Labor Market Turnover Research Articles

Labor market power and worker turnover

The last two decades have seen a significant decrease in labor market turnover and an increase in labor market concentration. We investigate whether labor market power, as manifested by employer concentration and outside options, affect turnover rates. Utilizing online vacancy posting data, we find that moving from the 25th percentile to 75th percentile of employer concentration reduces the turnover rate by 5%, driven by high-school workers in low-skill industries. The same exercise for outside options implies a 39% increase in the turnover rate, driven by workers in high-skill industries.

The relationship between women's empowerment and staff turnover in the Egyptian hospitality labor market

PurposeAlthough the hospitality sector is considered the most active and profitable sector in the Egyptian economy, it suffers from the non-stop immigration of skilled manpower and the high rates of labor turnover. One of the apparent solutions for this problem that could be implemented is empowering Egyptian females to play an active role in the success of this sector. Females faced many obstacles while working in hospitality, including prevailing social perception, the culture of shame, the traditional negative view of feminine hoteliers, long working hours and the shift system, which led to weak females' desire to enroll in the hospitality field. The study aims to determine how empowering Egyptian women in the hospitality industry affects staff turnover.Design/methodology/approachTo achieve the aim of the study, a sample of four- and five-star resorts in Red Sea, Egypt, was under study. A self-administrated questionnaire was addressed to female hotel employees, and 140 forms were statistically analyzed in addition to 14 semi-structured interviews with hospitality experts.FindingsThe study recommends that hotels should start re-tailoring policies to activate Egyptian females' role in reducing the high rate of hospitality labor turnover through increasing their work engagement (WENG) (as a mediator) by adopting a decent work environment and motivating them to get promoted to hold senior positions.Research limitations/implicationsIn spite of some noteworthy contributions, the authors would like to point out certain shortcomings. The sample was homogeneous, consisting of female hotels employees in Egypt, but the findings are generalizable to other Arabian communities. Nonetheless, the authors feel that they have supplied some suggestive evidence, even for the most careful reader who wants to further study these elements of working attitudes in the hotel business.Originality/valueAccording to the authors' knowledge, this study is among the few studies covering females' reluctance to continue working in the hospitality field.

Job Satisfaction and the ‘Great Resignation’: An Exploratory Machine Learning Analysis

Labor market dynamics is shaped by various social, psychological and economic drivers. Studies have suggested that job quit and labor market turnover are associated with job satisfaction. This study examines the determinants of job satisfaction using a large survey dataset, namely the LISS Work and Schooling module on an extensive sample of persons from the Netherlands. To handle these big data, machine learning models based on binary recursive partitioning algorithms are employed. Particularly, sequential and randomized tree-based techniques are used for prediction and clustering purposes. In order to interpret the results, the study calculates the sizes and directions of the effects of model features using computations based on the concept of Shapley value in cooperative game theory. The findings suggest that satisfaction with the social atmosphere among colleagues, wage satisfaction, and feeling of being appreciated are major determinants of job satisfaction.

Human capital pipelines – antecedents and consequences

PurposeThis paper aims to discuss the concept of human capital pipelines and explain how pipelines originate and the consequences of pipeline-based hiring in terms of labor market uncertainty, job embeddedness, social ties, homosocial reproduction, employee referrals and turnover intent.Design/methodology/approachThe author provides a viewpoint grounded on a review of recent research regarding human capital pipelines.FindingsThis paper aims at further developing our understanding of human capital pipelines and the implications of such practices. The author points out both the positive and negative aspects of pipeline-based hiring, with the hope that human resource practitioners and mangers will adopt such practices based on the organization’s strategic needs.Originality/valueTo date, very little conceptual and/or empirical work has been carried out on pipeline-based hiring. In organizations, it is important to understand how repeated hiring from labor sources can reduce labor market uncertainty regarding a job seeker’s quality and potential productivity. However, it is also crucial to appreciate that such practices may have important pre and posthire implications for organizations and employees alike.

