Three Essays on Contemporaneous Challenges in the Labor Market

Abstract

"This dissertation consists of three empirical essays centered on two fundamental challenges in contemporary labor markets: technological change and labor market regulations, and how these forces impact economic and health outcomes, thereby shaping inequalities. The first essay investigates how nursing scarcity in hospitals affects the provision of healthcare services and patient health. Although nurses are widely recognized as essential to hospital care (Griffiths et al., 2023, Zaranko et al., 2023), little is known about the consequences of nursing scarcity for two main reasons. First, constantly adjusting market conditions make it difficult to quantify labor scarcity. Second, endogeneity poses a challenge, as hospital quality and staffing levels influence each other simultaneously (Lin, 2014). I address both challenges by leveraging the Swiss franc stabilization in 2011, which made cross-border commuting more attractive for German registered nurses, in combination with rigid labor market regulations in the German hospital sector that prevented adjustment. Specifically, I compare German border Hospitals - affected by nurse outflows due to their proximity to Switzerland - with similar inland hospitals unaffected by this shock, using rich inpatient and hospital-level administrative data and a matched multi-period difference-in differences approach. This paper confirms the theoretical prediction from Michaillat and Saez (2015), which is grounded in the general disequilibrium model of Barro and Grossman (1971), and empirically demonstrates that labor market tightness leads to product market tightness, i.e., a reduction in the availability of healthcare services. While hospitals direct care reductions toward low-urgency cases ("triage"), older and emergency patients also experience cutbacks. Consequently, mortality rates in crease and life expectancy decreases - confirming that nurses play a vital role in improving patient health outcomes (Friedrich and Hackmann, 2021, Propper and Van Reenen, 2010). In the second essay, Sebastian Findeisen, Wolfgang Dauth, and I examine whether worker representation helps align the interests of firms and their workforce in times of technological change. We build on a literature showing that works councils possess distinct rights that enhance job protection (Jäger et al., 2022), making them poten tially decisive during automation events by forcing firms to internalize the adverse employment and wage effects on workers (Acemoglu and Lensman, 2023, Beraja and Zorzi, 2024). Using a matched multi-period difference-in-differences approach and novel data on first-time robot adoption from a German establishment survey com bined with administrative employer-employee data, we find that during automation, works councils increase worker retention, raise employment among older workers, and prevent wage cuts for routine-manual workers. Furthermore, when comparing establishments, we find that robot-adopting firms with works councils do not invest in more automation, but accompany the adoption with more training and achieve higher productivity gains post-adoption. These findings suggest that worker repre sentation may not only protect employees, but also improve firm performance during technological transformations. In the third essay, Melanie Arntz, Sebastian Findeisen, Stephan Maurer, and I broaden the scope of the economic literature - typically focused on economic out comes (Bárány and Siegel, 2020, Graetz and Michaels, 2018, Autor and Dorn, 2013) - by asking whether technological change also affects health outcomes and health inequality. Using a novel German worker-level survey linked with firm-level data and administrative records, we compare similar individuals who differ in their expo sure to workplace digitalization, using a first-differences approach. This rich dataset allows us to isolate the direct health effects of digitalization at the workplace from in direct effects, e.g., through changes in economic conditions (Abeliansky et al., 2024, Case and Deaton, 2021, Pierce and Schott, 2020, Sullivan and Wachter, 2009). We find that the increasing use of frontier digital technologies between 2011 and 2019 shifts workers toward more complex tasks that involve greater performance and time pressure. Consistent with psychological theories on "technostress" (Tarafdar et al., 2015, Bakker and Demerouti, 2007), we show that this rising digital complexity negatively impacts self-reported health and increases sick days among low-skilled workers primarily engaged in non-cognitive manual tasks. As we find no evidence of economic compensation for these workers, we conclude that digitalization introduces a new dimension of inequality by widening the health gap across skill and education groups (Currie, 2009, Meara et al., 2008)." (Author's abstract, IAB-Doku) ((en))

Cite article

Schlenker, O. (2025): Three Essays on Contemporaneous Challenges in the Labor Market. Konstanz, 176 p.