New data on worker flows during business cycles
AbstractThe most obvious economic cost of recessions is that workers become involuntarily unemployed. During the average business cycle contraction, total employment declines by about 1.5 percent, the unemployment rate rises by 2.7 percentage points, and it takes almost two years before employment recovers its pre-recession level. Both fiscal policy and monetary policy are concerned with these business cycle deviations of employment from its "full-employment" or "equilibrium" level. The aggregate statistics on employment and unemployment mask economically important information about the composition of the unemployed and their experience over time. This paper examines the differential experience during a business cycle of those who quit their jobs, those who are on layoff subject to future recall, and those who suffer permanent job separations. Using a new data set that assembles the flows of workers into and out of unemployment, employment, and not-in-the-labor- force, the authors examine the behavior over time of workers who enter and leave the ranks of the unemployed, grouped by the reason for unemployment. They find that a closer look at the flows into and out of unemployment that lie beneath changes in total unemployment improves forecasts of inflation and unemployment, relative to standard models.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Federal Reserve Bank of Boston in its journal New England Economic Review.
Volume (Year): (1999)
Issue (Month): Jul ()
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- repec:pri:indrel:761 is not listed on IDEAS
- Olivier Jean Blanchard & Lawrence Katz, 1999.
"Wage Dynamics: Reconciling Theory and Evidence,"
NBER Working Papers
6924, National Bureau of Economic Research, Inc.
- Peracchi, Franco & Welch, Finis, 1995.
"How representative are matched cross-sections? Evidence from the Current Population Survey,"
Journal of Econometrics,
Elsevier, vol. 68(1), pages 153-179, July.
- Paracchi, F. & Welch, F., 1992. "How Representative Are Matched Cross Sections? Evidence from the Current Population Survey," Working Papers 92-53, C.V. Starr Center for Applied Economics, New York University.
- Katharine G. Abraham, 1987. "Help-Wanted Advertising, Job Vacancies, and Unemployment," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 18(1), pages 207-248.
- Bruce D. Meyer, 1991.
"Unemployment Insurance And Unemployment Spells,"
NBER Working Papers
2546, National Bureau of Economic Research, Inc.
- Anne E. Polivka & Stephen M. Miller, 1998. "The CPS after the Redesign: Refocusing the Economic Lens," NBER Chapters, in: Labor Statistics Measurement Issues, pages 249-289 National Bureau of Economic Research, Inc.
- Finis Welch, 1993. "Matching the Current Population Surveys," Stata Technical Bulletin, StataCorp LP, vol. 2(12).
- Bruce Chelimsky Fallick, 1993.
"The hiring of new labor by expanding industries,"
Working Paper Series / Economic Activity Section
139, Board of Governors of the Federal Reserve System (U.S.).
- Poterba, James M & Summers, Lawrence H, 1986. "Reporting Errors and Labor Market Dynamics," Econometrica, Econometric Society, vol. 54(6), pages 1319-38, November.
- Christopher L. Foote, 1998.
"Trend Employment Growth and the Bunching of Job Creation and Destruction,"
Harvard Institute of Economic Research Working Papers
1818, Harvard - Institute of Economic Research.
- Christopher L. Foote, 1998. "Trend Employment Growth And The Bunching Of Job Creation And Destruction," The Quarterly Journal of Economics, MIT Press, vol. 113(3), pages 809-834, August.
- Jaeger, David A, 1997. "Reconciling the Old and New Census Bureau Education Questions: Recommendations for Researchers," Journal of Business & Economic Statistics, American Statistical Association, vol. 15(3), pages 300-309, July.
- Nickell, Stephen J, 1979. "Estimating the Probability of Leaving Unemployment," Econometrica, Econometric Society, vol. 47(5), pages 1249-66, September.
- Baker, Michael, 1992. "Unemployment Duration: Compositional Effects and Cyclical Variability," American Economic Review, American Economic Association, vol. 82(1), pages 313-21, March.
- repec:fth:prinin:382 is not listed on IDEAS
- Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998. "Job Creation and Destruction," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262540932, January.
- Henry S. Farber, 1997. "The Changing face of Job Loss in the United States, 1981-1995," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(1997 Micr), pages 55-142.
- Tobin, James, 1972. "Inflation and Unemployment," American Economic Review, American Economic Association, vol. 62(1), pages 1-18, March.
- Lancaster, Tony, 1979. "Econometric Methods for the Duration of Unemployment," Econometrica, Econometric Society, vol. 47(4), pages 939-56, July.
- Oliver Jean Blanchard & Peter Diamond, 1990. "The Cyclical Behovior of the Gross Flows of U.S. Workers," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 21(2), pages 85-156.
- Devine, Theresa J. & Kiefer, Nicolas M., 1991. "Empirical Labor Economics: The Search Approach," OUP Catalogue, Oxford University Press, number 9780195059366.
- Abowd, John M & Zellner, Arnold, 1985. "Estimating Gross Labor-Force Flows," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(3), pages 254-83, June.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Catherine Spozio).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.