The Cyclicality of Worker Flows: New Evidence from the Sipp

28 Pages Posted: 14 Feb 2007

See all articles by Shigeru Fujita

Shigeru Fujita

Federal Reserve Bank of Philadelphia

Christopher J. Nekarda

Board of Governors of the Federal Reserve System

Garey Ramey

University of California, San Diego (UCSD) - Department of Economics

Date Written: January 29, 2007

Abstract

Drawing on CPS data, the authors show that total monthly job loss and hiring among U.S. workers, as well as job loss hazard rates, are strongly countercyclical, while job finding hazard rates are strongly procyclical. They also find that total job loss and job loss hazard rates lead the business cycle, while total hiring and job finding rates trail the cycle. In the current paper the authors use information from the Survey on Income and Program Participation (SIPP) to reevaluate these findings. SIPP data are used to construct new longitudinally consistent gross flow series for U.S. workers, covering 1983-2003. The results strongly validate the authors' findings, with two important exceptions: (1) total hiring leads the cycle in the SIPP data, and (2) the job loss rate is substantially more volatile than the job finding rate at business cycle frequencies.

Keywords: Job loss, Hiring, SIPP worker flows

JEL Classification: J63, J64

Suggested Citation

Fujita, Shigeru and Nekarda, Christopher J. and Ramey, Garey, The Cyclicality of Worker Flows: New Evidence from the Sipp (January 29, 2007). FRB of Philadelphia Working Paper No. 07-5, Available at SSRN: https://ssrn.com/abstract=962702 or http://dx.doi.org/10.2139/ssrn.962702

Shigeru Fujita (Contact Author)

Federal Reserve Bank of Philadelphia ( email )

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Christopher J. Nekarda

Board of Governors of the Federal Reserve System ( email )

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United States

HOME PAGE: http://chrisnekarda.com

Garey Ramey

University of California, San Diego (UCSD) - Department of Economics ( email )

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La Jolla, CA 92093-0508
United States
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