Labor market power and worker turnover

Raja Kali and Andrew Yizhou Liu

European Economic Review, 2024, vol. 163, issue C

Abstract: The last two decades have seen a significant decrease in labor market turnover and an increase in labor market concentration. We investigate whether labor market power, as manifested by employer concentration and outside options, affect turnover rates. Utilizing online vacancy posting data, we find that moving from the 25th percentile to 75th percentile of employer concentration reduces the turnover rate by 5%, driven by high-school workers in low-skill industries. The same exercise for outside options implies a 39% increase in the turnover rate, driven by workers in high-skill industries.

Keywords: Labor market power; Turnover rate; Employer concentration; Outside options (search for similar items in EconPapers)
JEL-codes: E24 J23 J42 J63 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:163:y:2024:i:c:s0014292124000308

DOI: 10.1016/j.euroecorev.2024.104701

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