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Assistant and auxiliary nurses in crisis times: earnings and employment following public sector job loss in the 1990s

This paper studies the earnings and employment consequences of involuntary job loss in Sweden during the crisis years of the 1990s among assistant and auxiliary nurses. These two occupational groups were by far those in the public sector that experienced the largest number of job losses. While public service employment traditionally has been perceived as secure and permanent, Sweden witnessed far-reaching restructuring of the public sector and job loss truly became a reality for public sector employees during these years. The estimates show an immediate annual earnings loss of on average about SEK 12 000 and long-term losses of SEK 5 000 per year. An analysis of the distributional effect shows that the job losses did not affect the whole earnings distribution but mostly the lower part. This suggests that a few bore the whole loss from downsizing but most went on unaffected at least considering earnings and employment. From a policy perspective this points to the importance to early identify these redundant workers and to develop targeted policies improving their situation instead of general policies to all redundant workers.

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Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2011:1.

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Length: 37 pages
Date of creation: 19 Jan 2011
Date of revision:
Publication status: Published as Eliason, Marcus, 'Assistant and auxiliary nurses in crisis times: Earnings, employment, and income effects of female job loss in the Swedish public sector' in International Journal of Manpower, 2014, pages 1159-1184.
Handle: RePEc:hhs:ifauwp:2011_001
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  1. Ruhm, Christopher J, 1991. "Are Workers Permanently Scarred by Job Displacements?," American Economic Review, American Economic Association, vol. 81(1), pages 319-24, March.
  2. Orley Ashenfelter & David Card, 1984. "Using the Longitudinal Structure of Earnings to Estimate the Effect of Training Programs," Working Papers 554, Princeton University, Department of Economics, Industrial Relations Section..
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  8. Marcus Eliason & Donald Storrie, 2006. "Lasting or Latent Scars? Swedish Evidence on the Long-Term Effects of Job Displacement," Journal of Labor Economics, University of Chicago Press, vol. 24(4), pages 831-856, October.
  9. Huttunen, Kristiina & Moen, Jarle & Salvanes, Kjell G., 2006. "How Destructive Is Creative Destruction? The Costs of Worker Displacement," IZA Discussion Papers 2316, Institute for the Study of Labor (IZA).
  10. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier.
  11. Anabela Carneiro & Pedro Portugal, 2006. "Earnings Losses of Displaced Workers: Evidence from a Matched Employer-employee Data Set," CEF.UP Working Papers 0607, Universidade do Porto, Faculdade de Economia do Porto.
  12. Stevens, Ann Huff, 1997. "Persistent Effects of Job Displacement: The Importance of Multiple Job Losses," Journal of Labor Economics, University of Chicago Press, vol. 15(1), pages 165-88, January.
  13. Jeffrey Smith & Petra Todd, 2003. "Does Matching Overcome Lalonde's Critique of Nonexperimental Estimators?," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers 20035, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
  14. Sara de la Rica, 1995. "Evidence of Preseparation Earnings Losses in the Displaced Worker Survey," Journal of Human Resources, University of Wisconsin Press, vol. 30(3), pages 610-621.
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