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The Income Losses of Displaced Workers

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Author Info

  • Alexander Hijzen
  • Richard Upward
  • Peter W. Wright

Abstract

We use a new, matched worker-firm dataset for the United Kingdom to estimate the income loss resulting from firm closure and mass layoffs. We track workers for up to nine years after the displacement event, and the availability of predisplacement characteristics allows us to implement difference-in-differences estimators using propensity score matching methods. Income losses during the first five years after the displacement event are in the range 18–35 percent per year for workers whose firm closes down, and 14–25 percent for workers who exit a firm which suffers a mass layoff. These losses are largely due to periods of nonemployment, which is consistent with previous work from Europe, but contrasts with that from the United States.

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Bibliographic Info

Article provided by University of Wisconsin Press in its journal Journal of Human Resources.

Volume (Year): 45 (2010)
Issue (Month): 1 ()
Pages:

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Handle: RePEc:uwp:jhriss:v:45:y:2010:i:1:p243-269

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Web page: http://jhr.uwpress.org/

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Cited by:
  1. Tiziano Razzolini & Roberto Leombruni & Giovanni Mastrobuoni & Mario Pagliero, 2012. "Beneath the Surface: the Decline in Gender Injury Gap," Carlo Alberto Notebooks 286, Collegio Carlo Alberto.
  2. repec:ese:iserwp:2004-21 is not listed on IDEAS
  3. repec:hal:wpaper:halshs-00684101 is not listed on IDEAS
  4. Hartmut Lehmann & Alexander Muravyev & Tiziano Razzolini & Anzelika Zaiceva, 2011. "The Wage and Non-wage Costs of Displacement: Evidence from Russia," Center for Economic Research (RECent) 060, University of Modena and Reggio E., Dept. of Economics.
  5. Bruce Fallick & John Haltiwanger & Erika McEntarfer, 2012. "Job-to-job flows and the consequences of job separations," Finance and Economics Discussion Series 2012-73, Board of Governors of the Federal Reserve System (U.S.).
  6. repec:hal:cesptp:halshs-00684101 is not listed on IDEAS
  7. Wiederhold, Simon & Nedelkoska, Ljubica & Neffke, Frank, 2013. "The Impact of Skill Mismatch on Earnings Losses after Job Displacement," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79739, Verein für Socialpolitik / German Economic Association.
  8. Ge, Yuhao & Lehmann, Hartmut, 2013. "The Costs of Worker Displacement in Urban Labor Markets of China," IZA Discussion Papers 7327, Institute for the Study of Labor (IZA).
  9. Browning, Martin & Heinesen, Eskil, 2012. "Effect of job loss due to plant closure on mortality and hospitalization," Journal of Health Economics, Elsevier, vol. 31(4), pages 599-616.
  10. Marcus Eliason, 2012. "Lost jobs, broken marriages," Journal of Population Economics, Springer, vol. 25(4), pages 1365-1397, October.
  11. Héloïse Petit & Corinne Perraudin & Thomas Amossé, 2011. "Mobilité et segmentation du marché du travail : quel parcours professionnel après avoir perdu ou quitté son emploi ?," Économie et Statistique, Programme National Persée, vol. 450(1), pages 79-105.
  12. Lehmann, Hartmut & Muravyev, Alexander & Razzolini, Tiziano & Zaiceva, Anzelika, 2010. "The Costs of Job Loss in Russia," IZA Discussion Papers 5415, Institute for the Study of Labor (IZA).
  13. Hartmut Lehmannan & Tiziano Razzolini & Anzelika Zaiceva, 2012. "Job separations, job loss and informality in the Russian labor marke," Center for Economic Research (RECent) 076, University of Modena and Reggio E., Dept. of Economics.
  14. Philip Ball, . "Mixed Signals: to what extent does male wage scarring vary with the characteristics of the local labour market in which unemployment was experienced?," Discussion Papers 11/13, University of Nottingham, School of Economics.
  15. Lehmann, Hartmut & Razzolini, Tiziano & Zaiceva, Anzelika, 2011. "Job Separations and Informality in the Russian Labor Market," IZA Discussion Papers 6230, Institute for the Study of Labor (IZA).
  16. Verónica Amarante & Rodrigo Arim & Andrés Dean, 2012. "The effects of being out of the labor market on subsequent wages: evidence for Uruguay," Documentos de Trabajo basados en Monografías (students working papers) 12-10, Instituto de Economía - IECON.
  17. Geishecker, Ingo & Riedl, Maximilian & Frijters, Paul, 2012. "Offshoring and job loss fears: An econometric analysis of individual perceptions," Labour Economics, Elsevier, vol. 19(5), pages 738-747.
  18. Lehmann, Hartmut & Muravyev, Alexander & Razzolini, Tiziano & Zaiceva, Anzelika, 2013. "The wage and non-wage costs of displacement in boom times: Evidence from Russia," Journal of Comparative Economics, Elsevier, vol. 41(4), pages 1184-1201.
  19. Leombruni, Roberto & Razzolini, Tiziano & Serti, Francesco, 2013. "The pecuniary and non-pecuniary costs of job displacement—The risky job of being back to work," European Economic Review, Elsevier, vol. 61(C), pages 205-216.

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