Name
Labour Leverage Effect and Employment Type
Date & Time
Tuesday, July 7, 2026, 11:55 AM - 12:20 PM
Description
Sticky wages lead to a rise in labour-induced operating leverage and bring higher equity risk. Utilizing the Japanese mandatory disclosure about the number of regular and non-regular employees, we examine the effect of employment type on labour-induced equity risk, labour leverage. The findings show the labour leverage effect is observed in regular employees, but not in non-regular employees. Furthermore, we find the labour leverage effect is weakened when the ratio of non-regular workers is high. These findings contribute to the elucidation of labour leverage mechanisms and indicate the importance of the employment type disclosure for estimating the labour leverage risk.
Speakers
Keywords
Labour leverage; Stock return volatility; Firm risk; Non-regular employees
Theme
FINANCE (OTHER)
Author 1
Junko Jinushi
Author 2
Makoto Nakano
Author 3
Yusuke Takasu