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Inter-Firm Labor Mobility and Wages

Schneck Stefan ()
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Schneck Stefan: Institut für Empirische Wirtschaftsforschung, Leibniz Universität Hannover, Königsworther Platz 1, D-30167 Hannover

Review of Economics, 2010, vol. 61, issue 2, 196-211

Abstract: Individuals who want to leave their employer usually raise the question whether mobility to a new employer pays off in the future. The paper contributes to this question by examining the consequences of labor market mobility in the medium term. Conclusions regarding whether an individual’s wage trajectory at the new employer exceeds the one of the previous employer are drawn by application of an innovative procedure which involves the simultaneous investigation of wage trajectories at different employers. The main finding is that a considerable number of workers experience wage cuts which are of permanent nature. Only few of the transitions to lower wages pay off because of the steeper wage growth in the new job.

Date: 2010
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DOI: 10.1515/roe-2010-0205

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