The Dynamics of Worker Reallocation within and Across Industries

U.S. Census Bureau, LEHD Technical Paper No. TP-2004-01

25 Pages Posted: 25 Oct 2004

See all articles by Amos Golan

Amos Golan

American University - Department of Economics

Julia Lane

Wagner Graduate School of Public Service; Institute for the Study of Labor (IZA)

Erika McEntarfer

U.S. Census Bureau

Multiple version iconThere are 2 versions of this paper

Date Written: June 2005

Abstract

This paper uses an integrated employer-employee data set to answer two key questions:

1. What is the equilibrium amount of worker reallocation in the economy - both within and across industries?

2. How much does firm-level job reallocation affect the separation probabilities of workers?

Consistent with other work, we find that there is a great deal of reallocation in the economy, although this varies substantially across demographic group. Much worker reallocation is within the economy, roughly evenly split between within and across broadly defined industries. An important new finding is that much of this reallocation is confined to a relatively small subset of workers that is shuffled across jobs - both within and across industries - in the economy. However, we also find that even for the most stable group of workers, firm level job reallocation substantially increases the probability of transition for even the most stable group of workers. Finally, workers who are employed in industries that provide low returns to tenure are much more likely to reallocate both within and across industries.

Keywords: Markov transitions, worker flows, employment transitions, within industry reallocation, across industry reallocation

JEL Classification: J63, J21, J23

Suggested Citation

Golan, Amos and Lane, Julia and McEntarfer, Erika, The Dynamics of Worker Reallocation within and Across Industries (June 2005). U.S. Census Bureau, LEHD Technical Paper No. TP-2004-01. Available at SSRN: https://ssrn.com/abstract=608222 or http://dx.doi.org/10.2139/ssrn.608222

Amos Golan

American University - Department of Economics ( email )

4400 Massachusetts Avenue, N.W.
Washington, DC 20016-8029
United States

Julia Lane (Contact Author)

Wagner Graduate School of Public Service ( email )

The Puck Building
295 Lafayette Street, Second Floor
New York, NY 10012
United States

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

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

HOME PAGE: http://www.iza.org

Erika McEntarfer

U.S. Census Bureau ( email )

4600 Silver Hill Road
Washington, DC 20233
United States

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