferenziale Jan. 1, 2000 - Jan. 1, 2003

Involved external institutions

Johannes Gutenberg-Universität Mainz (JGU) DE Germany (DE)

How to cite

APA:

Mosthaf, A., Schnabel, C., & Stephani, J. (2011). Low-wage careers: Are there dead-end firms and dead-end jobs? Journal for labour market research, 43, 231-249. https://dx.doi.org/10.1007/s12651-010-0036-4

MLA:

Mosthaf, Alexander, Claus Schnabel, and Jens Stephani. "Low-wage careers: Are there dead-end firms and dead-end jobs?" Journal for labour market research 43 (2011): 231-249.

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