TY - JOUR

T1 - Impact of wages and job levels on worker absenteeism

AU - Pfeifer, Christian

PY - 2010

Y1 - 2010

N2 - PurposeThis paper seeks to analyse to what extent absolute wage levels, relative wages compared with colleagues, and the position in a firm's hierarchy affect workers' absenteeism behaviour.Design/methodology/approachThe paper uses personnel data of a large German company from January 1999 to December 2005. The data set contains 62,774 monthly observations of 1,187 full‐time white‐collar workers. Probit and Tobit models for individual monthly absenteeism are estimated.FindingsAbsenteeism is negatively correlated with absolute wages, relative wages, and hierarchical levels, which is in line with the paper's hypotheses. Moreover, the results indicate that a positive relative wage has a stronger impact than a negative relative wage, which gives rise to the issue of unequal wage structures.Research limitations/implicationsThe findings point to the relevance of interdependent preferences and status in utility functions. From the non‐linear relationship between relative wages and absenteeism it follows that an unequal wage structure has the benefit that relatively better paid workers are absent less frequenty, while the costs of higher absenteeism of workers at the lower tail of the wage distribution are rather low.Practical implicationsThe results show that not only the absolute wage level but also status‐related factors (e.g. relative wage, hierarchical level) affect employees' work effort and that unequal wage structures can be efficient to some degree.Originality/valueThe paper provides “real world” evidence from scarce personnel data for the importance of interdependent preferences and status. Furthermore, the non‐linear relationship between relative wages and absenteeism is examined.

AB - PurposeThis paper seeks to analyse to what extent absolute wage levels, relative wages compared with colleagues, and the position in a firm's hierarchy affect workers' absenteeism behaviour.Design/methodology/approachThe paper uses personnel data of a large German company from January 1999 to December 2005. The data set contains 62,774 monthly observations of 1,187 full‐time white‐collar workers. Probit and Tobit models for individual monthly absenteeism are estimated.FindingsAbsenteeism is negatively correlated with absolute wages, relative wages, and hierarchical levels, which is in line with the paper's hypotheses. Moreover, the results indicate that a positive relative wage has a stronger impact than a negative relative wage, which gives rise to the issue of unequal wage structures.Research limitations/implicationsThe findings point to the relevance of interdependent preferences and status in utility functions. From the non‐linear relationship between relative wages and absenteeism it follows that an unequal wage structure has the benefit that relatively better paid workers are absent less frequenty, while the costs of higher absenteeism of workers at the lower tail of the wage distribution are rather low.Practical implicationsThe results show that not only the absolute wage level but also status‐related factors (e.g. relative wage, hierarchical level) affect employees' work effort and that unequal wage structures can be efficient to some degree.Originality/valueThe paper provides “real world” evidence from scarce personnel data for the importance of interdependent preferences and status. Furthermore, the non‐linear relationship between relative wages and absenteeism is examined.

KW - Economics

KW - Gender and Diversity

KW - Absenteeism

KW - Germany

KW - Hierarchical organizations

KW - Pay

UR - http://www.scopus.com/inward/record.url?scp=77951482599&partnerID=8YFLogxK

U2 - 10.1108/01437721011031694

DO - 10.1108/01437721011031694

M3 - Journal articles

VL - 31

SP - 59

EP - 72

JO - International Journal of Manpower

JF - International Journal of Manpower

SN - 0143-7720

IS - 1

ER -