How wages respond to the job-finding and job-to-job transition rates? Evidence from New Zealand administrative data

Christopher Ball, Nicolas Groshenny, Ozer Karagedikli, Murat Özbilgin and Finn Robinson
Authors registered in the RePEc Author Service: Hüseyin Murat Özbilgin

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: We use administrative data from New Zealand and exploit regional variations to evaluate the predictive power for wage dynamics of the job-finding and job-to-job transition rates. We find that the job-finding rate from unemployment plays a role in describing the wage dynamics of newly hired workers even after controlling for the job-to-job transition rate. The wages of new hires are much more responsive to both transition rates than the wages of job stayers. We then distinguish between the new hires transitioning from employment (job switchers) and the new hires coming from unemployment. The wages of job switchers are primarily related to the pace of job-to-job reallocation and less significantly to the jobfinding rate. The wages of new hires from unemployment are exclusively linked to the jobfinding rate and this association is stronger at the lower half of the wage distribution. The wages of new hires from unemployment are more responsive to the job-finding rate than the wages of job stayers. The job-to-job transition rate has no impact on the wage dynamics of job stayers once the job-finding rate and the transition rate from inactivity to employment are controlled for.

JEL-codes: J31 J64 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2020-02
New Economics Papers: this item is included in nep-ure
References: Add references at CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: How Wages Respond to the Job-Finding and Job-to-Job Transition Rates: Evidence from New Zealand Administrative Data (2024)
Working Paper: How wages respond to the job-finding and job-to-job transition rates? Evidence from New Zealand administrative data (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2020-15

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