The objective of the article is to evaluate the impact of personnel costs on apparent labour productivity by employing the 1995-2018 panel data of the manufacturing industry in 27 European countries. The methods of independent samples t-test, correlation analysis, Granger causality test, unit...

According to empirical studies, a statistically significant factor for German exports success is high cost (or price) competitiveness. Studies by Deutsche Bundesbank recommend correcting the nominal effective exchange rate by broad cost (or price) indicators (Deutsche Bundesbank, 1998, 2016a)....

In 2016, the Irish minimum wage increased from €8.65 to €9.15 per hour. A new ESRI study, funded by the Low Pay Commission, found that the 2016 minimum wage increase led to higher labour costs among firms with more than half of their employees on the minimum wage. However, these types of...

This study develops alternative quarterly measures of labor costs that refine the published data on hourly earnings and hourly compensation for the period 1953-1978. These new series account for deviations of hours paid for from hours worked, for the tax treatment of wages under the corporate...

This paper documents the increase in the use of lump-sum payments and profit sharing plans in union contracts in the 1980s, and evaluates the extent to which these innovations may have contributed to moderation in the growth of labor costs, and increased pay flexibility. We find evidence that...

We provide novel systematic cross-country evidence that the link between domestic labour markets and CPI inflation has weakened considerably in advanced economies during recent decades. The central estimate is that the short-run pass-through from domestic labour cost changes to core CPI...

We provide novel systematic cross-country evidence that the link between domestic labour markets and CPI inflation has weakened considerably in advanced economies during recent decades. The central estimate is that the short-run pass-through from domestic labour cost changes to core CPI...

This paper studies simple partial equilibrium models of dynamic labor demand, under certainty. Labor turnover costs may or may not decrease the firm's average labor demand, depending on the form of the revenue function, on the rates of discount and of labor attrition, and on the relative size of...

We propose a theory of gig economies in which workers participate in a shared labor pool utilized by multiple firms. Since firms share the same pool of workers, they face a trade-off in setting pay rates; high pay rates are necessary to maintain a large worker pool and thus reduce the likelihood...

West Germany's Employment Promotion Act of 1985 facilitated the use of fixed term contracts and increased the number of dismissals above which the employer is required to establish a 'social plan' (involving severance payments). The effect of this reduction in 'firing costs' on movements in...

Labor costs in China have been increasing dramatically in recent years, spurring worries that the country may lose its comparative advantage in manufacturing and its role as the “World’s Factory”. This paper aims to evaluate the effects of rising labor costs on China’s attractiveness to...

Despite unambiguous predictions of the canonical model of a competitive labor market, empirical studies on the labor market effects of payroll taxation provide conflicting evidence. Our meta-analysis shows that varying degrees of labor market competitiveness across places and time could be one...

The recent development in the Slovak economy erased a significant competitive advantage of manufacturing - low labour cost. The paper analyses the driving factors of rising unit labour costs in the manufacturing sector. The paper aims to explain why the unexpectedly rapid loss of traditional...

Das Jahr 2020 stand in Europa im Zeichen der Coronakrise. Die Wirtschaftsleistung brach europaweit in einem noch nie dagewesen Ausmaß ein. Durch an die Krisensituation angepasste und neue Beschäftigungssicherungsprogramme konnte jedoch in den Ländern der Europäischen Union im großen Umfang...

The link between US labor cost and price inflation has weakened notably over the past three decades. In this paper we document this decline and analyse potential contributing factors. We consider four important trends that have shaped the US economy of late: (i) improved anchoring of inflation...

We provide novel systematic cross-country evidence that the link between domestic labour markets and CPI inflation has weakened considerably in advanced economies during recent decades. The central estimate is that the short-run pass-through from domestic labour cost changes to core CPI...

This paper estimates the effect of payroll tax cuts on firm-level employment and balance-sheet outcomes during economic downturns. We use two regional payroll tax cuts in Finland as well as the onset of the Great Recession to estimate the effect of the recession on firms treated by the payroll...

This paper examines the effectiveness of labor cost reductions as a means to stimulate economic activity and assesses the differences which may occur with the prevailing exchange rate regime. We develop a medium-scale three-region DSGE model and show that the impact of a cut in employers' social...

In 2016, the Irish minimum wage increased from €8.65 to €9.15 per hour. A new ESRI study, funded by the Low Pay Commission, found that the 2016 minimum wage increase led to higher labour costs among firms with more than half of their employees on the minimum wage. However, these types of...

