Concentration in Us Labor Markets: Evidence from Online Vacancy Data

Abstract

Using data on the near-universe of online US job vacancies collected by Burning Glass Technologies in 2016, we calculate labor market concentration using the Herfindahl-Hirschman index (HHI) for each commuting zone by 6-digit SOC occupation. The average market has an HHI of 4,378, or the equivalent of 2.3 recruiting employers. 60% of labor markets are highly concentrated (above 2,500 HHI) according to the DOJ/FTC guidelines. Highlyconcentrated markets account for 20% of employment. Many plausible alternative market definitions show that more than 40% of markets are highly concentrated, suggesting that employers have market power in many US labor markets.

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