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Reconsidering the Consequences of Worker Displacements: Firm versus Worker Perspective

Aaron Flaaen, Matthew Shapiro and Isaac Sorkin

No 2018-029, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: Prior literature has established that displaced workers suffer persistent earnings losses by following workers in administrative data after mass layoffs. This literature assumes that these are involuntary separations owing to economic distress. This paper examines this assumption by matching survey data on worker-supplied reasons for separations with administrative data. Workers exhibit substantially different earnings dynamics in mass layoffs depending on the reason for separation. Using a new methodology to account for the increased separation rates across all survey responses during a mass layoff, the paper finds earnings loss estimates that are surprisingly close to those using only administrative data.

Keywords: Earnings losses; Job loss; Unemployment (search for similar items in EconPapers)
JEL-codes: J00 J26 J63 J65 (search for similar items in EconPapers)
Pages: 59 pages
Date: 2018-05-04
New Economics Papers: this item is included in nep-lab and nep-mac
References: Add references at CitEc
Citations: View citations in EconPapers (4)

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https://www.federalreserve.gov/econres/feds/files/2018029pap.pdf (application/pdf)

Related works:
Journal Article: Reconsidering the Consequences of Worker Displacements: Firm versus Worker Perspective (2019) Downloads
Working Paper: Reconsidering the Consequences of Worker Displacements: Firm versus Worker Perspective (2017) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2018-29

DOI: 10.17016/FEDS.2018.029

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