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The Structure of Hiring Costs in Germany: Evidence from Firm-Level Data

Samuel Mühlemann () and Harald Pfeifer ()
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Samuel Mühlemann: University of Munich

Authors registered in the RePEc Author Service: Samuel Muehlemann ()

No 7656, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper analyzes the structure of hiring costs of skilled workers in Germany. Using detailed and representative firm-level data on recruitment and adaptation costs of new hires, we find that average hiring costs amount to more than 8 weeks of wage payments (4,700 Euros). The structure of hiring costs is convex, as an increase in the number of hires by 1% increases hiring costs by 1.3%. We find moderate effects of labor market institutions on the magnitude but none on the structure of hiring costs. Furthermore, we provide evidence in favor of monopsony power in the German labor market.

Keywords: labor adjustment costs; hiring costs; search costs; adaptation costs (search for similar items in EconPapers)
JEL-codes: J32 J63 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2013-09
New Economics Papers: this item is included in nep-lab and nep-lma
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Published - published in: Industrial Relations, 2016, 55 (2), 193–218

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Related works:
Journal Article: The Structure of Hiring Costs in Germany: Evidence from Firm-Level Data (2016) Downloads
Working Paper: The Structure of Hiring Costs in Germany: Evidence from Firm-Level Data (2016)
Working Paper: The structure of hiring costs in Germany - evidence from firm-level data (2013) Downloads
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