The strength of the weakest link: sickness absence, internal substitutability and worker-firm matching

Lena Hensvik () and Olof Rosenqvist
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Lena Hensvik: IFAU - Institute for Evaluation of Labour Market and Education Policy, Postal: P O Box 513, SE-751 20 Uppsala, Sweden

No 2015:28, Working Paper Series from IFAU - Institute for Evaluation of Labour Market and Education Policy

Abstract: We study how employee sickness absence affects worker-firm matching. We build on the idea that firms are sensitive to absence in jobs with few substitutes (unique positions). Consistent with this, we show that unique employees are less absent conditional on individual characteristics, establishment fixed effects and detailed occupational information. Half of this association is explained by sorting of low-absence workers into unique positions but sorting is less pronounced under imperfect information. Finally, job separations respond more to realized sickness absence in unique positions. The findings suggest that the cost of production disruptions is an important aspect of firms’ hiring choices.

Keywords: Sickness absence; production disruption; coworker substitutes; hiring strategies (search for similar items in EconPapers)
JEL-codes: J23 J24 L23 M51 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2015-11-23
New Economics Papers: this item is included in nep-hrm and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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