Bonus Season: A Theory of Periodic Labor Markets and Coordinated Bonuses

We present a general equilibrium model in which firms and workers coordinate compensation so that turnover is high in some periods and low in others. This ensures that firms and workers typically search for new matches when other firms and workers are available. If firms and workers find themselves in a periodic equilibrium, contracts often feature large bonuses paid just prior to periods of high labor market turnover. The theory’s predictions match stylized facts concerning compensation and turnover in high finance and biglaw. This paper was accepted by Gustavo Manso, finance.

Declining Worker Turnover: The Role of Short-Duration Employment Spells

Using the Quarterly Workforce Indicators database, we document that a significant amount of the decline in labor market turnover during the last two decades is accounted for by the decline in employment spells that last just one or two quarters. This phenomenon is pervasive: short-term employment spells have declined across industries, firm size categories, demographic groups, and geographic regions. Using a search-and-matching model in the Diamond-Mortensen-Pissarides tradition that incorporates noisy signals about the quality of a worker-firm match, we argue that improved screening by workers and firms can account for much of the decline in short-lived employment spells. (JEL E24, J23, J41, J63, M51)

Fiscal Integration in an Experimental Union: How Path-Breaking Was the EU's Response to the COVID-19 Pandemic?

Fiscal Integration in an Experimental Union: How Path-Breaking Was the EU's Response to the COVID-19 Pandemic?

Job Specialization and Labor Market Turnover

This paper studies the decline in labor market turnover over recent decades, in particular, the job finding and separation rates. I analyze the role of an increase in specialization of jobs in accounting for this decline, where specialization is defined as the impact of mismatch on match productivity. Combining individual level data from NLSY79 and NLSY97 with data on skills from ASVAB and O*NET, I empirically estimate job specialization and show that the specialization has increased over time. To quantify the impact of this increasing specialization on labor market turnover, I build an equilibrium search and matching model with two-sided ex-ante heterogeneity and endogenous separations. The calibrated model shows that higher job specialization leads to a decline in both job finding and separation rates. As specialization increases, firms and workers become more selective in forming matches. Thus, well-matched firms and workers choose to remain in their matches longer, while bad matches get destroyed faster. Since higher specialization leads to an increase in the proportion of good matches in the economy, it results in a decline in the labor market turnover.

호텔 기업 노동시장 유연성, 조직냉소주의, 이직의도 간 구조적 관계 : 서울 시내 5성급 호텔을 중심으로

본 연구는 호텔 기업 노동시장의 유연성, 구성원들의 조직냉소주의 및 이직의도 간 구조적관계를 확인하고자 하였다. 본 연구의 목적을 달성하기 위하여 문헌연구를 바탕으로 국내 호텔기업과 관련하여 노동시장 유연성, 구성원들의 조직냉소주의 및 이직의도와 관련된 속성을 도출하였다. 이러한 속성을 토대로 본 연구의 실증분석을 위해 7개 5성급 호텔의 구성원을 대상으로 하여 총 288부의 유효 설문지가 빈도 분석, 확인적 요인분석 및 신뢰도 검증, 상관관계분석, 구조방정식모형 분석을 위해 사용되었다. 본 연구의 실증분석에 대한 결과를 다음과 같이 제시하고자 한다. 첫째, 노동시장 유연성의 하위변수인 수량적 유연성, 기능적 유연성은 구성원들의 조직에 대한 냉소주의에 유의한 정(+)의 영향을 미치는 것으로 나타났다. 그러나, 임금 유연성은 기각되었다. 둘째, 노동시장 유연성의 하위변수인 수량적 유연성 및 기능적 유연성은 구성원들의 이직의도에 유의한 정(+)의 영향을 미치는 것으로 분석되었다. 그러나, 임금 유연성은 이직의도에 영향을 미치지 않는 것으로 분석되었다. 마지막으로, 구성원들의 조직에 대한 냉소주의는 이직의도에 유의한 정(+)의 영향을 미치는 것으로 나타났다. 따라서 호텔 기업은 노동시장의 유연성을 지속적으로 실행함으로써 기업 경쟁력의 핵심지표라 할 수 있는 기업 가치를 증대시킬 수 있다. 그러나, 과도한 유연성의 실행은 조직에 대한 구성원들의 저항, 불신을 가져올 수 있으며, 나아가 조직에 대한 냉소주의 및 타 호텔로의 이직을 고착시킬 수 있다. 즉, 호텔 기업은 구성원들이 노동시장 유연성 제도의 혁신 및 중요성을 공감할 수 있는 노력을 기울여야 한다.

