The Establishment-Level Behavior of Vacancies and Hiring

68 Pages Posted: 16 Aug 2010

See all articles by Steven J. Davis

Steven J. Davis

University of Chicago; National Bureau of Economic Research (NBER)

R. Jason Faberman

Federal Reserve Bank of Chicago; Bureau of Labor Statistics - Office of Employment and Unemployment Statistics

John Haltiwanger

University of Maryland - Department of Economics; National Bureau of Economic Research (NBER); Institute for the Study of Labor (IZA)

Multiple version iconThere are 2 versions of this paper

Date Written: August 2010

Abstract

This paper is the first to study vacancies, hires, and vacancy yields at the establishment level in the Job Openings and Labor Turnover Survey, a large sample of U.S. employers. To interpret the data, we develop a simple model that identifies the flow of new vacancies and the job-filling rate for vacant positions. The fill rate moves counter to aggregate employment but rises steeply with employer growth rates in the cross section. It falls with employer size, rises with worker turnover rates, and varies by a factor of four across major industry groups. We also develop evidence that the employer-level hiring technology exhibits mild increasing returns in vacancies, and that employers rely heavily on other instruments, in addition to vacancies, as they vary hires. Building from our evidence and a generalized matching function, we construct a new index of recruiting intensity (per vacancy). Recruiting intensity partly explains the recent breakdown in the standard matching function, delivers a better-fitting empirical Beveridge Curve, and accounts for a large share of fluctuations in aggregate hires. Our evidence and analysis provide useful inputs for assessing, developing and calibrating theoretical models of search, matching and hiring in the labor market.

Suggested Citation

Davis, Steven J. and Faberman, R. Jason and Haltiwanger, John C., The Establishment-Level Behavior of Vacancies and Hiring (August 2010). NBER Working Paper No. w16265. Available at SSRN: https://ssrn.com/abstract=1658292

Steven J. Davis

University of Chicago ( email )

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R. Jason Faberman

Federal Reserve Bank of Chicago ( email )

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Bureau of Labor Statistics - Office of Employment and Unemployment Statistics ( email )

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John C. Haltiwanger

University of Maryland - Department of Economics ( email )

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National Bureau of Economic Research (NBER) ( email )

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Institute for the Study of Labor (IZA) ( email )

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