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Labour market dynamics following a regional disaster

Author

Listed:
  • Richard Fabling
  • Arthur Grimes

    ()

  • Levi Timar

Abstract

The 2010/2011 Canterbury earthquakes caused major upheaval to the people of the region. The second major quake killed 185 people, forced many from their homes, and closed Christchurch's central business district. This paper examines the consequential effect on jobs and accumulated earnings for workers in Canterbury. In addition, we examine concurrent decisions about employment location, including job-to-job transitions and regional migration. While Canterbury workers' employment outcomes were adversely affected in the short-run, those workers were more likely to have jobs three years later (relative to a matched control group), and to have higher accumulated earnings. At the same time, they were less likely to be at the same employer, and more likely to have migrated to jobs in other New Zealand regions. Impacts vary substantially by worker characteristics and by the naturally-induced geographic variation in the severity of the shock. We show that the Earthquake Support Subsidy appears to have influenced the extent of outward migration decisions, at least for a subset of workers, though not the long-term retention of the pre-quake job under which the subsidy was gained. We interpret these findings as evidence that the subsidy - by delaying job displacement - achieved its goal of giving employees in badly affected firms more time to assess their options.

Suggested Citation

  • Richard Fabling & Arthur Grimes & Levi Timar, 2016. "Labour market dynamics following a regional disaster," ERSA conference papers ersa16p50, European Regional Science Association.
  • Handle: RePEc:wiw:wiwrsa:ersa16p50
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    File URL: http://www-sre.wu.ac.at/ersa/ersaconfs/ersa16/Paper50_ArthurGrimes.pdf
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    Cited by:

    1. Maribel Jiménez Martínez & Mónica Jiménez Martínez & Rocío Romero-Jarén, 2020. "How resilient is the labour market against natural disaster? Evaluating the effects from the 2010 earthquake in Chile," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 104(2), pages 1481-1533, November.
    2. Sally Owen & Ilan Noy & Jacob Pástor-Paz & David Fleming, 2019. "EQC and extreme weather events (part 2): Measuring the impact of insurance on New Zealand landslip, storm and flood recovery using nightlights," Working Papers 19_19, Motu Economic and Public Policy Research.

    More about this item

    Keywords

    Earthquake; regional disaster; labour market dynamics; Christchurch;
    All these keywords.

    JEL classification:

    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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