Workers’ Perceptions of Earnings Growth and Employment Risk

Gizem Kosar and Wilbert van der Klaauw

No 1056, Staff Reports from Federal Reserve Bank of New York

Abstract: In addition to realized earnings and employment shocks, forward-looking individuals are presumed to condition their consumption and labor supply decisions on their subjective beliefs about future labor market risks. This paper uses rich panel data to document considerable individual heterogeneity in earnings growth expectations and in the perceived likelihood of voluntary and involuntary job exits. We examine how expectations evolve over the working life and business cycle, and how they co-vary with macroeconomic expectations and personal experiences. While largely consistent with patterns in realized outcomes, our findings highlight the unanticipated nature of the pandemic recession and the ensuing resignation wave.

Keywords: Labor-Market Uncertainty; expectations data; beliefs; household surveys (search for similar items in EconPapers)
JEL-codes: C23 D12 D81 D84 J31 J63 (search for similar items in EconPapers)
Pages: 61
Date: 2023-02-01
New Economics Papers: this item is included in nep-des
Note: Revised February 2024.
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Workers’ Perceptions of Earnings Growth and Employment Risk (2023)
Working Paper: Workers' Perceptions of Earnings Growth and Employment Risk (2023)
Working Paper: Workers' Perceptions of Earnings Growth and Employment Risk (2023)
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