This study is a theoretical and empirical analysis of the effects of time and money costs of labor market participation on married women's supply behavior. The existence of fixed costs implies that individuals are not willing to work less than some minimum number of hours, termed reservation...

This paper documents the high level of job security protection in Latin American labor markets and analyzes its impact on employment. We show that job security policies have substantial impact on the level and the distribution of employment in Latin America. They reduce employment and promote...

In this paper I use data from a survey of firms to estimate the effects of a firm's wage level on several measures of its hiring costs and the characteristics and performance of its employees. These measures include the previous experience and current tenure of its employees; subjective...

Higher labor costs (higher wage rates and employee benefits) make workers better off, but they can reduce companies' profits, the number of jobs, and the hours each person works. The minimum wage, overtime pay, payroll taxes, and hiring subsidies are just a few of the policies that affect labor...

Die Arbeitskosten je geleistete Arbeitsstunde sind ein wichtiger Indikator zur Beurteilung der internationalen Wettbewerbsfähigkeit von Volkswirtschaften. Sie können durch wirtschaftspolitische und betriebswirtschaftliche Maßnahmen auch kurzfristig beeinflusst werden, um die...

Nach einem Jahrzehnt der sehr schwachen Lohnentwicklung in den 2000er Jahren, waren die 2010er Jahre ein Jahrzehnt in dem sich die Arbeits- und Lohnstückkostenentwicklung in Deutschland normalisiert hat. Die dynamischere Lohnentwicklung und das annähernde Ausschöpfen des...

Labor adjustment costs (LACs) are a broad concept and involve costs incurred to search, hire, train, retain, and fire employees. LACs represent a substantial financial burden for firms, and increase with their reliance on skilled labor for production and operation. In this study, I examine...

The importance of skilled labor and the inalienability of human capital expose firms to the risk of losing talent in critical times. Using Swedish micro-data, we document that firms lose workers with the highest cognitive and noncognitive skills as they approach bankruptcy. In a...

The US-centred debate on the decoupling of productivity from workers' compensation has given rise to the question whether this decoupling has also taken place in other countries, and if so, to what degree. However, in-depth analyses of the extent and the underlying causes of wage-productivity...

In many countries, labor courts play a central role in the determination of firing costs by monitoring and supervising the procedures for dismissals, and, eventually, deciding severance payments mandated by the employment protection legislation (EPL). To get some insights about the impact of...

Over the 1967-2015 period, net wage inequality has decreased in France by 25%, in contrast to the significant increase experienced by most developed countries. Less well known is the fact that labor cost inequality has actually increased by 8% over the same period. We show that, (a) standard...

Nach einem Jahrzehnt der sehr schwachen Lohnentwicklung in den 2000er Jahren, waren die 2010er Jahre ein Jahrzehnt in dem sich die Arbeits- und Lohnstückkostenentwicklung in Deutschland normalisiert hat. Die dynamischere Lohnentwicklung und das annähernde Ausschöpfen des...

Die Arbeitskosten je geleistete Arbeitsstunde sind ein wichtiger Indikator zur Beurteilung der internationalen Wettbewerbsfähigkeit von Volkswirtschaften. Sie können durch wirtschaftspolitische und betriebswirtschaftliche Maßnahmen auch kurzfristig beeinflusst werden, um die...

Several studies have highlighted that African manufacturing wages are higher than comparator countries at similar levels of development, which contributes to the continent’s lower levels of manufacturing competitiveness. This paper derives unit labor costs - average wages relative to...

I study the effect of increasing competition on financial performance through labour leverage. To capture competition, I exploit variation in product market contestability in the U.S. airline industry. First, I find that increasing competitive pressure leads to increasing labour leverage,...

I study the effect of increasing competition on financial performance through labor leverage. To capture competition, I exploit variation in product market contestability in the U.S. airline industry. First, I find that increasing competitive pressure leads to increasesing labor leverage,...

I study the impact of M&As on labor market outcomes of employees in target firms. Using a matched employer-employee dataset linked with hand-collected data on M&A activity in Brazil, I estimate the magnitudes of employee costs and document the underlying sources of earnings changes in the...

The recovery of private investment in Italy has lagged its euro area peers over the past decade. This paper examines the role of elevated labor costs in hindering the recovery. Specifically, labor costs rose faster than labor productivity prior to the global financial crisis and have remained...