Today's industrial labor market is characterized by a good deal of "structure." Long-term labor contracts, collective bargaining arrangements, seniority rules, internal promotion ladders, pension plans, and other forms of employee vesting are thought to limit the flexibility of wages, raise the natural rate of unemployment and exacerbate macroeconomic fluctuations. The same structures have been implicated in the creation of a "dual labor market" that some feel has worked to the disadvantage of an underclass of workers. Spurred by intriguing new theoretical insights on the microeconomic foundations of macroeconomic theory, a great deal of attention has recently been focused on the origins and implications of these aspects of labor market structure. This project undertakes research on the origins of the modern American labor market. Its focus will be on the critical period between 1880 and 1914. A detailed study of this period will provide an insightful contrast with recent experience and would sharpen further our understanding of macroeconomic phenomena both then and now. Data are collected from over 150 separate investigations undertaken between 1874 and 1920 by 29 state Bureaus of Labor Statistics. These bureaus published surveys of working-class families containing data on wages, hours of work, time lost to unemployment and illness, family expenditures, and a long list of other economic and social characteristics. They also published surveys of firms and other Special Reports dealing with conditions in the labor markets. Using these data from the late nineteenth and early twentieth century, the project will examine such issues as changes in labor input, the degree of wage flexibility, the heterogeneity and duration of unemployment; the pattern of age-earning profiles; changes in job tenure; the presence and importance of inter-industry wage differentials; labor productivity and short-term increasing returns to labor; and the opportunities for self-employment.
