The Dutch economy has often been heralded for accomplishing solid employment growth within a generous welfare system. Though this progress has recently been stalled, much can been learned from the Dutch model, which assumes that low-paid workers will eventually move into better jobs. In the Netherlands, this is generally the case, as low wage earners are usually young people or part-time workers. Low-paid workers are supplemented by a well-developed system of transfers to prevent them from falling into poverty.

In 2004, Germany’s unemployment rate was 10.2 percent, much higher than the euro zone average of 8.8 percent. Some policy analysts have suggested that persistently high unemployment is the result of Germany’s strong unions, high wage floors, strict employment protection laws, and generous unemployment benefits. Recently, the German government has sought to redress issues in its labor market by lowering payroll tax rates on low-wage employees.

Over the last two decades, the percentage of the French labor force engaged in low-wage work has increased significantly -- from 12 percent in 1984 to 17.7 percent in 2002. In general, low-wage employment in France does not seem to be a stepping-stone towards better paying jobs. Nevertheless, recent legislative efforts in France have targeted high unemployment, not low-wage work. The official French workweek has been reduced to 35 hours in an effort to stem unemployment, but this has led to many unintended negative consequences.

In 1994, David Card and Alan Krueger set off something of a firestorm in economics. In a study of employers in the fast food industry, they found that a minimum wage increase in New Jersey did not lead to employment cuts in the state relative to similar restaurants in nearby Pennsylvania. This defied the conventional economic wisdom, which argued that statutory increases in minimum wages would lead firms to cut costs by reducing employment. Since then, numerous economists have come forward, challenging Card and Krueger’s results using other data from New Jersey.

In 1998 and 1999, the Foundation issued an open-ended request for proposals to conduct case studies of low-wage jobs in the United States. The twelve best proposals were funded, yielding rich studies of 25 industries that employ workers at low pay. Yet none of these studies covered work in the retail sector, where 14% of the labor force is employed, many of them at low wages.

As increasing numbers of American men—particularly African-American men—serve time in prison, the issue of their successful reintegration into society after incarceration becomes more pressing. Complete reincorporation into society requires that ex-offenders find and hold a job, but employers are traditionally unwilling to hire former prisoners. With support from the Foundation, Shawn D.

Welfare reform measures of the 1990s prioritized an expedited route into the labor market for welfare dependents, claiming that employment served a valuable social and economic function. Recent analyses of state welfare-to-work programs show that 15 to 40 percent of all welfare recipients who found a job in the mid- to late-1990s were employed in the temporary help industry, raising the question of whether such jobs set workers on a trajectory towards career development and self-sufficiency, or relegate former welfare-dependents to permanent status among the working poor.