Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/237566 
Year of Publication: 
2021
Series/Report no.: 
CERS-IE Working Papers No. CERS-IE WP - 2021/23
Publisher: 
Hungarian Academy of Sciences, Institute of Economics, Centre for Economic and Regional Studies, Budapest
Abstract: 
Low-wage jobs are often regarded as dead-ends in the labour market careers of young people. Previous research focused on disentangling to what degree the association between a low-wage job at the start of working life and limited chances of transitioning to better-paid employment is causal or spurious. Less attention has been paid to the channels that may facilitate the upward wage mobility of low-wage workers. We focus on such mechanisms, and we scrutinize the impact of social ties to higher-educated co-workers. Due to knowledge spillovers, job referrals, as well as firm-level productivity gains, having higher-educated co-workers may improve an individual's chances of transitioning to a better-paid job. We use linked employer-employee data from longitudinal Swedish registers and panel data models that incorporate measures of low-wage workers' social ties to higher-educated co-workers. Our results confirm that having social ties to higher-educated co-workers increases individual chances of transitioning to better-paid employment.
Subjects: 
co-worker networks
employer-employee data
low-wage
wage mobility
JEL: 
C23
D85
J24
J31
Document Type: 
Working Paper

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