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Youth Labor Markets in the U.S.: Shopping Around vs. Staying Put

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  • David Neumark

Abstract

The need for school-to-work programs or other means of increasing early job market stability is predicated on the view that the chaotic' nature of youth labor markets in the U.S. is costly because workers drift from one job to another without developing skills, behavior, or other characteristics that in turn lead to higher adult earnings. However, there is also ample evidence that workers receive positive returns to job shopping. This paper asks whether youths in unstable or dead-end jobs early in their careers suffer adverse labor market consequences as adults. In particular, it accounts for the endogenous determination of early job stability as a response to job match quality which may also influence adult wages using labor market conditions in the early years in the labor market as instrumental variables for the job stability experienced during those years. The instrumental variables estimates generally point to substantial positive effects of early job stability on adult wages.

Suggested Citation

  • David Neumark, 1998. "Youth Labor Markets in the U.S.: Shopping Around vs. Staying Put," NBER Working Papers 6581, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:6581
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    References listed on IDEAS

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    Cited by:

    1. Burgess, Simon & Propper, Carol & Rees, Hedley & Shearer, Arran, 2003. "The class of 1981: the effects of early career unemployment on subsequent unemployment experiences," Labour Economics, Elsevier, vol. 10(3), pages 291-309, June.
    2. H. J. Holzer & R. J. LaLonde, "undated". "Job Change and Job Stability among Less-Skilled Young Workers," Institute for Research on Poverty Discussion Papers 1191-99, University of Wisconsin Institute for Research on Poverty.
    3. Stefan Bender & Till von Wachter, 2006. "In the Right Place at the Wrong Time: The Role of Firms and Luck in Young Workers' Careers," American Economic Review, American Economic Association, vol. 96(5), pages 1679-1705, December.
    4. Raaum, Oddbjørn & Røed, Knut, 2003. "Do Business Cycle Conditions at the Time of Labour Market Entry Affect Future Unemployment?," Memorandum 12/2002, Oslo University, Department of Economics.
    5. David Neumark & Mary Joyce, 2001. "Evaluating School-to-Work Programs Using the New NLSY," Journal of Human Resources, University of Wisconsin Press, vol. 36(4), pages 666-702.
    6. Guerrazzi, Marco, 2014. "Workforce ageing and the training propensity of Italian firms: cross-sectional evidence from the INDACO survey," MPRA Paper 56826, University Library of Munich, Germany.
    7. Genda, Yuji & Kurosawa, Masako, 2001. "Transition from School to Work in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 15(4), pages 465-488, December.
    8. Tricia Lynn Gladden & Christopher R. Taber, 1999. "Wage Progression Among Less Skilled Workers," JCPR Working Papers 72, Northwestern University/University of Chicago Joint Center for Poverty Research.
    9. Burgess, Simon & Propper, Carol & Rees, Hedley & Shearer, Arran, 1999. "The class of '81: the effects of early-career unemployment on subsequent unemployment experiences," LSE Research Online Documents on Economics 6478, London School of Economics and Political Science, LSE Library.
    10. Philip Oreopoulos & Till von Wachter & Andrew Heisz, 2006. "The Short- and Long-Term Career Effects of Graduating in a Recession: Hysteresis and Heterogeneity in the Market for College Graduates," NBER Working Papers 12159, National Bureau of Economic Research, Inc.
    11. Eric French & Bhashkar Mazumder & Christopher Taber, 2005. "The changing pattern of wage growth for low skilled workers," Working Paper Series WP-05-24, Federal Reserve Bank of Chicago.
    12. Neumark, David & Rothstein, Donna, 2006. "School-to-career programs and transitions to employment and higher education," Economics of Education Review, Elsevier, vol. 25(4), pages 374-393, August.
    13. Fernando Coloma & Bernardita Vial, 2003. "Desempleo e Inactividad Juvenil en Chile," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 40(119), pages 149-171.

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    More about this item

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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