DEAD-END JOBS OR STEPPING STONES? THE LONG-RUN CONSEQUENCES OF EARLY INDUSTRY AND OCCUPATION

Dead-end jobs can be defined as a line of work in one’s early work history that leads to lower long-run wages. This study shows how early lines of work predict long-run worker wages and finds that there are significant differences in this relationship based on the skill level of the worker. In general, service-producing lines of work appear to penalize long-run wages, especially for low-skilled workers. Low-skilled workers in retail food/foodservice lines of work rank about in the middle of the spectrum between dead-end jobs and stepping stones. Long-run wage potential is better in retail food/foodservice than in manufacturing/operative jobs. On the other hand, early experience in retail food/foodservice leads to lower long-run wages, all else equal, compared to early experience in a professional services industry (other than health) and a non-business professional occupation. Overall, this research provides evidence that early line of work matters to a worker’s long run wages at all skill levels; there is little difference between men and women. These results are based on analyzing data from the National Longitudinal Survey of Youth, 1979.