Title

The Decline of Short Duration Employment Spells

Author(s)

Michael J. Pries Michael Pries (University of Notre Dame)

Richard Rogerson Richard Rogerson (Princeton University)

Abstract

Using the Quarterly Workforce Indicators, 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 less than a quarter. Using a search and matching model that incorporates noisy signals about the quality of a worker-firm match, we show that improved candidate screening by firms can account for the decline in short-lived employment spells. Quantitative exercises show that this explanation can account for the observed changes in various labor market outcomes, whereas alternative potential explanations, such as increased hiring costs, cannot.

Creation Date

2019-06

Section URL ID

Paper Number

2019-21

URL

https://www.nber.org/system/files/working_papers/w26019/w26019.pdf

File Function

Jel

E24, J23

Keyword(s)

Employment, Labor

Suppress

false

Series

13