Reconsidering the cost of job loss: Evidence from redundancies and mass layoffs

Jonas Cederlöf

No 2024:2, Working Paper Series from IFAU - Institute for Evaluation of Labour Market and Education Policy

Abstract: This paper studies the consequences of job loss. While previous literature has relied on mass layof fs and plant closures for identification, I exploit discontinuities in the likelihood of dis placement generated by a last-in-first-out rule used at layof fs in Sweden. Matching data on individual layof f notifications to administrative records, I find that permanent earnings losses are only found among workers losing their job in mass layof fs, whereas workers dis placed in smaller layof fs fully recover. Auxiliary analysis suggests that large layof fs increase exposure to non-employment, prolong unemployment and cause workers to leave the labor force, conceivably by affecting the local labor market

Keywords: last-in-first-out; job loss; displaced worker; mass layoff; earnings loss (search for similar items in EconPapers)
JEL-codes: J63 J64 J65 (search for similar items in EconPapers)
Pages: 77 pages
Date: 2024-02-06
New Economics Papers: this item is included in nep-hea, nep-lab and nep-ure
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Citations: View citations in EconPapers (1)

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