Length of Service and the Operation of Internal Labor Markets

This paper presents a summary of the evidence which has recently been collected concerning the role of length of service in the operation of internal labor markets. It argues that these data are inconsistent with the human capital model of the experience-earnings and experience-layoff relationships. The paper concludes by asserting that if we are ever to fully understand the role of service, newdata are needed.

Years of Service and Probability of Promotion

This study provides evidence which we believe challenges some conventional assumptions about the promotion process. Based on survey information collected from a large random sample of U.S. private sector firms, we reach two main conclusions. First,seniority independent of productivity appears to play a significant role even in nonunion promotion decisions. Second, the differences between union and nonunion promotion processes, at least with regard to the weight assigned to seniority per se, appear to be important but less dramatic than is popularly supposed.

Length of Service, Terminations and the Nature of the Employment Relationship

This paper presents new survey evidence that relative protection against job loss grows with length of service, independent of their net value to the firm. This protection makes good sense given that at most companies employees appear to earn less than their value marginal product in the early part of their tenure and more than their value marginal product in the latter part; without job protection policies for senior employees, the firm would have an incentive to terminate them when their "spot" earnings went above their "spot" value marginal product. In particular, we find that a very large percentage (over 95 percent) of hourly union members outside of agriculture and construction are covered by protective policies for senior workers and, that a somewhat smaller, but still substantial, percentage (about 85 percent) of comparable nonunion hourlies also have some protection against jobloss in their senior years. The potential reasons for these findings are briefly discussed.

Involuntary Terminations under Explicit and Implicit Employment Contracts

This study investigates where and when last-in-first-out permanent layoff policies seem to go hand in hand with compensation policies under which the net value of senior workers appears to be less than that of their junior peers. The investigation relies upon both the approximately 260 usable responses to a survey we mailed out to a sample of U.S. firms and microdata from the computerized personnel files of a major U.S. corporation. Our findings for U.S. companies outside of agriculture and construction lead us to the following three conclusions: (1) For most employees, it appears that protection against job loss grows with seniority, although net value to the firm does not.(2) While a very sizeable percentage of nonunion workers may be covered by implicit employment contracts which give more protection against termination to those with more seniority, a much higher percentage of workers covered by collective bargaining agreements seem to enjoy such protection; and (3) The job protection afforded senior nonunion personnel, especially exempt employees, appears to be less strong than that provided to union members.

Experience, Performance, and Earnings

This study provides direct evidence concerning the relationship between experience and performance among managerial and professional employees doing similar work in two major U. S. corporations. The facts presented indicate that while, within grade levels, there is a strong positive association between experience and relative earnings, there is either no association or a negative association between experience and relative rated performance. If we are correct that the performance ratings given to managerial and professional employees in any grade level adequately reflect those employees' relative productivity in the year of assessment, the results imply that the human capital on-the-job training model cannot explain a substantial part of the ob-served return to labor market experience.

Can Productive Capacity Differentials Really Explain Earnings Differentials Associated with Demographic Characteristics? Case of Experience

This study uses computerized personnel microdata on the white male managerial and professional employees at a major U.S. corporation to address the following question: Can the additional earnings which are associated with more labor market experience at a point in time really be explained by higher productivity at the same point in time? Our answer to this question, based on both cross-sectional and longitudinal information, is that performance plays a substantially smaller role in explaining cross-sectional experience-earnings differentials and earnings growth than is claimed by those who have adopted the human capital explanation of the experience-earnings profile. This response depends critically on our assumption that the performance ratings which supervisors give to their white male managerial and professional subordinates adequately reflect the subordinates' relative productivity in the year of assessment; we present a great deal of evidence which strongly supports this assumption.

Unemployment, Unsatisfied Demand for Labor, and Compensation Growth in the United States, 1956-1980

This paper presents two key facts which call into question the value of unemployment rates as barometers of labor market tightness. First, while both unemployment rates and unsatisfied labor demand proxies perform reasonably well on their own in compensation growth equations, in models which include both, only the unsatisfied demand variable appears to matter. Second, the past decade's outward shifts in Phillips plots can to a substantial degree be tied to outward shifts in plots pairing the relevant unemployment rate and unsatisfied demand proxies. The paper also provides results which indicate that Phillips relationships which are defined in terms of unsatisfied demand variables appear to be somewhat more stable than those using unemployment rates. Taken together, our findings have a clear message for those concerned with macroeconomic theory and policy: labor market pressure on wages can be more reliably assessed by looking at measures of unsatisfied labor demand than by looking at the unemployment rates on which most earlier analyses have focused.

Effects of Potassium Source and Secondary Nutrients on Potato Yield and Quality in Southcentral Alaska.

Calcium (Ca), magnesium (Mg), and sulfur (S) are required for the growth and development of all higher plants. They are commonly referred to as secondary nutrients because they are less often limiting to plant growth than the primary nutrients nitrogen (N), phosphorus (P), and potassium (K), although secondary nutrients are as critical for crop growth and development as the primary nutrients. There is limited information available concerning secondary nutrient requirements of potatoes grown in southcentral Alaska. Laughlin (1966) conducted studies between 1961 and 1963 comparing potassium chloride (KCl) and potassium sulfate (K2SO4) as potassium sources for Green Mountain potatoes, and determined the effects of varying rates of magnesium sulfate (MgSO4) and K2SO4 on Kennebec potatoes. Since these studies were conducted without irrigation and at production levels about one-half those obtained by top producers in the Matanuska Valley today, it was considered appropriate to expand upon the previous work using current production practices. Potassium was supplied as KCl and K2 SO4 to explore the need for additional S under local potato production conditions and to determine the effects of the chloride (Cl) and sulfate (SO4) anions on production and quality of potato tubers. In addition, Mg and Ca were added to determine whether the background levels of these nutrients were adequate for optimum production

Opportunity cost and prudentiality : a representative-agent model of futures clearinghouse behavior

Includes bibliographic references (p. 31-38)