Job-to-Job Flows and the Consequences of Job Separations

43 Pages Posted: 16 Dec 2019

See all articles by Bruce Fallick

Bruce Fallick

Federal Reserve Banks - Federal Reserve Bank of Cleveland

John Haltiwanger

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

Erika McEntarfer

U.S. Census Bureau

Matthew Staiger

University of Maryland - College Park

Multiple version iconThere are 2 versions of this paper

Date Written: December 13, 2019

Abstract

A substantial empirical literature documents large and persistent average earnings losses following job displacement. Our paper extends the literature on displaced workers by providing a comprehensive picture of earnings and employment outcomes for all workers who separate. We show that for workers not recalled to their previous employer, earnings losses follow separations in general, as opposed to displacements in particular. The key predictor of earnings losses is not displacement but the length of the nonemployment spell following job separation. Moreover, displaced workers are no more likely to experience a substantial spell of nonemployment than are other non-recalled separators. Our results suggest that future research on the consequences of job loss should work to disentangle the strong association between nonemployment and earnings losses, as opposed to focusing specifically on displaced workers.

JEL Classification: J63, J64

Suggested Citation

Fallick, Bruce and Haltiwanger, John C. and McEntarfer, Erika and Staiger, Matthew, Job-to-Job Flows and the Consequences of Job Separations (December 13, 2019). FRB of Cleveland Working Paper No. 19-27, Available at SSRN: https://ssrn.com/abstract=3503543 or http://dx.doi.org/10.2139/ssrn.3503543

Bruce Fallick (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of Cleveland ( email )

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John C. Haltiwanger

University of Maryland - Department of Economics ( email )

College Park, MD 20742
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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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Erika McEntarfer

U.S. Census Bureau ( email )

4600 Silver Hill Road
Washington, DC 20233
United States

Matthew Staiger

University of Maryland - College Park ( email )

College Park, MD 20742
United States

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