Why some jobs command wage premiums: a test of career tournament and internal labor market hypotheses

Article Abstract:

The wage premiums associated with jobs in a large organization were identified through comparing their pay to the prevailing wages in the relevant outside labor markets. We then examined the characteristics of those jobs to investigate why some commanded larger premiums than others. Jobs at the top of promotion ladders, jobs requiring many organization-specific skills, and to a lesser extent, jobs with access to influence commanded greater wage premiums. Wages above market rates appear important in supporting the internal labor market mechanisms associated with these jobs. Findings may clarify the factors compensation managers should consider when positioning wage rates. Examination of these issues is a potentially important bridge between the study of internal labor markets in organizational research and the study of wages in economics. (Reprinted by permission of the publisher.)

Analysis, Labor market, Wages, Wages and salaries, Organizational research, Job evaluation

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Examining managerial displacement

Article Abstract:

The research reported used a longitudinal analysis to compare the displacement experience of managers with that of other employees and to examine the factors associated with managerial job loss. Job displacement occurs when employees are permanently separated from their employer when their job disappears. After controlling for individual and industry characteristics, I found that during the mid-1980s managers were actually more vulnerable to displacement than were other employees, suffering proportionately greater job loss from efforts to streamline and downsize organizations and from plant closings. (Reprinted by permission of the publisher.)

Psychological aspects, Employment, Executives, Displacement (Psychology)

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Financial consequences of employment-change decisions in major U.S. corporations

Article Abstract:

Using data from companies in the Standard & Poor's 500 between 1980 and 1994, we examined 5,479 occurrences of changes in employment in terms of two dependent variables: profitability (return on assets) and return on common stock. Firms that engaged in pure employment downsizing did not show significantly higher returns than the average companies in their own industries. However, companies that combined employment downsizing with asset restructuring generated higher returns on assets and stock returns in their own industries. (Reprinted by permission of the publisher.)

Prices and rates, Stocks, Profit, Profits, Human resource management, Management research, Stock prices

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