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01/23/95

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When jobs move, can workers follow?

STANFORD -- When a firm relocates - to another country, another city or simply across town - the effects on its employees can be profound. For the past three decades, social scientists have studied the impact on inner-city minority workers when their employers move their firms to mostly white suburbs, a condition scholars call "spatial mismatch."

Roberto M. Fernandez, professor of organizational behavior, told a Chicago audience shortly after joining the Business School faculty in September that, "stated most simply, the spatial mismatch hypothesis argues that limitations on the residential choices of minorities, particularly the almost total exclusion of African Americans from white suburban areas, inhibit minority access to jobs - especially low-skill jobs, which have been steadily dispersing from central cities to the suburbs of most metropolitan areas for the past 30 years. The best evidence in this area suggests that spatial mismatch has significant impacts on minority employment."

Fernandez is studying the effects of a move by a food- processing plant from Milwaukee's central business district to an outlying suburb. The firm decided to relocate to a new, custom-built plant in order to accommodate new machinery. It had no hidden agenda of shedding its minority workers and, in fact, chose as its new site one it believed most convenient for all its employees. This is a best-case scenario of an inner-city firm relocating to the suburbs, says Fernandez, as the company figures to be supportive of public policy that helps its minority workers make the move - of plans to improve transportation from the city, for example, or to break down residential segregation in the suburbs.

The plant employs 142 salaried workers and 195 hourly production employees. "The hourly jobs in the current plant are precisely the kinds of industrial jobs that are disappearing from the U.S. economy," Fernandez writes in a recent issue of Economic Geography. "They require relatively little education, yet pay enough to support a family." More than half of the hourly workers are minorities: 43 percent are black; 12 percent, Hispanic; and 1 percent, Native American.

Before the firm moved in 1993, Fernandez and his assistants surveyed 279 of the plant's 337 employees in hour-long, face-to-face interviews and collected demographic data on the employees from other sources. Fernandez plotted the distance and length of commuting time to both old and new sites for each employee. Then, using a simple model, he estimated the dollar value of increased commuting time. First findings clearly indicate differences in spatial disruption experienced by male and female workers and by employees of different races.

"Whether we focus on distance, travel times or time values, the plant's move to the suburbs will have a disproportionately negative impact on minority males and white and black women," he writes. "Without question, job accessibility is deteriorating for these workers because of the plant's relocation."

How much it is deteriorating and how minority and women employees will react is yet to be seen. The information collected so far will provide a baseline for follow-up interviews approximately one year after the move. Unlike most previous research on spatial mismatch, Fernandez's study will track the employees who leave the firm, as well as those who stay. "I will examine whether those who quit fare better or worse than those who remain with the firm, and determine whether minorities are more likely to quit than whites." Fernandez also will measure how factors such as spouse's employment, attachment to the neighborhood and having children in school affect both those who stay with the firm and those who leave.

Other research

Fernandez has a long-standing interest in organizational change and its impact on individuals. Besides his continuing study of spatial mismatch, Fernandez has conducted research into the relationship of diversity in the workplace to the employee's commitment to the organization and into the effects of gender and class on social isolation. In a particularly timely study published last year in the American Journal of Sociology, he and Roger V. Gould of the University of Chicago used data from the Carter administration to examine the influence of government as a broker in health care. They found that the influence of policymakers seems to fade as their commitment increases.

"The result is a paradox of state power," say Fernandez and Gould. When government agents try to advance a specific goal, they surrender their influence. The researchers' findings suggest "a sobering consideration regarding the implications of government-led health care reform."

Fernandez, a graduate of Harvard who earned his master's and doctoral degrees from the University of Chicago, moved to the Business School from Northwestern University's department of sociology. At Stanford, Fernandez is a professor of organizational behavior and the James and Doris McNamara Faculty Fellow for 1994-95.

  • * *

"Race, Space, and Job Accessibility: Evidence from a Plant Relocation," Roberto M. Fernandez, Economic Geography, vol. 70 (October 1994)

"A Dilemma of State Power: Brokerage and Influence in the National Health Policy Domain," Roberto M. Fernandez and Roger V. Gould, American Journal of Sociology, vol. 99, no. 6 (May 1994)

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