Industry Restructuring and Absenteeism. A Micoreconomteric Analysis Using Matched Employer-Employee Data

Sickness incidence and recovery are likely to be affected not only by characteristics of individual workers, but also by the conditions under which they work. Large register data bases have been available for researchers in several countries for some years now, allowing detailed research on how individual characteristics influence on sickness absenteeism. We add to this literature by the analysis of the workplace effect on sickness absenteeism, using merged individual-firm panel data for 220 000 individuals in the Norwegian manufacturing sector during 1992 to 2000. The data base contains firm-level information on size, profitability, productivity, size, job turnover, union membership, competitiveness, etc. In addition, based on individual information and firm indicators we are able to generate firm variables measuring the composition of the employees, like level and type of education, age and gender shares, etc. Our preliminary results indicate that there are significant effects of firm characteristics, and that industry restructuring adds to the explanation of the observed cyclical fluctuations in sickness absenteeism. The estimates partly depend on the estimation method, in particular the specification of unobserved heterogeneity on individual and firm level. Finally, policy implications of the different causes of absenteeism and their relative importance are discussed.