Alicia Sasser Modestino is an associate professor with appointments in the School of Public Policy and Urban Affairs and the Department of Economics at Northeastern University. Since 2015 she has also served as the associate director of the Dukakis Center for Urban and Regional Policy and is currently a nonresident fellow in the Brookings Metropolitan Policy Program. Previously, Modestino was a senior economist at the Federal Reserve Bank of Boston where she lead numerous research projects on regional economic and policy issues for the New England Public Policy Center.
Modestino’s current research focuses on labor market dynamics including youth labor market attachment, skills mismatch, migration, and the impact of health care reform on employers. Her work has been funded by the William T. Grant Foundation, the Russell Sage Foundation, and the National Science Foundation and has been published in peer-reviewed publications including Journal of Human Resources, Labour Economics, Health Affairs, and Regional Science and Urban Economics. Modestino holds both a master’s degree and a Ph.D. in economics from Harvard University, where she also served as a doctoral fellow in the Inequality and Social Policy Program at the Kennedy School of Government.
Areas of Expertise (3)
Inequality and Social Policy Fellowship (professional)
Harvard University, 2000-2001
Doctoral Fellow (professional)
Weiner Center for Social Policy, Kennedy School of Government, 1999-2001
National Science Foundation Graduate Studies Fellowship (professional)
College Prize for Excellence in Economics (professional)
Boston University, 1993
Sumner Slichter Harvard University Fellowship for Study in Labor Economics (professional)
Harold C. Case Scholarship (professional)
Boston University, 1992
Harvard University Graduate Studies Fellowship (professional)
Robert F. Bruce Memorial Prize in Mathematics (professional)
Boston University, 1993
Harvard University: Ph.D., Economics 2001
Harvard University: A.M., Economics 2000
Boston University: B.A., Mathematics and Economics 1993
magna cum laude
- American Economic Association (AEA)
- Society of Labor Economists (SOLE)
- American Society of Health Economists (ASHEcon)
- Committee on the Status of Women in the Economics Profession (CSWEP)
- Association for Public Policy Analysis and Management (APPAM)
Media Appearances (5)
Let’s invest in summer jobs programs to maximize their impact
The Brookings Institution online
Around the country this month, mayors’ offices are deep into planning for their 2018 summer jobs programs. These programs provide work opportunities, most of them publicly subsidized, to hundreds of thousands of teens and young adults who might otherwise struggle to find jobs. They are often a jurisdiction’s largest and highest-profile youth initiative.
Will a falling stock market take the job market along with it on the way down?
NBC News online
A week ago, economists were cheered to see steady job growth and higher wage growth — but some now fear workers’ gains could be undermined by Wall Street’s gyrations.
Development is bringing a sea change to Lynn
The Boston Globe online
For decades, stretches of prime waterfront property remained vacant in Lynn. From high-tension electrical wires that restricted access along the ...
Bitcoin, Wage Stagnation, and Geopolitics: the Global Economy in 2018
News @ Northeastern print
Bitcoin’s bubble could burst in 2018, according to Northeastern associate professor Alicia Sasser Modestino, a labor market expert in the College of Social Sciences and Humanities. “For many economists,” she says, “the question is not whether the bubble will burst but when.” Here’s what else she foresees for the economy in the new year.
Overlooked workers are finding it easier to land jobs
The Boston Globe online
As Northeastern University economist Alicia Sasser Modestino puts it: “We have gone through all the easy-to-employ people, and we're down ...
Research Grants (5)
A Multi-Year Evaluation of Boston Summer Youth Employment Program Features to Reduce Inequality Across Groups.
William T. Grant Foundation Research Grant $280,714
Principal Investigator. July 2016-June 2019.
Increasing Qualified Cybersecurity Educators: Market Study on Shortages of Educators.
National Security Administration $150,000
Co-Principal Investigator (with Agnes Chan, CCIS). May 2017-December 2017.
Technical Assistance for Social Innovation Fund Pay for Success Project for the Boston Summer Youth Employment Program.
Third Sector Partners $250,000
Co-Principal Investigator (with Trinh Nguyen, City of Boston), December 2016-August 2017.
Upskilling: Why Do Employers Demand Greater Skill When Workers Are Plentiful?
Russell Sage Foundation $35,000
Contact Co-Principal Investigator, (with Daniel Shoag), January 2016-December 2017.
Citi Community Development Concept Proposal: Youth Credit Building Initiative.
Citi Community Development Foundation $260,750
Co-Principal Investigator (with Trinh Nguyen, City of Boston), January 2016-December 2017.
Summer youth employment programs (SYEPs) have become increasingly popular in cities and counties across the country, and are effective in reducing crime and incarceration among participants, according to recent evaluations. However, less is known about how they achieve these impacts, and which participants benefit the most. With more information about which program elements are the most effective, places can do more to ensure quality as they expand or launch programs.
Modestino, A., Shoag, D., and Ballance, J.
Using a novel database of 82.5 million online job postings, we show that employer skill requirements fell as the labor market improved from 2010 to 2014. We find that a 1 percentage point reduction in the local unemployment rate is associated with a roughly 0.27 percentage point reduction in the fraction of jobs requiring at least a bachelor's degree and a roughly 0.23 percentage point reduction in the fraction requiring five or more years of experience. This pattern is established using multiple measures of labor availability, is bolstered by similar trends along heretofore un-measured dimensions of skill, and even occurs within firm–job title pairs. We further confirm the causal effect of labor market tightening on skill requirements using a natural experiment based on the fracking boom in the United States, as an exogenous shock to the local labor supply in tradable, non-fracking industries. These industries are not plausibly affected by local demand shocks or natural gas extraction technology, but still show fewer skill requirements in response to tighter labor markets. Our results imply this labor market-induced downskilling reversed much of the cyclical increase in education and experience requirements that occurred during the Great Recession.
Globalization and advances in science and technology are transforming nearly every aspect of modern life, including how we communicate with each other, how we shop, how we make things, and how and where we work. In response, US firms are seeking workers with greater proficiency in basic literacy and numeracy as well as more developed interpersonal, technical, and problem-solving skills. For the United States to remain competitive on the world stage while fostering greater innovation and boosting shared prosperity, it needs not only a sufficient number of workers, but also a workforce with the right mix of skills to meet the diverse needs of the economy and to fully engage in civic life.
Alicia Sasser Modestino, Julia Dennett
U.S. policymakers are concerned that negative home equity arising from the housing market crash may be constraining geographic mobility and consequently serving as a factor in the persistently high national unemployment rate. Indeed, the widespread drop in house prices since 2007 has increased the share of homeowners who are underwater on their mortgages. At the same time, migration across states and among homeowners has fallen sharply. Using a logistic regression framework to analyze data from the Internal Revenue Service on state-to-state migration between 2006 and 2009, we discover evidence that “house lock” decreases mobility but find that it has a negligible impact on the national unemployment rate. A one-standard deviation increase in the share of underwater nonprime households in the origin state reduces the outflow of migrants from the origin to the destination state by 2.7%. When aggregated across the United States, this decrease in mobility reduces the national state-to-state migration rate by 0.05 percentage points, resulting in roughly 103,000 to 140,000 fewer individuals migrating across state lines in any given year. A back-of-the-envelope calculation shows that the impact of reduced mobility due to negative housing equity on the national unemployment rate is likely to be small—on the order of less than one-tenth of a percentage point each year.