Shweta Bahl, Vasavi Bhatt and Ajay Sharma
In the process of school-to-work transition, the role of general education and vocational education and training (VET) remains quite central. Based on the human capital theory, we…
Abstract
Purpose
In the process of school-to-work transition, the role of general education and vocational education and training (VET) remains quite central. Based on the human capital theory, we estimate whether investment in VET brings additional returns for workers across the age cohorts.
Design/methodology/approach
The focus of our study being the labour market in India, the data from the Periodic Labour Force Survey 2018–19, conducted by the National Statistical Office, has been used for analysis. We have applied the ordinary least square method with sample selection correction, the quasi-experimental technique of propensity score matching and heteroskedasticity based instrumental variable approach to estimate the returns with respect to no VET, formal VET and informal VET.
Findings
Our study shows that workers with formal VET earn higher wages than workers with no VET or informal VET. The study finds that workers with informal VET do not earn higher wages than workers with no VET. Moreover, from the age cohort analysis, we have deduced that wage advantage of workers with formal VET persists across all age cohorts and, in fact, accentuates with an increase in age.
Originality/value
We have estimated that VET being complemented with basic general education fetches higher returns in the labour market, especially when provided through formal channels. Moreover, to the best of our knowledge, in the case of developing countries where informal VET is widely provided, this is one of the first studies that captures the return to informal VET. Lastly, complementing the existing studies on the developed countries, we have estimated the returns to VET over the life cycle of the workers.
Details
Keywords
V.P. Priyesh and Lukose P.J. Jijo
This study examines the earnings quality of private-subsidiary firms using a large sample data from India.
Abstract
Purpose
This study examines the earnings quality of private-subsidiary firms using a large sample data from India.
Design/methodology/approach
The impact of parent–subsidiary relationship on earnings quality is examined using two common proxies. Findings are robust to alternative research designs, including different earnings quality proxies, endogeneity and matching techniques.
Findings
The study finds that private firms that are subsidiaries of listed firms tend to have lesser (greater) earnings quality (manipulation). Further, the study reports that this relationship is more pronounced when the parent firm is relatively larger than the subsidiaries. The study finds no evidence that Big 4 affiliation of the parent company improves earnings quality among private subsidiaries; instead, it exacerbates earnings manipulation in some cases. Finally, the authors document that subsidiary firms use tax management, as proxied by book tax differences, to engage in income-increasing earnings manipulation.
Research limitations/implications
This study examines how affiliation with a listed entity as a subsidiary impacts the earnings quality of private companies. Future research could investigate the financial reporting practices of both private subsidiary firms and standalone private firms, comparing them in similar or differing regulatory environments across various countries.
Practical implications
The findings of this study will help investors, bankers, creditors and regulators to understand the financial reporting of private firms. The study calls for enhanced audit quality at the subsidiary level by making the auditor of the parent firm responsible for auditing a subsidiary, a practice that is currently absent in India.
Originality/value
The results contribute to the existing debate on how firms manage earnings using data of private firms in a large emerging market setting. Previous research has not paid enough attention to the earnings quality of private subsidiaries. The study also emphasizes the necessity for a more robust system of governance and supervision for private firms, particularly in India and generally in other countries.
Details
Keywords
This study examines the impact of caste on salary levels and job positions within Kerala’s Information Technology sector, aiming to challenge the meritocratic perception of this…
Abstract
Purpose
This study examines the impact of caste on salary levels and job positions within Kerala’s Information Technology sector, aiming to challenge the meritocratic perception of this critical area for India’s economic growth.
Design/methodology/approach
The study utilises a dataset of 24,590 employees from 21 IT firms, classified by ownership into Indian and foreign firms. Caste-based disparities are analysed by identifying employees with upper-caste surnames and distinguishing between Kerala Upper Caste and non-Kerala Upper Caste. Generalised Linear Model (GLM) are used to quantify salary disparities and provide deeper insights into how caste, gender and ownership influence salaries.
Findings
The findings reveal significant wage gaps, with individuals bearing upper-caste surnames earning more than their non-upper-caste counterparts, especially in Indian-owned firms. Kerala Upper Caste employees enjoy a salary premium, which is reduced in foreign-owned firms. Moreover, upper-caste individuals are likelier to hold senior roles, indicating potential barriers for non-upper-caste employees.
Research limitations/implications
These results highlight the need for targeted policies to address caste-based inequalities, promoting inclusiveness and fairness in the IT workplace. Wage-setting practices and promotion criteria, particularly the recent trend of employee recommendations for recruitment, may risk amplifying existing disparities if not carefully managed. Industry leaders must recognise and mitigate these risks to ensure equitable employment practices. Limitation: The study’s reliance on surname-based caste identification may underestimate the extent of caste disparities. Further, the absence of additional human capital controls, and focus on Kerala limit the generalizability of findings.
Originality/value
This study is the first to analyse caste dynamics within the IT sector using a rich dataset of corporate firms and wages, offering a novel methodological approach to understanding how social identity intersects with economic outcomes.
Details
Keywords
Francesco Pastore and Misbah Tanveer Choudhry
This is Part 1 of the two special issues on the topic, “School to work transition around the world – the effect of the pandemic recession.” The first part focuses on the…
Abstract
Purpose
This is Part 1 of the two special issues on the topic, “School to work transition around the world – the effect of the pandemic recession.” The first part focuses on the determinants of the school-to-work transition (STWT) and the implications of the COVID-19 pandemic on the young worker and their response to uncertain labor market conditions. The second issue will explore the country-specific experiences around the globe in tackling the problem of a smooth STWT. The purpose of this introductory article is to elaborate on the transition of young workers in the labor market. Discussion on the status of various indicators of the youth labor market (unemployment, underemployment and not in employment, education and training [NEET]) is also integrated. The determining factors of school-to-work transition (STWT) and the role of technical and vocational institutions and universities are analyzed. Moreover, the impact of COVID-19 on the labor market is also evaluated. After the pandemic, there was a dreadful change in the job market; this study dives into those diverse factors and carves out the multiple impacts on youth unemployment.
Design/methodology/approach
The study analyses relevant literature on STWT, NEET and COVID-19 implications for the labor market, based on the other papers in this special issue. Using the review method, the authors identified similar research articles and reports which helped in strengthening the study’s argument. The primary focus of the study was on the smooth transition of young workers in the labor market and the impact of the pandemic on youth unemployment. Hence, literature supported the authors in giving the justifications from various economies and societies.
Findings
The paper finds that youth worldwide have suffered from the repercussions of COVID-19, especially in their early career (STWT). Skill mismatch, underemployment, job losses, salary cut downs, health issues, vocational education importance, vulnerable employment, etc. were some of the significant impacts the authors identified by analyzing the various reports and papers. Furthermore, this paper also discusses the role of active labor market policies and hiring incentives for promoting youth employment.
Social implications
The paper finds that the times ahead are challenging ones. There is a dearth of productive job opportunities due to slow economic growth. The unemployment rate among youth and adults is high, and labor markets have become more competitive. The young generation is now left with no choice but to upgrade and improve their skill set or some other expertise. On the one hand, technical and vocational education and training (TVET) and universities need to enhance their marketable knowledge and skills, and on the other hand, there is a need for active labor market policies to encourage their participation in the labor markets.
Originality/value
This paper strongly contributes to highlighting the professional and societal hit backs faced due to the aftermath of COVID-19. The study summarizes the specific details of STWT and employment issues faced by youth in various parts of the world.