Wages, Hours, and the School-to-Work Transition: The Consequences of Leaving School in a Recession for Less-Educated Men
Abstract
Using the NLSY's weekly work history data to precisely measure labor market outcomes and the school-to-work transition, I document severe but short-lived effects of leaving school in a recession for men with 9-12 years of education. I find significant effects of entry labor market conditions on wages, job quality, and the transition time from school to work. In contrast to published evidence on more educated workers, I also find large effects on work hours on both the extensive and the intensive margins. When workers leave high school in a recession, they take substantially longer to find a job, earn lower wages, and work fewer full-time weeks and more part-time weeks. A 4-point rise in the initial unemployment rate leads to an increase in the school-to-work transition time of 9 weeks, a 16% decline in year-one average wage, a 28% fall in hours worked in the first year, and a 45% decline in first-year earnings. However, effects of entry conditions are not persistent and are largely gone after the first year.
Publication Title
B.E. Journal of Economic Analysis and Policy
Recommended Citation
Speer, J. (2016). Wages, Hours, and the School-to-Work Transition: The Consequences of Leaving School in a Recession for Less-Educated Men. B.E. Journal of Economic Analysis and Policy, 16 (1), 97-124. https://doi.org/10.1515/bejeap-2015-0054
