Wage Determinants and Age Profiles in the Okinawa's Child Care Industry: Evidence from Employee-level Data (in Japanese)

Satoshi Shimizutani and Haruko Noguchi

ESRI Discussion paper series from Economic and Social Research Institute (ESRI)

Abstract: It is not well known that Okinawa suffers from a severe shortage of child care services, even among non-urban areas in Japan. This study is the first micro-level examination of wage determinants of child care workers in Okinawa. We focus especially on two issues, which motivate us to draw important policy implications. (1) The wage-age profile for regular workers in public centers is very steep, while that for workers in private and licensed centers has not yet been revealed. What accounts for the difference, if any, in the profiles except for regular workers in public facilities? Is the difference in the steepness justified by human capital theory? We could draw a strategy to improve efficiency in licensed centers, which are dominant in Japan. (2) The wage determinants for workers in non-licensed centers have not been uncovered . Is the nonprofit wage premium observed between private-licensed (nonprofit) and non-licensed (for-profit)? Thus, we obtain a clue for the entry policy for for-profits. First, our empirical findings demonstrate that the wage-age profile in private and licensed centers is much less steep than that in public centers, which is applicable for general officials. However, even in the public facilities, the profiles have different steepnesses between regular and non-regular workers despite the fact that there is no natural distinction in jobs. Thus, we cannot justify the steep wage curve for regular workers in public centers. Second, we observe a nonprofit wage premium between private-licensed and non-licensed centers. Difference in management, rather than any factors associated with human capital, contributes to widen the wage differentials. In sum, though we observe large wage differentials in child care workers by type of management, the determinants are not necessarily associated with human capital, which casts doubt on the differences that could be explained by those in quality of child care.

Pages: 34 pages
Date: 2004-04
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