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Displaced workers, early leavers, and re-employment wages

Audra Bowlus () and Lars Vilhuber ()

Longitudinal Employer-Household Dynamics Technical Papers from Center for Economic Studies, U.S. Census Bureau

Abstract: In this paper, we lay out a search model that takes explicitly into account the information flow prior to a mass layoff. Using universal wage data files that allow us to identify individuals working with healthy and displacing firms both at the time of displacement as well as any other time period, we test the predictions of the model on re-employment wage differentials. Workers leaving a "distressed" firm have higher re-employment wages than workers who stay with the distressed firm until displacement. This result is robust to the inclusion of controls for worker quality and unobservable firm characteristics.

Keywords: Displaced workers; search theory; advance notice; linked firm-worker data sets (search for similar items in EconPapers)
JEL-codes: J31 J65 J63 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2002-11
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https://www2.census.gov/ces/tp/tp-2002-18.pdf First version, 2002 (application/pdf)

Related works:
Working Paper: Displaced workers, early leavers, and re-employment wages (2002) Downloads
Working Paper: Displaced Workers, Early Leavers, and Re-employment Wages (2001) Downloads
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