Firm Pay and Worker Search

Sydnee Caldwell, Ingrid Haegele and Jörg Heining
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Sydnee Caldwell: University of California at Berkeley & National Bureau of Economic Research (NBER)
Ingrid Haegele: Ludwig-Maximilians Universität München und Institut für Arbeitsmarkt- und Berufsforschung (IAB)
Jörg Heining: Institute for Employment Research (IAB), Nuremberg, Germany

No 202504, IAB-Discussion Paper from Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]

Abstract: "Whether and how workers search on the job depends on their beliefs about pay and working conditions in other firms. Yet little is known about workers’ knowledge of outside pay. We use a large-scale survey of full-time German workers, linked to their Social Security records, to elicit pay expectations and preferences over specific outside firms. Workers believe that they face considerable heterogeneity in their outside pay options, and direct their search toward firms they believe would pay them more.Workers’ expected firm-specific pay premia are highly correlated with pay policies observed in administrative records and with workers’ valuations of firm-specific amenities.Most workers are unwilling to search for a new job—or leave their current firm—even for substantial pay increases. Switching costs are equivalent to 7 to 18 percent of a worker’s annual pay. Attachment varies across firms, and cannot be explained by either differences in firm-specific amenities or switching costs." (Author's abstract, IAB-Doku) ((en))

Keywords: Bundesrepublik Deutschland; IAB-Open-Access-Publikation; Auswirkungen; Betriebstreue; Einkommenseffekte; Einkommenserwartung; abhängig Beschäftigte; Kündigungsabsicht; Lohnunterschied; Präferenz; Arbeitsbedingungen; Unternehmen; Arbeitsplatzwechsel; zwischenbetriebliche Mobilität; Arbeitsuche; 2022-2024 (search for similar items in EconPapers)
JEL-codes: J00 J30 J31 J32 (search for similar items in EconPapers)
Pages: 141 pages
Date: 2025-03-12
New Economics Papers: this item is included in nep-lma
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https://doi.org/10.48720/IAB.DP.2504

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Persistent link: https://EconPapers.repec.org/RePEc:iab:iabdpa:202504

DOI: 10.48720/IAB.DP.2504

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