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Job Instability and Earnings and Income Consequences: Evidence from SIPP: 1983-1995

John Fitzgerald ()

JCPR Working Papers from Northwestern University/University of Chicago Joint Center for Poverty Research

Abstract: Transitory fluctuations in earnings have adverse consequences for the poor because of limited ability to smooth consumption. This paper investigates job instability and its consequences on earnings and income using 5 SIPP panels spanning 1983-1995. The paper discusses results for married men, the standard group for most studies, and for unmarried women, a group with welfare policy significance. The paper first looks at earnings fluctuations measured as a transitory coefficient of variation and then at job turnover. The less educated have greater relative earnings fluctuations and more turnover. For the age group 20-59 there is no apparent trend in instability for any education group. The paper then looks at the earnings and income consequences of both job loss and job changes. The earnings consequences of job change appear to improve for the less educated in the 90s, but there is no trend in income consequences. Family income shows greater relative transitory fluctuation than personal earnings due largely to earnings of other family members.

Date: 1999-07-01
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