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Earnings growth, job flows and churn

Author

Listed:
  • Tanaka, Satoshi
  • Warren, Lawrence
  • Wiczer, David
Abstract
How much do workers making job-to-job transitions benefit from moving away from a shrinking and towards a growing firm? Matched employer-employee data show that earnings growth in the transition increases with net employment growth at the destination firm and, to a lesser extent, decreases if the origin firm is shrinking. These results are not driven by composition, that different workers are going to growing or from shrinking firms, but rather implies that firm dynamics themselves are key to workers’ earnings growth during job-to-job transitions. Further, firms’ net employment growth rather than gross hires mostly drives the growth.

Suggested Citation

  • Tanaka, Satoshi & Warren, Lawrence & Wiczer, David, 2023. "Earnings growth, job flows and churn," Journal of Monetary Economics, Elsevier, vol. 135(C), pages 86-98.
    • Handle: RePEc:eee:moneco:v:135:y:2023:i:c:p:86-98
    DOI: 10.1016/j.jmoneco.2023.01.004
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    Cited by:

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    More about this item

    Keywords

    Firm dynamics; Job-to-Job transitions; Earnings growth;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions

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