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Do neighbors help finding a job? Social networks and labor market outcomes after plant closures

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  • Jahn, Elke
  • Neugart, Michael

Abstract

This paper investigates whether the employment status of neighbors influences the employment probability of workers who lost their job due to a plant closure, and the channels through which this occurs. Combining rich spatial information with administrative records, we find that a 10 percentage points higher neighborhood employment rate increases the probability of finding a job by 1.9%. Displaced workers not only benefit from neighborhood networks in terms of higher earnings and longer job stability but they are also more likely to find a job at the plant of a neighbor. These results indicate that neighbors refer workers to employers and that social norms are less likely to play a role.

Suggested Citation

  • Jahn, Elke & Neugart, Michael, 2020. "Do neighbors help finding a job? Social networks and labor market outcomes after plant closures," Labour Economics, Elsevier, vol. 65(C).
    • Handle: RePEc:eee:labeco:v:65:y:2020:i:c:s0927537120300300
    DOI: 10.1016/j.labeco.2020.101825
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    Cited by:

    1. Philippe Askenazy & Verónica Escudero, 2022. "The Geographical Dimension of Inequalities in Access to Employment," Post-Print halshs-04828621, HAL.
    2. Adan Silverio‐Murillo & Lauren Hoehn‐Velasco & Jose Roberto Balmori de la Miyar, 2023. "Disputes between neighbors in Mexican cities during the COVID‐19 pandemic," Regional Science Policy & Practice, Wiley Blackwell, vol. 15(3), pages 626-643, April.
    3. Peter Haller & Daniel F. Heuermann, 2020. "Opportunities and competition in thick labor markets: Evidence from plant closures," Journal of Regional Science, Wiley Blackwell, vol. 60(2), pages 273-295, March.
    4. Ostermann, Kerstin & Eppelsheimer, Johann & Gläser, Nina & Haller, Peter & Oertel, Martina, 2022. "Geodata in labor market research: trends, potentials and perspectives," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 56, pages 1-5.
    5. Philippe Askenazy & Verónica Escudero, 2022. "Dimension géographique des inégalités d’accès à l’emploi," Post-Print halshs-03801734, HAL.

    More about this item

    Keywords

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    JEL classification:

    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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