Colin P. Green

Flexible Contracts and Subjective Well‐Being

Theory suggests that when workers choose between permanent and flexible contracts, their utility should tend to equalize across contract types. New estimates of job satisfaction show the critical role played by unmeasured worker heterogeneity. They reveal that flexible contracts are a strong negative determinant of satisfaction with job security but are often a positive determinant of other dimensions of job satisfaction. As a consequence, flexible contracts have either a weak negative influence or no influence on overall job satisfaction. Moreover, flexible contracts generally have no impact on overall life satisfaction of the employed. These results appear broadly consistent with the presence of equalizing differences. (JEL J28, J41)

Does Performance Pay Increase Job Satisfaction

This paper investigates the influence of performance-related pay on several dimensions of job satisfaction. In cross-sectional estimates performance-related pay is associated with increased overall satisfaction, satisfaction with pay, satisfaction with job security and satisfaction with hours. It appears to be negatively associated with satisfaction with the work itself; yet, after accounting for worker fixed effects the positive associations remain and the negative association vanishes. These results appear robust to a variety of alternative specifications and support the notion that performance-related pay allows increased opportunities for worker optimization and does not generally demotivate workers or crowd out intrinsic motivation.

Are Flexible Contracts Bad for Workers? Evidence from Job Satisfaction Data

If workers can choose between permanent and flexible contracts, compensating wage differentials should arise to equalize on-the-job utility in the two types of contracts. Estimating job satisfaction using the British Household Panel Survey shows that agency and casual contracts are associated with routinely lower satisfaction. This results because the low job satisfaction associated with less job security is not offset by higher compensation or other job characteristics. Job security is sufficiently important that holding constant this one facet of satisfaction eliminates the overall gap in job satisfaction between flexible and permanent contracts.

Spatial Inequality in the Australian Youth Labour Market: The Role of Neighbourhood Composition

Andrews D., Green C. and Mangan J. (2004) Spatial inequality in the Australian youth labour market: the role of neighbourhood composition, Reg. Studies 38, 15–25. Australia has experienced a polarization of income and labour market outcomes over the past 20 years (Gregory and Hunter, 1995; Harding, 1996). This has taken an increasingly spatial dimension (Hunter, 1995a, 1995b), giving rise to concerns that the spatial pooling of disadvantage may hamper the labour market outcomes of youth growing up in poorer residential areas. This paper explores the role that the differential neighbourhood ‘quality’ of an individual’s residential area at age 16 has on their labour market outcomes at age 18 and age 21. Evidence is found that youth who live in poorer quality neighbourhoods face an increased likelihood of being unemployed at both the age of 18 and 21, even after controlling for personal and family characteristics.

Dissatisfied Union Workers: Sorting Revisited

A substantial literature argues that the reported job dissatisfaction of union members is spurious. It reflects either the sorting of dissatisfied workers into union membership or the sorting of union recognition into worse jobs. We contribute by presenting the first panel data estimates that hold constant first worker fixed effects and then worker in job fixed effects. The estimates demonstrate that covered union members typically report greater dissatisfaction even when accounting for sorting in both dimensions. At the same time, cross-sectional evidence of less satisfied covered non-members and uncovered members vanishes when accounting for sorting.

Does Raising the School Leaving Age Reduce Teacher Effort? Evidence from a Policy Experiment

This paper examines the impact of an increase in the school leaving age on high school teachers’ absence behaviour. We estimate differ- ence in difference models of absenteeism using count data approaches. Employing data from the Spanish Labour Force Survey, our findings suggest that high school teachers reduced their effort due to the re- form that raised the age of compulsory education commencing in the academic year 1998-1999 in Spain. In particular, they take 15% more sickness absence in the posttreatment period. This result should be of interest to both policy makers and researchers who rely upon com- pulsory school law changes as a source of exogenous variation in edu- cational attainment.

Profit Sharing and the Quality of Relations with the Boss

Profit sharing generates conflicting changes in the relationship between supervisors and workers. It may increase cooperation and helping effort. At the same time it can increase direct monitoring and pressure by the supervisor, and mutual monitoring and peer pressure from other workers that is transmitted through the supervisor. Using data on satisfaction with the boss, we initially show that workers under profit sharing tend to have lower satisfaction with their supervisor. Additional estimates show this is largely generated by groups of workers who would be least likely to respond to increased supervisory pressure with increase effort: women, those with dependents and those with health limitations. Despite this finding, profit sharing seems to have little or no influence on overall job satisfaction as the reduction in satisfaction with the boss is offset with increased satisfaction with earnings, a finding consistent with profit sharing enhancing productivity and earnings.

The Incidence and Consequence of Worker Displacement in Australia

This paper analyses displacement risk and its consequences for re-employment in Australia using data from the Survey of Employment and Unemployment Patterns (SEUP). We confirm overseas evidence that older workers and those from lower skill occupations are, in general, at a greater risk of displacement. By contrast, unlike US studies, no systematic link between tenure in job and displacement risk was found. Consistent with previous Australian research (Borland and McDonald, 2001) we find that males face a higher incidence of displacement than females. Decomposition of the gender difference revealed that industry effects are an important source of disparity in displacement rates. Analysis of re-employment hazards indicated that workers displaced from manufacturing faced increased periods of non-employment. Hence, it appears that there is a role for provisions to help workers in industries where the effects of structural reform have been concentrated (Kletzer, 1998).

Performance Pay, Sorting and the Dimensions of Job Satisfaction

This paper investigates the influence of performance related pay on several dimensions of job satisfaction. In cross-sectional estimates, performance related pay is associated with increased overall satisfaction, satisfaction with pay, satisfaction with job security and satisfaction with hours. It appears to be negatively associated with satisfaction with the work itself. Yet, after accounting for worker fixed-effects, the positive associations remain and the negative association vanishes. These results appear robust to a variety of alternative specifications and support the notion that performance pay allows increased opportunities for worker optimization and do not generally demotivate workers or crowd out intrinsic motivation.

Play Hard, Shirk Hard? The Effect of Bar Hours Regulation on Worker Absence

The regulation of alcohol availability has the potential to influence worker productivity. This paper uses legislative changes in bar opening hours to provide a potential quasi-natural experiment of the effect of alcohol availability on working effort, focusing on worker absenteeism. We examine two recent policy changes, one in England/Wales and one in Spain that increased and decreased opening hours respectively. We demonstrate a robust positive causal link between opening hours and absenteeism, although short-lived for Spain. The effect is long lasting for the UK where we provide evidence which suggests that increased alcohol consumption is a key mechanism.