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A Review of the Recent Empirical Literature on Displaced Workers

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  • Bruce C. Fallick

Abstract

This article reviews the empirical literature on job displacement. Job displacement is widespread and strongly countercyclical (tending to peak during economic downturns), but concentrated in industries and states that are doing poorly, relative either to other industries and states or to their own prior performance. Displaced workers experience more nonemployment than do nondisplaced workers, but the difference fades after about four years. In contrast, earnings losses of displaced workers are large and persistent. Outcomes for all displaced workers are heavily influenced by broader economic conditions, and are affected very little by workers' demographic characteristics. The effects of advance notice are not yet clear.

Suggested Citation

  • Bruce C. Fallick, 1996. "A Review of the Recent Empirical Literature on Displaced Workers," ILR Review, Cornell University, ILR School, vol. 50(1), pages 5-16, October.
  • Handle: RePEc:sae:ilrrev:v:50:y:1996:i:1:p:5-16
    DOI: 10.1177/001979399605000101
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    1. Addison, John T & Portugal, Pedro, 1989. "Job Displacement, Relative Wage Changes, and Duration of Unemployment," Journal of Labor Economics, University of Chicago Press, vol. 7(3), pages 281-302, July.
    2. William J. Carrington, 1993. "Wage Losses for Displaced Workers: Is It Really the Firm That Matters?," Journal of Human Resources, University of Wisconsin Press, vol. 28(3), pages 435-462.
    3. John T. Addison & McKinley L. Blackburn, 1994. "The Worker Adjustment and Retraining Notification Act," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 181-190, Winter.
    4. Ronald G. Ehrenberg & George H. Jakubson, 1988. "Advance Notice Provisions in Plant Closing Legislation: Do They Matter?," NBER Working Papers 2611, National Bureau of Economic Research, Inc.
    5. Duane E. Leigh, 1995. "Assisting Workers Displaced by Structural Change: An International Perspective," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number awd, December.
    6. Topel, Robert, 1990. "Specific capital and unemployment: Measuring the costs and consequences of job loss," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 33(1), pages 181-214, January.
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