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Worker Separations and Industry Instability

In: Productivity and Efficiency Analysis

Author

Listed:
  • Kim P. Huynh

    (Bank of Canada)

  • Yuri Ostrovsky

    (Statistics Canada)

  • Robert J. Petrunia

    (Lakehead University)

  • Marcel-Cristian Voia

    (Carleton University)

Abstract

This paper looks at the impact industry instability has on worker separations. Workers leave firms one of two ways: (i) voluntarily by quitting; or (ii) involuntarily through firm layoffs. Using data drawn from the Longitudinal Worker File, a Canadian firm-worker matched employment database, we are able distinguish between voluntary and involuntary separations using information on reasons for separations and assess the impact industry shutdown rates have on worker separation rates, both voluntarily and involuntarily. Once controlling for various factors and potential selection bias, we find that industry shutdown rates have a positive and significant effect on the overall separation, layoff and quit rates of workers. Finally, industry instability has a much larger impact on layoff rates when comparing voluntary and involuntary separations.

Suggested Citation

  • Kim P. Huynh & Yuri Ostrovsky & Robert J. Petrunia & Marcel-Cristian Voia, 2016. "Worker Separations and Industry Instability," Springer Proceedings in Business and Economics, in: William H. Greene & Lynda Khalaf & Robin Sickles & Michael Veall & Marcel-Cristian Voia (ed.), Productivity and Efficiency Analysis, edition 1, chapter 0, pages 161-174, Springer.
  • Handle: RePEc:spr:prbchp:978-3-319-23228-7_10
    DOI: 10.1007/978-3-319-23228-7_10
    as

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