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What Do We Know About Worker Displacement in the U.S.?

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Author Info
Daniel S. Hamermesh

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Abstract

In the United States roughly one-half million workers with 3+ years on the job have become unemployed each year during the 1980s because of plant closings. There is evidence that this represents an increase over earlier periods of similar macroeconomic conditions. Wage cuts within the observed range lower only slightly the probability that a plant will close. The average loss of earnings, due to long spells of post-displacement unemployment and to subsequent reduced wages, is substantial. While minorities suffer an above-average rate of displacement, the earnings losses they experience upon displacement are not disproportionately high. Women and older workers are no more likely than others to become displaced, and their losses are not disproportionate; but workers who have been on the job longer lose more.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 2402.

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Date of creation: Oct 1987
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Handle: RePEc:nbr:nberwo:2402

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References listed on IDEAS
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  1. Gene M. Grossman, 1986. "Imports as a Cause of Injury: The Case of the U.S. Steel Industry," NBER Working Papers 1494, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  2. Bale, Malcolm D., 1976. "Estimates of trade-displacement costs for U.S. workers," Journal of International Economics, Elsevier, vol. 6(3), pages 245-250, August. [Downloadable!] (restricted)
  3. Blau, Francine D & Kahn, Lawrence M, 1981. "Causes and Consequences of Layoffs," Economic Inquiry, Oxford University Press, vol. 19(2), pages 270-96, April.
  4. Hamermesh, Daniel S, 1987. "The Costs of Worker Displacement," The Quarterly Journal of Economics, MIT Press, vol. 102(1), pages 51-75, February. [Downloadable!] (restricted)
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