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This paper investigates the impact of labour mobility on plant performance in Denmark. Our study shows that the effect of labour mobility can only be assessed when one accounts for the type of skills that flow into the plant, and the degree to which these match the existing skills at the plant level. As expected, we found that the inflow of skills that are related to skills in the plant impacts positively on plant productivity growth, while inflows of skills that are similar to the plant skills have a negative effect. We used a sophisticated indicator of revealed relatedness that measures the degree of skill relatedness between sectors on the basis of the intensity of labour flows between sectors. Intra-regional mobility of skilled labour had a negative effect on plant performance, but the impacts of intra-and inter-regional mobility depended on the type of skills that flow into the plant.In this paper, we incorporate this idea of industry relatedness into labour mobility studies. Labour mobility is often regarded as a key mechanism through which knowledge diffuses across firms within regions (Angel, 1991;Almeida and Kogut, 1999;Pinch and Henry, 1999;Malmberg and Power, 2005;Iammarino and McCann, 2006;Rodriguez-Pose and Vilalta-Bufi, 2005). However, scholars have also pointed out that labour mobility may obstruct human capital formation at the regional level, because of labour poaching. Quantitative studies have indeed shown that intra-regional labour mobility is not per se a good thing (e.g. Eriksson, 2011). In that context, Boschma et al. (2009) have claimed that the effect of labour mobility on firm performance can only be assessed when one accounts for the types of skills that are transferred when people change jobs, and the degree to which these match the existing skills in the firm. They showed in a study on Sweden that the inflow of new skills should not be identical, but related to the existing skills in a plant (i.e. new employees recruited from related industries) to impact positively on plant performance.The main objective of the paper is to test these ideas empirically in the case of Denmark. We employ the so-called IDA-database that provides detailed information on individuals and plants for the whole Danish economy, and we will analyse close to 52,000 high-skilled job moves into almost 17,000 Danish plants in the period 1999-2003. We hypothesize that new employees that bring in work experience from the same industry will not really contribute to plant performance, because these do not add something new to the existing skills in the plant. The same applies to the inflow of new skills that are unrelated to the skills of the plant. In that case, the plant cannot easily absorb these, and we expect the plant is unlikely to learn and benefit from it. By contrast, we expect that new employees recruited from industries related to the activity of the plant to have a positive effect on plant performance, because they offer real learning opportunities. Contrary to previous studies, we make use of an advanced r...

The challenge for solo entrepreneurs to add their first employee is arguably the single biggest growth event facing any growing firm. To understand how this event affects performance, and the antecedents of hiring, we analyse Danish matched employer-employee data. Those who hire enjoy superior sales outcomes in subsequent years, while the dispersion in profits increases. Furthermore, those that hire enjoy faster sales growth in the previous year, suggesting that sales growth precedes the first hire.Finally, we show that founders with a stronger profile in terms of education and previous income are more likely to increase profits, while the characteristics of the employee are less important. The latter finding is important from a job creation perspective, in light of the suggested sorting of more marginalized employees into new and established firms.