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Job Performance, Turnover, and Wage Growth

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  • Bishop, John H

Abstract

This article presents evidence that turnover is negatively selective on a worker's job performance. At establishments with about seventeen employees, workers who are one standard deviation (21 percent) less productive than average during the first few months on the job are 11 percentage points more likely to be laid off or fired and 7 percentage points more likely to quit during the succeeding year. At large nonunion establishments and in small labor markets, productivity has large effects on involuntary separations, but almost no effect on quits. Productivity appears to be positively related to layoffs and quits at unionized establishments. Copyright 1990 by University of Chicago Press.

Suggested Citation

  • Bishop, John H, 1990. "Job Performance, Turnover, and Wage Growth," Journal of Labor Economics, University of Chicago Press, vol. 8(3), pages 363-386, July.
    • Handle: RePEc:ucp:jlabec:v:8:y:1990:i:3:p:363-86
    DOI: 10.1086/298227
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    Cited by:

    1. Ferreira, Priscila, 2009. "The determinants of promotions and firm separations," ISER Working Paper Series 2009-11, Institute for Social and Economic Research.
    2. Joseph G. Altonji & Nicolas Williams, 2005. "Do Wages Rise with Job Seniority? A Reassessment," ILR Review, Cornell University, ILR School, vol. 58(3), pages 370-397, April.
    3. Alan B. Krueger & Cecilia E. Rouse, 1994. "New Evidence on Workplace Education," Working Papers 708, Princeton University, Department of Economics, Industrial Relations Section..
    4. Gielen, A. C. & van Ours, J.C., 2006. "Why do Worker-Firm Matches Dissolve?," Other publications TiSEM 8c99a292-9f34-4ce8-8fd9-9, Tilburg University, School of Economics and Management.
    5. William Bentley MacLeod & Daniel Parent, 1998. "Job Characteristics and the Form of Compensation," CIRANO Working Papers 98s-08, CIRANO.
    6. Pernilla Andersson Joona & Eskil Wadensjö, 2013. "The best and the brightest or the least successful? Self-employment entry among male wage-earners in Sweden," Small Business Economics, Springer, vol. 40(1), pages 155-172, January.
    7. Statt, A.L., 1998. "Great Prospects: Employer Provided Training as a Credible Screening Device," Working Papers Series 9802, University of Stirling, Division of Economics.
    8. Caliendo, Marco & Cobb-Clark, Deborah A. & Obst, Cosima & Uhlendorff, Arne, 2023. "Risk preferences and training investments," Journal of Economic Behavior & Organization, Elsevier, vol. 205(C), pages 668-686.
    9. Arturo Pérez Mendoza, 2005. "Liberalización comercial y la creación y destrucción de empleo," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 20(1), pages 79-108.
    10. Christiane Hinerasky & Rene Fahr, 2014. "Learning Outcomes, Feedback, and the Performance Effects of a Training Program," Working Papers Dissertations 16, Paderborn University, Faculty of Business Administration and Economics.
    11. Kuan‐Jen Chen & Ching‐Chong Lai, 2015. "On‐the‐Job Learning and News‐Driven Business Cycles," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 47(2-3), pages 261-294, March.
    12. Powers, Eric A., 2005. "Interpreting logit regressions with interaction terms: an application to the management turnover literature," Journal of Corporate Finance, Elsevier, vol. 11(3), pages 504-522, June.
    13. Cosima Obst, 2022. "Job Satisfaction and Training Investments," CEPA Discussion Papers 47, Center for Economic Policy Analysis.
    14. Statt, A.L., 1998. "Training and Displacement: is Employer Paid Training Firm-Specific?," Working Papers Series 9801, University of Stirling, Division of Economics.
    15. Ann P. Bartel, 1991. "Productivity Gains From the Implementation of Employee Training Programs," NBER Working Papers 3893, National Bureau of Economic Research, Inc.
    16. Krueger, Alan & Rouse, Cecilia, 1998. "The Effect of Workplace Education on Earnings, Turnover, and Job Performance," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 61-94, January.
    17. Richard Blundell & Lorraine Dearden & Costas Meghir & Barbara Sianesi, 1999. "Human capital investment: the returns from education and training to the individual, the firm and the economy," Fiscal Studies, Institute for Fiscal Studies, vol. 20(1), pages 1-23, March.
    18. Joseph G. Altonji & Nicolas Williams, 1992. "The Effects of Labor Market Experience, Job Seniority, and Job Mobility on Wage Growth," NBER Working Papers 4133, National Bureau of Economic Research, Inc.

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