Labour market turnover in Latin America: How intensive is it and to what extent does it differ across countries?

AbstractThe study of labour market turnover is particularly significant in Latin America, which is characterized by marked economic cycles and limited social protection coverage. This article estimates the intensity of transitions from employment in six countries in Latin America in the new millennium and decomposes the differences observed, furthermore evaluating the employment destinations of workers making such transitions. The countries under analysis show very different turnover rates, which are mostly explained by a dissimilar incidence of informal and temporary employment. In all cases, a large share of job exits imply transitions to precarious jobs or unemployment.

Salary History Ban: Gender Pay Gap and Spillover Effects

We study the effect of the US salary history ban which restricts employers from inquiring about applicants' pay history during the hiring process. We find that the bans reduce gender pay gap by 4.2% points in hourly wages, and by 4.5% points in weekly earnings. About 40% of the reduction in the weekly earnings gap comes from a decrease in the earnings of mostly middle-aged men. The increase in female earnings comes from both young and middle-aged women with at least some college education. While the gender pay gap closes in the private sector, public sector gaps increase, primarily because of an increase in men's earnings. We do not find any evidence for spillover effects of public sector bans in the private sector. In contrast, salary history bans for private employers generate negative spillover effects for public sector workers by reducing their earnings. We do not detect any effects of the ban on labor market participation and turnover rates.

Director networks, turnover, and appointments

AbstractThis paper analyzes the labor market (turnover and appointments) of executive and non‐executive directors by means of social network methodology. We find that directors with strong networks are able to obtain labor market information that enables them to leave their firm more easily for better opportunities. Networks also mitigate information asymmetry problems of external director appointments. Furthermore, the strong impact of indirect connections is in line with the ‘strength of the weak ties’ theory. The fact that direct connections are less important signifies that the connections to people that are close and local are likely to convey redundant information, whereas connections to distant individuals are more efficient in terms of information acquisition and labor market performance improvement.

Automatic enrollment and job market turnover

AbstractAutomatic enrollment has substantially increased employee participation in defined contribution plans. Yet little is known about how retirement plan design features influence retirement wealth accumulation in a setting of labor market turnover. We find that employees separating from jobs with automatic enrollment plans are significantly more likely to take a cash distribution (and potentially pay a tax penalty) than those separating from jobs with voluntary enrollment plans, offsetting some of the benefits from automatic enrollment. Yet given the sizeable improvements in plan participation from automatic enrollment, wealth accumulation for automatically enrolled participants, net of cash-outs and penalties, remain higher than it would have been under voluntary enrollment.

The Cyclical Job Ladder

Many theories of labor market turnover generate a job ladder. Due to search frictions, workers earn rents from employment. All workers agree on which jobs are, in this sense, more desirable and slowly climb the job ladder through job-to-job quits. Occasionally, negative shocks throw them off the ladder and back into unemployment. We review a recent body of theory and empirical evidence on labor market turnover through the lens of the job ladder. We focus on the critical role that the job ladder plays in transmitting aggregate shocks, through the pace and direction of employment reallocation, to economic activity and wages and in shaping business cycles more generally. The main evidence concerns worker transitions, both through nonemployment and from job to job, between firms of different sizes, ages, productivity levels, and wage premiums, as well as the resulting earnings growth. Poaching by firms up the ladder is the main engine of reallocation, which shuts down in recessions.

