Job Loss and the Decline in Job Security in the United States


Job tenure and the incidence of long-term employment have declined sharply in the United
States However, rates of job loss as measured by the Displaced Workers Survey (DWS), while
cyclical, have not shown a trend increase that would account for the decline in job tenure
and long-term employment. This presents a puzzle that has several potential solutions. One
is that, while overall rates of job loss have not increased, rates of job loss for high-tenure
workers have increased relative to those for lower-tenure workers. Another is that there has
been an increase in rates of job change that is not captured in the limited questions asked
in the DWS. Some of this seemingly voluntary job change (e.g., the taking of an o ered
buy-out) may re
ect the kind of worker displacement that the DWS was meant to capture
but is not reported as such by workers.
In this study, I address these issues by 1) documenting the decline in job tenure and long-
term employment using data from various supplements to the Current Population Survey
(CPS) from 1973-2008, 2) documenting the lack of secular change in rates of job loss using
data from the DWS from 1984-2008, and 3) exploring the extent to which the observed
patterns result from a relative increase in rates of job loss among high-tenure workers. I
nd that the decline in job tenure and long-term employment is restricted to the private
sector and that there has been some increase in job tenure and long-term employment in
the public sector. I nd no secular changes in relative rates of job loss in either sector that
could account for these trends. Reconciliation of the trends in the tenure and displacement
data must lie with a failure to identify all relevant displacement in the DWS.

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