Wage Mobility Through Job Mobility
AbstractThe purpose of this paper is to study the relationship between job mobility and wage mobility. One of the main points of this paper is that job mobility is not necessarily bad. Job mobility might be the quickest way in which workers can advance in their careers and move up in the wage structure. Specifically I am going to distinguish between voluntary and involuntary job changes in both the modeling of job mobility behavior and the determination of the wage gains associated with job changing activities. Using the National Longitudinal Survey of Youth data, I find that workers voluntarily leave their jobs whenever they find themselves being paid below the customary wage rate. In particular, a worker that earns 30% less than the average wage for a worker with his characteristics and labor market experience is more than one and a half times as likely to initiate a separation than a worker just earning the average wage rate. Conversely, a worker earning 30% more than the average wage for a worker with his qualifications and labor market experience faces almost a 50% higher risk of being laid-off. This result is consistent across models. Workers' post-separation wage gains also depend on this distinction. Voluntary job changes lead, on average, to gains on the order of 7%, while layoffs imply losses of 5%. That is, voluntary separations, on average, allow workers to improve their relative position in the wage structure. Laid-off workers, however, tend to perform poorly after experiencing a separation. Fifty-percent of the laid-off workers experience wage losses, while 70% of the voluntary job changes end in wage gains. While at early stages of the career, workers experience large wage gains from quitting, these gains seem to disappear as their careers extends. Laid-off losses increase as the career extends, particularly for high-skilled workers.
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Bibliographic InfoPaper provided by Ilades-Georgetown University, Universidad Alberto Hurtado/School of Economics and Bussines in its series ILADES-Georgetown University Working Papers with number inv141.
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Other versions of this item:
- Marcela C. Perticara(Georgetown University/Ilades), 2004. "Wage Mobility Through Job Mobility," Working Papers gueconwpa~04-04-14, Georgetown University, Department of Economics.
- Marcela Perticara, 2004. "Wage Mobility Through Job Mobility," Econometric Society 2004 Latin American Meetings 204, Econometric Society.
- C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-12-02 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marcela Perticara).
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