NIESR Discussion Paper

Does socioeconomic background affect pay growth among early entrants to high-status jobs?

Young people from less advantaged backgrounds are less likely to enter a “professional” job on leaving university (Macmillan et al., 2013). However, this does not tell us about the performance of those who do. This paper considers the relative salary growth of graduates that secure a high-status job by both parental occupational status and school type, using data from a recent survey of English graduates. Using non-parametric techniques and regression modelling, I estimate the relationship between these measures of socio-economic status and pay progression in a “professional” job.

Ownership and Pay in Britain

Drawing on principal-agent perspectives on corporate governance, this paper examines whether employees’ hourly pay is linked to ownership dispersion.  Using linked workplace-worker data from the British Workplace Employment Relations Survey (WERS) 2011, we find average hourly pay is higher in dispersed ownership workplaces.  The raw gap of 30 log points falls to 8 log points when we control for differences in worker and workplace characteristics.

Intergenerational and Inter-Ethnic Well-Being: An Analysis for the UK

This paper uses a UK nationally representative data set to examine the extent to which family migration history helps explains inter-ethnic variations in subjective well-being. We confirm that there is significant variation in well-being across ethnic group and across migrant generations. On average, recent migrants appear to have higher levels of well-being.

The UK Productivity Puzzle 2008-2013: Evidence From British Businesses

In many larger advanced economies labour productivity growth slowed sharply and remained subdued for years after the credit crisis of 2007/08. Nowhere was this more obvious than in the UK. We examine the dynamics of productivity among British businesses that lie behind this stagnation. The most striking feature is the widespread weakness in total factor productivity within firms, pointing to the importance of a common factor in explaining productivity weakness.

Raising the Standard: Minimum Wages and Firm Productivity

This paper exploits the introduction of the National Minimum Wage (NMW) in Britain and subsequent increases in the NMW to identify the effects of minimum wages on productivity. We find that the NMW increased average labour costs for companies that tend to employ low paid workers, both upon the introduction of the NMW and more recently following the Great Recession when many workers experienced pay freezes or wage cuts, but the NMW continued to rise. We find evidence to suggest that companies responded to these increases in labour costs by raising labour productivity.

The UK's Productivity Puzzle

The 2008 Great Recession was notable in the UK for three things: the enormity of the output shock; the muted unemployment response; and the very slow rate of recovery.  We review the literature which finds most of the decline in productivity is within sector and within firm before presenting new micro-analysis of workplace-level behaviour between 2004 and 2011 to gain insights into the processes that may have contributed to this aggregate picture.

Does Worker Wellbeing Affect Workplace Performance?

This paper uses linked employer-employee data to investigate the relationship between employees’ subjective well-being and workplace performance in Britain. The analyses show a clear, positive and statistically-significant relationship between the average level of job satisfaction at the workplace and workplace performance. This finding is present in both cross-sectional and panel analyses and is robust to various estimation methods and model specifications. In contrast, we find no association between levels of job-related affect and workplace performance.

Has Performance Pay Increased Wage Inequality in Britain?

Using data from the British Household Panel Survey (BHPS) we show performance pay (PP) increased earnings dispersion among men and women, and to a lesser extent among full-time working women, in the decade of economic growth which ended with the recession of 2008. PP was also associated with some compression in the lower half of the wage distribution for women. The effects were predominantly associated with a broad measure of PP that included bonuses.

The School-to-Work Transtion: An Overview of Two Recent Studies

This paper summarises the findings and insights from two recent studies exploring the nature of the school to work transition in the UK. We set these papers in the context of the broader debate about the youth labour market and highlight their main contributions. This research was funded by the Nuffield Foundation.

How to Pay for the Crisis or Macroeconomic implications of pension reform

The national debt stock of the UK is rising sharply as a result of the economic crisis, and equilibrium output is falling, with the capital stock contracting. Both problems could be alleviated by the rapid introduction (but slow implementation) of a policy to extend working lives. The paper analyses a delayed extension of working lives in the UK. Increasing working lives will in equilibrium raise consumption and tax revenues and reduce pension spending. These gains by the government can be used to improve services, cut taxes or pay off debts.

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