Journal of Economics and Finance

, Volume 34, Issue 2, pp 142–149 | Cite as

Unemployment and compensating wages: an analysis of shift work

  • Ronald DeBeaumontEmail author
  • Christian Nsiah


Compensating wages have been documented for a number of job attributes including working non-standard hours. Using data that aggregates across occupations, our analysis confirms a wage premium for working night shifts. However, the compensating wage is greater in areas where unemployment is low, suggesting that employers are less pressured to compensate for night shifts when employment opportunities are relatively scarce. If this result holds for other undesirable work characteristics, such as risk of death on the job, then weak labor markets will have lower compensating wages in general.


Shift Work Compensating Wages 

JEL codes



  1. Anargson, S. (1998) Who Works Shifts? An Analysis of the Characteristics of Male Shift Workers in Sweden. In: Of Men and Machines: Essays in Applied Labour and Production Economics. Dept. of Economics, Goteborg University, GoteborgGoogle Scholar
  2. Black DA, Kniesner TK (2003) On the measurement of job risk in hedonic wage models. J Risk Uncertain 27:205–220CrossRefGoogle Scholar
  3. Boushey H (2002) Reworking the wage curve: exploring the consistency of the model across time, space and demographic group. Rev Polit Econ 14(3):293–311CrossRefGoogle Scholar
  4. Daniel C, Sofer C (1998) Bargaining, compensating wage differentials, and dualism of the labor market: theory and evidence for france. J Labor Econ 16:546–575CrossRefGoogle Scholar
  5. French M, Dunlap L (1998) Compensating wage differentials for job stress. Appl Econ 30:1067–1075CrossRefGoogle Scholar
  6. Froot KA (1989) Consistent covariance matrix estimation with cross-sectional dependence and heteroskedasticity in financial data. J Financ Quant Anal 24:333–355CrossRefGoogle Scholar
  7. Hersch J (1998) Compensating wage differentials for gender-specific job injury risks. Am Econ Rev 88(3):598–607Google Scholar
  8. Hotchkiss JL, Pitts MM (2007) Evidence of Demand Factors in the Determination of the Labor Market Intermittency Penalty. Federal Reserve Bank of Atlanta Working Paper #2007-16:1–22Google Scholar
  9. Hoxby CM (2005) Competition among Public Schools: A Reply to Rothstein (2004). NBER Working Paper #11216. National Bureau of Economic Research, Cambridge, MA 02138Google Scholar
  10. Kandil M, Woods JG (2002) Convergence of the gender gap over the business cycle: a sectoral investigation. J Econ Bus 54(3):271–292CrossRefGoogle Scholar
  11. Kostiuk PF (1990) Compensating differentials for shift work. J Polit Econ 98(5):1054–1075CrossRefGoogle Scholar
  12. Lanfranchi J, Ohlsson H, Skalli A (2002) Compensating wage differentials and shift work preferences. Econ Lett 74:393–398CrossRefGoogle Scholar
  13. Magnani E (2002) Product market variability and the adjustment of earnings to risk. Ind Relat 41(2):304–328CrossRefGoogle Scholar
  14. Mayshar J, Solon G (1993) Shift work and the business cycle. Am Econ Rev 83(2):224–228Google Scholar
  15. Moretti E (2000) Do wages compensate for risk of unemployment? Parametric and semiparametric evidence from seasonal jobs. J Risk Uncertain 20(1):45–66CrossRefGoogle Scholar
  16. Moulton BR (1990) An illustration of a pitfall in estimating the effects of aggregate variables on micro units. Rev Econ Stat 72(2):334–338CrossRefGoogle Scholar
  17. Rosen, S. (1986) The Theory of Equalizing Differences. Handbook of Labor Economics 1: 641–692. Edited by Orley Ashenfelter and Richard Layard. Amsterdam: North-HollandGoogle Scholar
  18. Schumacher EJ, Hirsch BT (1997) Compensating differentials and unmeasured ability in the labor market for nurses: Why do hospitals pay more? Ind Labor Relat Rev 50(4):557–579CrossRefGoogle Scholar
  19. Williams RL (2000) A note on robust errors in cluster-correlated data. Biometrics 56:645–646CrossRefGoogle Scholar
  20. Viscusi WK, Aldy JE (2003) The value of a statistical life: a critical review of the market estimates throughout the world. J Risk Uncertain 27:5–76CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC 2009

Authors and Affiliations

  1. 1.College of Business and TechnologyBlack Hills State UniversitySpearfishUSA

Personalised recommendations