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Time out of work and skill depreciation

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  • Edin, Per-Anders

    ()
    (IFAU - Institute for Labour Market Policy Evaluation)

  • Gustavsson, Magnus

    ()
    (Department of Economics , Uppsala University)

Abstract

This paper investigates the role of skill depreciation in the relationship between work interruptions and subsequent wages. Using unique longitudinal microdata containing information on the ability to understand and practically employ printed information, we are able to analyze changes in skills for individuals as a function of time out of work. In general, we find statistically strong evidence of a negative relationship between work interruptions and skills. Our analysis suggests that depreciation of general information-processing skills is economically significant, with a full year of non-employment being equivalent to moving 5 percentiles down the skill distribution.

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Bibliographic Info

Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2005:21.

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Length: 35 pages
Date of creation: 01 Sep 2005
Date of revision:
Publication status: Published in Industrial and Labor Relations Review, 2008, pages 163-180.
Handle: RePEc:hhs:ifauwp:2005_021

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Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden
Phone: (+46) 18 - 471 70 70
Fax: (+46) 18 - 471 70 71
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Web page: http://www.ifau.se/
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Keywords: Work interruptions; skill depreciation; wage differentials;

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