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Title: Job Change of Young Men
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Antel, John J. |
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Job Change of Young Men Ph.D. Dissertation, University of California - Los Angeles, 1983. DAI-A 44/05, p. 1530, November 1983 Cohort(s): Young Men Publisher: UMI - University Microfilms, Bell and Howell Information and Learning Keyword(s): Behavior; Firm Size; Job Productivity; Job Search; Job Turnover; Layoffs; Mobility; Quits; Simultaneity; Wage Levels; Wages This paper examines the job changing behavior of young men in the time period immediately following graduation or completion of formal schooling. The paper comprises a theoretical model of quits and permanent layoffs along with empirical results using a sample of recent labor market starters derived from the national Longitudinal Survey of Young Men. The discussion commences with a theoretical model of job matching. The model assumes that workers are endowed with firm-specific skills which vary in value with firm assignment and are imprecisely known to either worker or firm prior to some trial period on the job. These assumptions imply that workers must search, often while employed, to find their highest paying job. Further, since workers differ in their comparative advantage or job-specific abilities, firms must screen prospective employees prior to hire and then monitor worker productivity during the intial period of employment. Quits and layoffs follow as outcomes of these two simultaneous firms and worker learning processes; workers quit when they find a more lucrative job, and firms initiate layoffs when worker productivity is found far below initial expectations. In contrast to other models of job matching, transactions or negotiation costs influence quit and layoff decisions in our model. Mobility in the presence of transactions cost is distinguished from the zero transactions cost situation in two important respects. First, transactions costs imply that quits and layoffs are different. Much of the empirical work that follows is an attempt to document this difference. Second, with transactions costs, the welfare implications of job change are not, in general, positive as suggested by the zero transactions cost model of mobility. Transactions costs imply that mobility decisions are made on the basis of each decision makers rent share rather than for the purpose of maximizing total job-match productivity. Thus, some quits and layoffs may imply an actual decline in productivity. The empirical implications of the job-matching model with negotiations costs were for the most part consistent with the data. Quits and layoffs were found to be different both in terms of how they are predicted by wages, and also distinguished with respect to how wages are affected by mobility. The results indicated that while quits are negatively related to the wage level, layoffs were not predicted at all by wages. Further, although we found only weak positive effects of quitting on wage growth, layoffs generally implied a significant deline in wages. Neither of these patterns of contrast between quits and layoffs could be accounted for by costless negotiation or zero transactions cost models of job-matching. Although results on the determination of quits and the wage growth experience of non-repeat job changers suggested a central role for wages in the explanation of turnover, other factors affected mobility decisions also. Firm size, demand shocks, union membership, and non-pecuniary aspects of job value all played some role in the explanation of job change. |
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Bibliography Citation
Antel, John J. Job Change of Young Men. Ph.D. Dissertation, University of California - Los Angeles, 1983. DAI-A 44/05, p. 1530, November 1983. |