Director Networks, Turnover, and Appointments

This paper analyzes the labor market (turnover and appointments) of executive and non-executive directors by means of social network methodology. We find that directors with strong networks are able to obtain labor market information that enables them to leave their firm more easily for better opportunities. Networks also mitigate information asymmetry problems of external director appointments. Furthermore, the strong impact of indirect connections is in line with the ‘strength of the weak ties’ theory. The fact that direct connections are less important signifies that the connections to people that are close and local are likely to convey redundant information, whereas connections to distant individuals are more efficient in terms of information acquisition and labor market performance improvement.

Worker mobility in a search model with adverse selection

We analyze the effects of adverse selection on worker turnover and wage dynamics in a frictional labor market. We consider a model of on-the-job search where firms offer promotion wage contracts to workers of different abilities, which is unknown to firms at the hiring stage. With sufficiently strong information frictions, low-wage firms offer separating contracts and hire all types of workers in equilibrium, whereas high-wage firms offer pooling contracts, promoting high-ability workers only. Low-ability workers have higher turnover rates and are more often employed in low-wage firms. The model replicates the negative relationship between job-to-job transitions and wages observed in the U.S. labor market.

Análisis dinámico de trayectorias laborales a través del concepto de flexiguridad

El artículo realiza un análisis dinámico para conocer si el mercado laboral español responde a las características de los mercados de trabajo transicionales, desde un enfoque de flexiguridad. A través de la Muestra Continua de Vidas Laborales se estudian las trayectorias de los trabajadores españoles durante el período 2007-2010, que abarca el final de la expansión de la economía española y el comienzo de la actual crisis de empleo. De la conjunción del tema elegido, el enfoque y la base de datos utilizada, resulta una perspectiva novedosa en nuestro país. Se ofrece evidencia empírica de la evolución de los episodios de empleo y paro, del grado de rotación del mercado laboral español y de las dificultades de determinados colectivos para realizar transiciones en y hacia el empleo. Los resultados muestran un mercado de trabajo en el que a) las transiciones se encuentran bloqueadas, y b) existe una alta inseguridad laboral.

Crime and labour market turnover

ABSTRACTWe go beyond unemployment to investigate how its determinants, specifically hires, lay-offs and quits, affect crime. As expected, we find less crime in localities with higher hiring and quit rates and lower lay-off rates. The size of relationships is on the order of studies analysing the link between unemployment and crime.

Worker Mobility in a Search Model with Adverse Selection

We analyze the effects of adverse selection on worker turnover and wage dynamics in a frictional labor market. We consider a model of on-the-job search where firms offer promotion wage contracts to workers of different ability, which is unknown to firms at the hiring stage. With sufficiently strong information frictions, low-wage firms offer separating contracts and hire all types of workers in equilibrium, whereas high-wage firms offer pooling contracts, promoting high-ability workers only. Low-ability workers have higher turnover rates and are more often employed in low-wage firms. The model replicates the negative relationship between job-to-job transitions and wages observed in the U.S. labor market.

Um indicador de não satisfação no trabalho e a mobilidade do mercado de trabalho: um estudo para homens e mulheres

Existem evidências na literatura internacional de que medidas de não satisfação no trabalho podem funcionar como boas preditoras para as saídas do mercado de trabalho. Desta forma, essas medidas seriam informativas para o entendimento das diferenças de mobilidade no mercado de trabalho entre homens e mulheres, complementando outros indicadores de trabalho comumente utilizados. Os trabalhadores insatisfeitos na ocupação são provavelmente os que mais contribuem para o aumento da rotatividade no mercado de trabalho, sendo mais vulneráveis ao desemprego, à inatividade ou à inserção de forma autônoma. Utilizaremos como proxy para a não satisfação no trabalho a variável que identifica se o indivíduo ocupado tomou alguma providência para conseguir trabalho. Nossos resultados mostram que a insatisfação no trabalho é um determinante importante da probabilidade de o trabalhador ficar inativo ou desempregado e de transitar para uma ocupação autônoma.