Research project TA/00/46 (Research action TA)
The aim of the project is to assess the situation of groups among the population known for being confronted to labour-market barriers, which display low employment rates, high unemployment rates and a higher-than-average risk of poverty due to wage inequality. These groups comprise, among others, older women, low-educated individuals and residents of non-EU origin. More precisely, the objectives of this project is to assess their situation in terms of i) wage discrimination, ii) employability and iii) relative wages.
Researchers will also try to deploy a robust firm-level analysis of the relationship between human capital (formal education, company-based training...) and the productivity, employability and wages of employees, in particular those belonging to the above-listed at-risk groups.
The core of methodology mobilised in this project will consist of estimating different productivity and wage/labour cost equations at the firm level (for the Belgian private sector) expanded by the specification of a labour-quality index à la Hellerstein et al. (1999) reflecting the heterogeneity of firms’ workforce, using panel data.
This methodology is suitable for analysing a wide range of workers’ characteristics, such as ethnic origin, education, gender or age and assess the three above-mentioned problems that can be associated with these traits, namely a lack of employability, wage discrimination or/and low earnings.
From an econometric perspective, researchers will rely on up-to-date econometric estimation methods allowing notably controlling for firm fixed effects and potential endogeneity issues. Hence, they will use estimation techniques that have been developed for dynamic panels or more structural approaches relying on information on intermediate inputs of firms.
Researchers will provide econometric estimates, publishable in peer-reviewed international scientific journals, regarding the configuration and determinants of firms’ productivity, of employment obstacles faced by low educated individuals, older women or residents of non-EU origin.
Researchers will provide results (using firm-level data) enabling to evaluate:
a) The role of inter-firm differences in productivity to explain wage inequality and poverty.
b) The employability of those belonging to above-listed at-risk groups.
c) Wage discrimination against workers of the above-listed at-risk groups.
d) The importance of human capital (education, training...) to enhance productivity and employability.
