How Substitutable Are Workers? Evidence from Worker Deaths

Simon Jäger and Jörg Heining

No 10126, CESifo Working Paper Series from CESifo

Abstract: We estimate how exogenous worker exits affect firms’ demand for incumbent workers and new hires. Drawing on administrative data from Germany, we analyze 34,000 unexpected worker deaths, which, on average, raise the remaining workers’ wages and retention probabilities. The average effect masks substantial heterogeneity: Coworkers in the same occupation as the deceased see positive wage effects; coworkers in other occupations experience wage decreases when a high-skilled or specialized worker dies. Our findings imply substantial replacement costs, which are larger in thin markets and when skills are specialized.

Date: 2022
New Economics Papers: this item is included in nep-lma
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Citations: View citations in EconPapers (27)

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Working Paper: How Substitutable Are Workers? - Evidence from Worker Deaths (2022)
Working Paper: How Substitutable Are Workers? Evidence from Worker Deaths (2022)
Working Paper: How Substitutable Are Workers? Evidence from Worker Deaths (2022)
Working Paper: How Substitutable Are Workers? Evidence from Worker Deaths (2019)
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