The decline in labour mobility in the United States: Insights from new administrative
data
Job mobility is essential for a well-functioning market economy and for individual
workers to boost their wages. This paper provides a re-assessment of job mobility
in the United States during 2000-2018, based on a novel administrative data source
covering almost all workers and job flows. First, aggregate job hire and job separation
rates have declined over time, especially in the 2000s. This is mainly driven by flows
into and out of nonemployment, while job-to-job hires during 2016-2018 had recovered
to their peak levels prior to the global financial crisis. Examination of job mobility
across different individual and firm-level characteristics shows comparatively higher
job-to-job flows for youth, the less educated, non-whites and individuals working
in young firms. In addition, observed job movers in these groups experience the largest
earnings gain on average from job-to-job changes. Second, a spatial look at job mobility
shows net job-to-job flows towards Western and Southern States. The aggregate rate
of interstate job-to-job hires has been stable since 2000 and the observed job-to-job
movers on average get a substantial boost to earnings by moving farther away and switching
industries. Third, the paper briefly considers the influence of demographic changes
on job mobility, one important driver identified in previous work. While ageing may
explain around half of the downward trend in job hire and separation rates, other
factors matter too.
Published on December 18, 2020
In series:OECD Economics Department Working Papersview more titles