Job Spells, Employer Spells, and Wage Returns to Tenure

31 Pages Posted: 18 May 2013

See all articles by Paul J. Devereux

Paul J. Devereux

University College Dublin - Department of Economics; IZA Institute of Labor Economics

Robert A. Hart

University of Stirling - Department of Economics; Institute for the Study of Labor (IZA)

Elizabeth Roberts

University of Stirling - Department of Economics

Abstract

We show that the distinction between job spells and employer spells matters for returns to tenure. Employer spells encompass between-job wage movements linked to promotions or demotions while job spells don't. Using a 1% sample of the British workforce over the period 1975-2010, we find that a significant proportion of the return to employer tenure arises due to job changes within employer spells. Conditional on tenure with employer, the return to job tenure is negative. This suggests that any positive effects of job-specific human capital on wage growth within jobs are outweighed by the effects of job changes within firms.

Keywords: job spells, employer spells, wage-tenure profiles

JEL Classification: J31, J24

Suggested Citation

Devereux, Paul J. and Hart, Robert A. and Roberts, Elizabeth, Job Spells, Employer Spells, and Wage Returns to Tenure. IZA Discussion Paper No. 7384, Available at SSRN: https://ssrn.com/abstract=2266811 or http://dx.doi.org/10.2139/ssrn.2266811

Paul J. Devereux (Contact Author)

University College Dublin - Department of Economics ( email )

Belfield
Dublin 4, 4
Ireland

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Robert A. Hart

University of Stirling - Department of Economics ( email )

Stirling, Scotland FK9 4LA
United Kingdom
+44 1786 467 471 (Phone)
+44 1786 467 469 (Fax)

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

Elizabeth Roberts

University of Stirling - Department of Economics ( email )

Stirling FK9 4LA, Scotland FK9 4LA
United Kingdom

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