Real Wage Cyclicality of Job Stayers, Within-Company Job Movers, and Between-Company Job Movers

28 Pages Posted: 21 Jul 2005

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)

Date Written: July 2005

Abstract

Using the British New Earnings Survey Panel Data (NESPD) for the period 1975 to 2001 we estimate the wage cyclicality of job stayers (those remaining within single jobs in a given company), within company job movers, and between company job movers. We also examine how the proportion of internal and external job moves varies over the business cycle. We find that the wages of internal movers are slightly more procyclical and wages of external movers considerably more procyclical than those of stayers. Notwithstanding, a decomposition shows that in Britain, wage cyclicality arises almost entirely from the procyclicality of wages for job stayers, with across- and within-firm mobility playing a lesser role. Thus, there is little evidence for rigid wage models that imply that employers use changes in job titles as a means of adjusting wages to the business cycle. We also show that the distinctions between private and public sectors and between workers covered and uncovered by collective agreements have important impacts on the wage estimates of both stayers and movers.

Keywords: wage cyclicality, job stayers, internal job movers, external job movers

JEL Classification: E32, J31

Suggested Citation

Devereux, Paul J. and Hart, Robert A., Real Wage Cyclicality of Job Stayers, Within-Company Job Movers, and Between-Company Job Movers (July 2005). IZA Discussion Paper No. 1651, Available at SSRN: https://ssrn.com/abstract=758326 or http://dx.doi.org/10.2139/ssrn.758326

Paul J. Devereux

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 (Contact Author)

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

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