New Perspectives on Labor Participation, Search and Employment
Friday, Jan. 6, 2017 10:15 AM – 12:15 PM
Hyatt Regency Chicago, Burnham
- Chair: Andreas I. Mueller, Columbia University
Job Search Behavior Among the Employed and Non-Employed
AbstractUsing a unique new survey, we study the relationship between search effort and search outcomes for employed and non-employed job seekers. Our data have extensive information on individuals’ current and previous employment situations, search behavior, job offers, accepted offers, and reservation wages. We find that the unemployed fare much worse than the employed in their job search prospects along several dimensions, despite higher job search effort. The unemployed receive fewer offers per job application, and conditional on an offer, they are offered lower pay, fewer benefits, and fewer hours. Despite this, they are more likely to accept these lower-quality offers but are also much more likely to again engage in job search on their new job. In contrast, employed job seekers receive a higher fraction of both solicited and unsolicited job offers. In fact, the employed that are not searching tend to generate more plentiful and higher-quality job offers than the unemployed. We apply our results to a model of on-the-job search with search frictions and endogenous search effort. A simple application of the estimates to the model suggest that the employed are substantially more efficient in their job search relative to the unemployed.
Changes in Labor Participation and Household Income
AbstractSince the start of the Great Recession, there has been a substantial decline in the rate of labor force participation (LFPR). A novel contribution of our approach is to examine how this decline varies across the distribution of household income. Using the SIPP, we find that almost all of the decline in the LFPR of 25- to 54-year-olds can be attributed to declining participation by individuals in households in the upper half of the household income distribution. The result that the decline in prime-age LFPR is concentrated in higher-income households continues a trend that started as early as 2001, and is strongest for men. We find similar patterns among 16 to 24 year olds, and no significant difference across household income for the population over 55.
Aggregate Recruiting Intensity
AbstractWe develop a model of firm dynamics with random search in the labor market where hiring firms exert recruiting effort by spending resources to fill vacancies faster. Consistent with micro evidence, fast-growing firms invest more in recruiting activities and achieve higher job-filling rates. In equilibrium, individual recruiting decisions of hiring firms aggregate into an index of economy-wide recruiting intensity. We use the model to study how recruiting intensity responds to aggregate shocks, and whether it can account for the dynamics of aggregate matching efficiency around the Great Recession. Productivity and financial shocks can lead to sizable procyclical fluctuations in matching efficiency through recruiting effort. Quantitatively, the main mechanism is that firms attain their employment targets by adjusting their recruitment effort as labor market tightness varies. Instead, fluctuations in new-firm entry have a negligible effect on aggregate recruiting intensity, despite their contribution to aggregate job creations.
University of Chicago
Federal Reserve Bank of New York
Thijs van Rens,
University of Warwick
- J0 - General