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Trend Employment Growth and the Bunching of Job Creation and Destruction

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  • Christopher L. Foote

Abstract

Research using US manufacturing data finds that job destruction fluctuates more over time than job creation, but some new data indicates that this behavior is not shared in growing sectors, where job creation varies more. An explanation for this finding based on the interaction between (S,s)-type adjustment and trend employment growth delivers some tight predictions for the relationship between trend growth and the volatility of creation relative to destruction. Though it scores some notable successes, the simple (S,s)-based model augmented with a low-frequency trend cannot fully account for the strength of the empirical relationship between relative gross-flow volatility and trend growth across one--digit industries.

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Bibliographic Info

Paper provided by Harvard - Institute of Economic Research in its series Harvard Institute of Economic Research Working Papers with number 1818.

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Date of creation: 1998
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Handle: RePEc:fth:harver:1818

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