Labor Mobility and Unemployment over the Business Cycle
AEA Papers and Proceedings
vol. 113,
May 2023
(pp. 590-96)
Abstract
We estimate the responsiveness of net labor migration to regional differences in unemployment rates across the United States since the mid-1970s. Our baseline estimate suggests an elasticity of roughly -0.3. For typical labor force participation ratios, an increase of 100 unemployed workers in an area is associated with net out-migration of roughly 47 workers. Instrumenting for regional unemployment produces even higher estimates. Our estimates are stable over time, inclusive of the Great Recession. The estimates depend crucially on accurate data and accounting for long-term trends in migration and unemployment.Citation
Foschi, Andrea, Christopher L. House, Christian Proebsting, and Linda L. Tesar. 2023. "Labor Mobility and Unemployment over the Business Cycle." AEA Papers and Proceedings, 113: 590-96. DOI: 10.1257/pandp.20231079Additional Materials
JEL Classification
- E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
- E32 Business Fluctuations; Cycles
- J61 Geographic Labor Mobility; Immigrant Workers
- R23 Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics