Knowra Labor market segmentation Labor market segmentation Labor market segmentation is the division of employment into sectors with distinct wages, job security, working conditions, and paths for advancement. It explains why workers with similar skills can face unequal opportunities.
Primary and secondary labor markets : A framework dividing jobs into relatively secure, well-paid positions and less secure, lower-paid positions. This is the central distinction used to describe segmented employment.
John R. Commons : An American institutional economist who studied labor relations, collective action, and the development of employment institutions. His institutional approach helped frame labor markets as shaped by rules and organizations.
Human capital theory : An economic theory that links productivity and earnings to education, training, experience, and other acquired capacities. It emphasizes worker characteristics where segmentation emphasizes job structures and institutions.
Precarious work : Employment marked by insecurity, limited protections, unpredictable income, or weak control over working conditions. Precarious jobs often occupy the less secure side of segmented labor markets.
Internal labor market : A system in which hiring, pay, and promotion occur through rules and career ladders within an organization. Internal career ladders can protect workers while limiting access from outside jobs.
Clark Kerr : An American labor economist known for comparative studies of industrial relations and labor markets. Kerr’s work helped establish the idea that labor markets can operate as distinct institutional systems.
Competitive labor market : A labor market model in which wages adjust to supply and demand and workers can move freely between jobs. Its assumptions conflict with the barriers and persistent wage differences central to segmentation.
Informal economy : Economic activity that is not fully regulated, taxed, or protected by formal institutions. Informal work can form a distinct sector with different protections and advancement routes.
Dual labor market theory : An economic theory that explains persistent differences between primary and secondary jobs through institutional structures. It gives a formal account of why job sectors remain unequal.
Peter B. Doeringer : An American economist who studied internal labor markets and employment structures. His research connected firm-level job rules to broader labor market segmentation.
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