The secondary labor market is the labor market consisting of high-turnover, low-pay, and usually part time and/or temporary jobs. Sometimes, secondary jobs are performed by high school or college students. The majority of service sector, light manufacturing, and retail jobs are considered secondary labor.[1]
A secondary-market job is distinct from a "secondary worker". The latter term refers to someone in a family (traditionally, the wife or a child) who earns a smaller income than the "bread-winner" in order to supplement the family income.
The existence of the secondary labor market challenges classical explanations of the functioning of the labor market. Classical and neo-classical economists conceived of the labor market as a commodity market: the concurrent interaction of labor supply (rational workers seeking their well-being) and labor demand (rational employers searching to maximize their profits) should determine general employment and wage levels. However, these traditional theories leave unexplained major real-life issues, such as the large differences observed among wages and employment conditions in the current labor market. The Neoclassical school had argued that these differences were due to disparities in workers' productivity based on employees' different human capital endowments, but as critics have pointed out, most of them would be due to institutional factors more than to economic causes. In other words, it is not people that are different but rather job characteristics, and it is not human productivity that is behind the differences but rather market, technical, organizational and political factors.