Wage Growth and Job Turnover: An Empirical Analysis

Ann P. Bartel and George Borjas

No 285, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper demonstrates that labor turnover is a significant factor in understanding wage growth since it affects both wage growth across jobs and wage growth within the job. Our analysis shows that young men who quit experience significant wage gains compared to stayers and compared to their own wage growth prior to the job change. Among older men, a quit increases wage growth only if the individual said he changed jobs because he found a better job. Yet in both age groups, individuals who expect to remain on the current job experience steeper wage growth per time period on that job. Thus labor turnover has offsetting effects on wage growth, leading to wage gains across jobs but flatter growth in shorter jobs. Our empirical analysis shows however that total life-cycle wage growth is positively related to current tenure. While early mobility may pay, individuals who are still changing jobs later in life experience lower overall wage growth.

Date: 1978-10
Note: LS
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Published as Bartel, Ann P. and Borjas, George J. "Wage Growth and Job Turnover: An Empirical Analysis." Studies in Labor Markets, edited by Sherwin Rosen, pp. 65- 90. Chicago: University of Chicago Press, 1981.
Published as Wage Growth and Job Turnover: An Empirical Analysis , Ann P. Bartel, George J. Borjas. in Studies in Labor Markets , Rosen. 1981

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