The Incidence and Persistence of Cyclical Job Loss in New Zealand
In New Zealand, the impact of the Global Financial Crisis (GFC) was milder than in most other developed countries, with employment declining by 2.5 percent between 2008q4 and 2009q4. Job and worker turnover rates both declined, signalling a reduction in labour market liquidity and difficulties for new entrants and high-turnover groups of workers (Fabling and Maré, 2012). The current paper documents the extent and composition of employment change between 2000 and 2011, focusing on the 2008-2010 period, when the labour market impacts of the GFC were strongest. As in previous downturns, the incidence of cyclical job loss and unemployment fell disproportionately on young and unskilled workers. The paper identifies, by age, gender and earnings level, the sensitivity of employment growth and labour market flows to aggregate employment fluctuations and also to relative fluctuations across industries and regions. The accession rate is particularly sensitive to the economic cycle, most strongly for young workers. Differences in the size of cyclical employment fluctuations reflect differing responsiveness to common shocks and not exposure to different industry and local shocks. Finally, the paper traces outcomes for workers whose jobs end, summarising their duration out of work and the wage increases or reductions they experience when they secure employment. Workers who left or lost jobs spent longer out of work after the GFC and settled for lower earnings growth when they did find a job. Both of these effects had partly but not fully abated within 3 years of the onset of the GFC.
|Date of creation:||Nov 2013|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hilary W. Hoynes & Douglas L. Miller & Jessamyn Schaller, 2012.
"Who Suffers During Recessions?,"
NBER Working Papers
17951, National Bureau of Economic Research, Inc.
- Papps, Kerry L. & Newell, James O., 2002. "Identifying Functional Labour Market Areas in New Zealand: A Reconnaissance Study Using Travel-to-Work Data," IZA Discussion Papers 443, Institute for the Study of Labor (IZA).
- Gielen, A. C. & van Ours, J.C., 2005.
"Age-specific Cyclical Effects in Job Reallocation and Labor Mobility,"
2005-86, Tilburg University, Center for Economic Research.
- Gielen, Anne C. & van Ours, Jan C., 2006. "Age-specific cyclical effects in job reallocation and labor mobility," Labour Economics, Elsevier, vol. 13(4), pages 493-504, August.
- Gielen, Anne & van Ours, Jan C, 2005. "Age-Specific Cyclical Effects in Job Reallocation and Labour Mobility," CEPR Discussion Papers 5161, C.E.P.R. Discussion Papers.
- Gielen, Anne C. & van Ours, Jan C., 2005. "Age-Specific Cyclical Effects in Job Reallocation and Labor Mobility," IZA Discussion Papers 1670, Institute for the Study of Labor (IZA).
- Steven J. Davis & R. Jason Faberman & John Haltiwanger, 2006.
"The Flow Approach to Labor Markets: New Data Sources and Micro-Macro Links,"
Journal of Economic Perspectives,
American Economic Association, vol. 20(3), pages 3-26, Summer.
- Steven J. Davis & R. Jason Faberman & John Haltiwanger, 2006. "The Flow Approach to Labor Markets: New Data Sources and Micro-Macro Links," NBER Working Papers 12167, National Bureau of Economic Research, Inc.
- Couch, Kenneth A. & Fairlie, Robert W., 2008.
"Last Hired, First Fired? Black-White Unemployment and the Business Cycle,"
IZA Discussion Papers
3713, Institute for the Study of Labor (IZA).
- Kenneth Couch & Robert Fairlie, 2010. "Last hired, first fired? black-white unemployment and the business cycle," Demography, Springer, vol. 47(1), pages 227-247, February.
- Kenneth A. Couch & Robert Fairlie, 2005. "Last Hired, First Fired? Black-White Unemployment and the Business Cycle," Working papers 2005-50, University of Connecticut, Department of Economics.
- Steve J. Davis & John Haltiwanger, 1991.
"Gross job creation, gross job destruction and employment reallocation,"
Working Paper Series, Macroeconomic Issues
91-5, Federal Reserve Bank of Chicago.
- Davis, Steven J & Haltiwanger, John C, 1992. "Gross Job Creation, Gross Job Destruction, and Employment Reallocation," The Quarterly Journal of Economics, MIT Press, vol. 107(3), pages 819-63, August.
- Steve J. Davis & John Haltiwanger, 1991. "Gross Job Creation, Gross Job Destruction and Employment Reallocation," NBER Working Papers 3728, National Bureau of Economic Research, Inc.
- Mary C. Daly & Bart Hobijn & Aysegül Sahin & Robert G. Valletta, 2012. "A Search and Matching Approach to Labor Markets: Did the Natural Rate of Unemployment Rise?," Journal of Economic Perspectives, American Economic Association, vol. 26(3), pages 3-26, Summer.
- Derek Neal, 1998.
"The Complexity of Job Mobility Among Young Men,"
NBER Working Papers
6662, National Bureau of Economic Research, Inc.
- Rebecca Craigie & David Gillmore & Nicolas Groshenny, 2012. "Matching workers with jobs:how well is the New Zealand labour market doing?," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 75, pages 3-12, December.
- Shin, Donggyun, 2000. "Gender and Industry Differences in Employment Cyclicality: Evidence Over the Postwar Period," Economic Inquiry, Western Economic Association International, vol. 38(4), pages 641-50, October.
- Richard B. Freeman, 1973. "Changes in the Labor Market for Black Americans, 1948-72," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 4(1), pages 67-132.
- Richard Fabling & David C. Maré, 2012. "Cyclical Labour Market Adjustment in New Zealand: The Response of Firms to the Global Financial Crisis and its Implications for Workers," Working Papers 12_04, Motu Economic and Public Policy Research.
- Robert Shimer, 2007.
"Reassessing the Ins and Outs of Unemployment,"
NBER Working Papers
13421, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp7745. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)
If references are entirely missing, you can add them using this form.