JEL: C21, J22, J23, J38, J65

Abstract

We estimate the magnitudes of reduced earnings, work hours, and wage rates of workers displaced during the Great Recession using linked employer-employee panel data from Washington State. Displaced workers’ earnings losses occurred mainly because hourly wage rates dropped at the time of displacement and recovered sluggishly. Lost employer-specific premiums explain only 17 percent of these losses. Fully 70 percent of displaced workers moved to employers paying the same or higher wage premiums than the displacing employers, but these workers nevertheless suffered substantial wage rate losses. Loss of valuable specific worker employer
matches explain more than half of the wage losses.

Year of Publication
2019
Number
631
Date Published
10/2019
Publication Language
eng
Citation Key
11446
Mas, A., Lachowska, M., & Woodbury, S. (2019). Sources of Displaced Workers’ Long-Term Earnings Losses. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01n870zt699 (Original work published 10/2019AD)
Working Papers