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The Extent and Cyclicality of Career Changes: Evidence for the UK

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Abstract

Using quarterly data for the U.K. from 1993 through 2012, we document that the extent of worker reallocation across occupations or industries (a career change, in the parlance of this paper) is high and procyclical. This holds true after controlling for workers' previous labour market status and for changes in the composition of who gets hired over the business cycle. Our evidence suggests that a large part of this reallocation reflect excess churning in the labour market. We also find that the majority of career changes come with wage increases. During the economic expansion wage increases were typically larger for those who change careers than for those who do not. During the recession this is not true for career changers who were hired from unemployment. Our evidence suggests that understanding career changes over the business cycle is important for explaining labour market ows and the cyclicality of wage growth.

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  • Carlos Carrillo-Tudela & Bart Hobijn & Powen She & Ludo Visschers, 2015. "The Extent and Cyclicality of Career Changes: Evidence for the UK," Edinburgh School of Economics Discussion Paper Series 258, Edinburgh School of Economics, University of Edinburgh.
  • Handle: RePEc:edn:esedps:258
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    Cited by:

    1. Fontaine, Idriss & Gálvez-Iniesta, Ismael & Gomes, Pedro & Vila-Martin, Diego, 2020. "Labour market flows: Accounting for the public sector," Labour Economics, Elsevier, vol. 62(C).
    2. Ronald Bachmann & Peggy Bechara & Christina Vonnahme, 2020. "Occupational Mobility in Europe: Extent, Determinants and Consequences," De Economist, Springer, vol. 168(1), pages 79-108, March.
    3. Peng, Congmin & She, Po-Wen, 2020. "Are women less likely to be managers in the UK labour market?," Economic Modelling, Elsevier, vol. 85(C), pages 317-324.
    4. Carlos Carrillo-Tudela & Eric Smith, 2017. "Search Capital," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 23, pages 191-211, January.
    5. Isaac Baley & Ana Figueiredo & Robert Ulbricht, 2018. "Mismatch Cycles," 2018 Meeting Papers 1098, Society for Economic Dynamics.
    6. Bauer, Anja & Lochner, Benjamin, 2016. "History dependence in wages and cyclical selection: evidence from Germany," IAB Discussion Paper 201629, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    7. Bauer, Anja & Lochner, Benjamin, 2020. "History dependence in wages and cyclical selection: Evidence from Germany," Labour Economics, Elsevier, vol. 67(C).
    8. Grjebine, Thomas & Szczerbowicz, Urszula & Tripier, Fabien, 2018. "Corporate debt structure and economic recoveries," European Economic Review, Elsevier, vol. 101(C), pages 77-100.
    9. Kenneth Burdett & Carlos Carrillo-Tudela & Melvyn Coles, 2020. "The Cost of Job Loss," Review of Economic Studies, Oxford University Press, vol. 87(4), pages 1757-1798.
    10. Carl Singleton, 2018. "Long‐Term Unemployment and the Great Recession: Evidence from UK Stocks and Flows," Scottish Journal of Political Economy, Scottish Economic Society, vol. 65(2), pages 105-126, May.
    11. Bauer, Anja & King, Ian, 2018. "The Hartz reforms, the German Miracle, and labor reallocation," European Economic Review, Elsevier, vol. 103(C), pages 1-17.
    12. Paul Gaggl & Greg C. Wright, 2017. "A Short-Run View of What Computers Do: Evidence from a UK Tax Incentive," American Economic Journal: Applied Economics, American Economic Association, vol. 9(3), pages 262-294, July.
    13. Fraser Summerfield & Ioannis Theodossiou, 2017. "The Effects Of Macroeconomic Conditions At Graduation On Overeducation," Economic Inquiry, Western Economic Association International, vol. 55(3), pages 1370-1387, July.
    14. Carlos Carrillo-Tudela & Bart Hobijn & Patryk Perkowski & Ludo Visschers, 2015. "Majority of hires never report looking for a job," FRBSF Economic Letter, Federal Reserve Bank of San Francisco.
    15. Giovanni Razzu & Carl Singleton, 2018. "Segregation and Gender Gaps in the United Kingdom's Great Recession and Recovery," Feminist Economics, Taylor & Francis Journals, vol. 24(4), pages 31-55, October.
    16. Bauer, Anja, 2015. "Reallocation patterns across occupations," IAB Discussion Paper 201526, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    17. Albertini, Julien & Hairault, Jean-Olivier & Langot, François & Sopraseuth, Thepthida, 2017. "A Tale of Two Countries: A Story of the French and US Polarization," IZA Discussion Papers 11013, Institute of Labor Economics (IZA).
    18. Giovanni Razzu & Carl Singleton, 2015. "Segregation and Gender Gaps through the UK's Great Recession," Economics Discussion Papers em-dp2015-02, Department of Economics, University of Reading.

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    More about this item

    Keywords

    labour market turnover; occupational and industry mobility; wage growth;
    All these keywords.

    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
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)

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