ERIC Number: ED335186
Record Type: RIE
Publication Date: 1991-Jul
Reference Count: N/A
The Labor Market and Human Capital Investment.
Stallmann, Judith I.; And Others
This study tests the hypothesis that the local labor market structure, particularly the proportions of high- and low-paying occupations, affects human capital investment. Most studies have assumed that the direction of causation flows from the supply of human capital to employment growth. However, the creation of low-skilled jobs merely reshuffles people among unemployment lines, poverty, and low level employment. It does not improve the economic or social conditions of the community. Dependent variables in the study were the high school dropout rate and the percentage of graduates continuing their education. Independent variables include the percentage of county enrollment in occupations classified as managerial and services, the unemployment rate, the percentage of change in population, and a measure of rurality. Data from Virginia's counties and independent cities were used to estimate the human capital model. Important findings were: (1) the higher the percentage of employment in managerial occupations, the higher percentage of high school students who continue their education, and the lower the dropout rates; (2) dropout rates increase as the percentage of jobs in service occupations increase; and (3) as unemployment increases, the percentage of students who continue their education increases. The study concludes that the types, rather than the sheer number, of jobs available in the local area influence human capital investment as measured by education. Communities should actively recruit firms that have a higher percentage of workers who are rewarded for their education. (KS)
Publication Type: Reports - Research; Information Analyses; Speeches/Meeting Papers
Education Level: N/A
Authoring Institution: N/A
Identifiers: Human Capital Theory
Note: Paper presented at the Annual Meeting of the Rural Sociological Society (Columbus, OH, August 8-11, 1990).