Unemployment and Effort at Work

Abstract

We measure the sensitivity of work effort to local labour market conditions using self‐reported non‐work at the workplace in the American Time Use Survey (ATUS) 2003–12. Non‐work at work is quantitatively significant and varies positively with local unemployment, but in opposite directions at the extensive and intensive margins. The fraction of workers reporting positive values declines with unemployment, while time spent in non‐work conditional on any such time rises with unemployment. The results speak to issues of labour hoarding, efficiency wages and the cyclicality of labour productivity. We also demonstrate a relationship between the incidence of non‐work and unemployment benefits in state data linked to the ATUS. There are also pronounced occupational differences in the incidence and intensity of non‐work.