Labor Market Concentration in Germany

Michael Oberfichtner () and Martin Popp ()
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Michael Oberfichtner: Institute for Employment Research (IAB), Nuremberg
Martin Popp: Institute for Employment Research (IAB), Nuremberg

No 17745, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using register data, we document that the average German labor market, defined by hires in combinations of 3-digit occupations, requirement levels, and commuting zones, is highly concentrated ( HHI =0.257). By EU antitrust thresholds, 56 percent of these labor markets feature moderate or high concentration, covering 9 percent of workers. Concentration remained relatively stable between 2012 and 2023. The labor market delineation strongly affects the measured level of concentration but not its evolution, whereas the choice of the firm size variable has little influence. Concentration differs starkly across occupations and regions, and workers in complex jobs experience the highest levels of concentration.

Keywords: monopsony power; labor market concentration; occupations (search for similar items in EconPapers)
JEL-codes: J42 J60 L10 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2025-02
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Forthcoming - forthcoming in: German Economic Review, 2025

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