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Explaining the Increase in On-the-job Search

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  • Skuterud, Mikal

Abstract

Evidence from the Labour Force Survey (LFS) reveals that the percentage of employed workers searching for other jobs more than doubled in Canada between 1976 and 1995. Comparable evidence from the Current Population Survey (CPS), Panel Study of Income Dynamics (PSID), and National Longitudinal Survey (NLS) suggests that the U.S. experienced a remarkably similar upward trend in on-the-job search (OJS) over this period. Using U.S. data to supplement the Canadian data wherever possible, this paper attempts to explain this long-term, secular trend in Canadian OJS rates by performing decomposition and industry-level analyses, and by considering concomitant changes in employer-to-employer transition rates and the wage returns to job changing. The results from both countries suggest that an important part of the upward trend in OJS rates is not explained by compositional effects, including cohort effects. The OJS increase seems also to have occurred independently of rising job insecurity due to sector-specific demand shocks and trends in the dispersion of log wage residuals. The data are most consistent with a long-term decrease in search costs.

Suggested Citation

  • Skuterud, Mikal, 2005. "Explaining the Increase in On-the-job Search," Analytical Studies Branch Research Paper Series 2005250e, Statistics Canada, Analytical Studies Branch.
    • Handle: RePEc:stc:stcp3e:2005250e
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    File URL: https://www150.statcan.gc.ca/n1/en/catalogue/11F0019M2005250
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    References listed on IDEAS

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    1. Alan Manning & Ted To, 2002. "Oligopsony and Monopsonistic Competition in Labor Markets," Journal of Economic Perspectives, American Economic Association, vol. 16(2), pages 155-174, Spring.
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    Cited by:

    1. Therese Rebière, 2012. "Young workers' professional experience and access to high-skill jobs: a note," Economics Bulletin, AccessEcon, vol. 32(1), pages 969-980.
    2. Cornelißen, Thomas & Hübler, Olaf & Schneck, Stefan, 2007. "Cyclical Effects on Job-to-Job Mobility: An Aggregated Analysis on Microeconomic Data," Hannover Economic Papers (HEP) dp-371, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
    3. Frédéric Gavrel & Isabelle Lebon & Therese Rebière, 2010. "Career Paths, Unemployment, and the Efficiency of the Labor Market: Should Youth Employment Be Subsidized?," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(3), pages 533-560, June.

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    Keywords

    Employment and unemployment; Labour; Labour mobility; turnover and work absences; Work transitions and life stages;
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