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Working Paper

Job Displacement and Job Mobility: The Role of Joblessness

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Who is harmed by and who benefits from worker reallocation? We investigate the earnings consequences of changing jobs and find a wide dispersion in outcomes. This dispersion is driven not by whether the worker was displaced, but by the duration of joblessness between job spells. Job movers who experience joblessness suffer a persistent reduction in earnings and tend to move to lower-paying firms, suggesting that job ladder models offer a useful lens through which to understand the negative consequences of job separations.
Topics
Labor economics
08.31.2021ISSN 2573-7953 WP 19-27ROriginal Paper WP 19-27DOI 10.26509/frbc-wp-201927r
Keywords displaced workers, job mobility, job ladders
JEL Classification Codes J63, J64

Working Papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded official Federal Reserve Bank of Cleveland publications. The views expressed in this paper are those of the authors and do not represent the views of the Federal Reserve Bank of Cleveland or the Federal Reserve System.

Suggested Citation

Fallick, Bruce, John Haltiwanger, Erika McEntarfer, and Matthew Staiger. 2021. “Job Displacement and Job Mobility: The Role of Joblessness.” Federal Reserve Bank of Cleveland, Working Paper No. 19-27R. https://doi.org/10.26509/frbc-wp-201927r