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Who benefits from a job change: The dwarfs or the giants?

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  • FOUARGE Didier
  • MUFFELS Ruud
  • PAVLOPOULOS Dimitris
  • VERMUNT Jeroen K.

Abstract

Empirical studies have shown that voluntary job-to-job changes have a positive effect on wage mobility. In this paper, we suggest that the impact of a job change on wage growth depends on the position in the wage distribution. Using panel data from the UK and Germany, we investigate the effect of employer changes and within-firm job changes on year-to-year wage mobility. We show that a change of employer results into a wage increase for the low-paid workers but not for the high-paid workers. Within-firm job changes produce, on average, moderate wage gains for the low-paid workers in the UK, but have no effect in Germany. Results on 3-year wage mobility are shown to be very similar to the results on year-to-year wage growth.

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  • FOUARGE Didier & MUFFELS Ruud & PAVLOPOULOS Dimitris & VERMUNT Jeroen K., 2007. "Who benefits from a job change: The dwarfs or the giants?," IRISS Working Paper Series 2007-16, IRISS at CEPS/INSTEAD.
    • Handle: RePEc:irs:iriswp:2007-16
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    1. Adele Bergin, 2015. "Employer Changes and Wage Changes: Estimation with Measurement Error in a Binary Variable," LABOUR, CEIS, vol. 29(2), pages 194-223, June.
    2. María Cervini-Plá & Antonia López-Villavicencio & José Ignacio Silva, 2015. "The heterogeneous cyclicality of income and wages among the distribution," Working Papers halshs-01133823, HAL.
    3. Johannes Wieschke, 2018. "Frequency of employer changes and their financial return: gender differences amongst German university graduates," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 52(1), pages 1-13, December.
    4. Lorenzo Corsini, 2012. "Institutions, Technological Change and Wage Differentials between Skilled and Unskilled Workers: Theory and Evidence from Europe," Research in Labor Economics, in: Research in Labor Economics, pages 1-33, Emerald Group Publishing Limited.
    5. Wieschke, Johannes, 2018. "Frequency of employer changes and their financial return: gender differences amongst German university graduates," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 52(1), pages 1-1.
    6. Filandri, Marianna & Struffolino, Emanuela, 2019. "Individual and household in-work poverty in Europe: understanding the role of labor market characteristics," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 21(1), pages 130-157.
    7. Mattia Filomena, 2021. "Unemployment Scarring Effects: A Symposium On Empirical Literature," Working Papers 453, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    8. Argaw, Bethlehem A. & Maier, Michael F. & Skriabikova, Olga J., 2017. "Risk attitudes, job mobility and subsequent wage growth during the early career," ZEW Discussion Papers 17-023, ZEW - Leibniz Centre for European Economic Research.
    9. Adele Bergin, 2013. "Job Changes and Wage Changes: Estimation with Measurement Error in a Binary Variable," Economics Department Working Paper Series n240-13.pdf, Department of Economics, National University of Ireland - Maynooth.
    10. PREJMEREAN Mihaela Cornelia & VASILACHE Simona, 2008. "What's a univesity worth? Changes in the lifestyle and status of post-2000 European Graduates," IRISS Working Paper Series 05, IRISS at CEPS/INSTEAD.
    11. Wieschke, Johannes, 2018. "Frequency of employer changes and their financial return: gender differences amongst German university graduates," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 52(1), pages .1(1-13).
    12. Marina Checa-Olivas & Bladimir de la Hoz-Rosales & Rafael Cano-Guervos, 2021. "The Impact of Employment Quality and Housing Quality on Human Development in the European Union," Sustainability, MDPI, vol. 13(2), pages 1-12, January.
    13. Prejmerean, Mihaela Cornelia & Vasilache, Simona, 2008. "What's a university worth? Changes in the lifestyle and status of post-2000 European Graduates," IRISS Working Paper Series 2008-05, IRISS at CEPS/INSTEAD.
    14. Mark Gius, 2014. "The impact of job mobility on earnings: using occupational and industrial classifications to identify job changes," International Review of Applied Economics, Taylor & Francis Journals, vol. 28(2), pages 181-190, March.
    15. Maier, Michael & Argaw, Bethlehem A. & Maier, Michael F. & Skriabikova, Olga J., 2016. "Risk attitudes, job mobility and subsequent wage growth during the early career," VfS Annual Conference 2016 (Augsburg): Demographic Change 145677, Verein für Socialpolitik / German Economic Association.

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    More about this item

    Keywords

    low pay; high pay; job mobility; wage mobility;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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