The Recent Decline in Employment Dynamics

Abstract

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The recent decline of single quarter jobs

“…4 Similar to the decline in the total hires and separations rates, the declining single quarter jobs rate shows a stair-step pattern where almost all of the declines are concentrated during the recessions of 2001 and 2007-2009. This is similar to declines in the broad range of employment dynamics measures documented by Hyatt and Spletzer (2013). The ratio of single quarter jobs to total hires also exhibits a stair-step pattern, falling from 38 percent in the late 1990s, to 35 percent in the mid 2000s, to 32 percent in the early 2010s.…”

The decline in job-to-job flows

“…This decline is related to a broader decline in employment dynamics around the same time: the rate of hires and separations declined, as did the rates at which jobs were created (through business entry and expansion) and destroyed (through business contraction and exit) [1]. Additionally, the decline in job-to-job flows may explain much of the decline in residential migration between states that occurred at roughly the same time [3].…”

“…One study that ran a series of tests on whether compositional changes in the workforce can explain the decline in the job-to-job flow rate finds that the aging of the US workforce may explain some of the decline in the aggregate job-to-job flow rate [1]. Since older workers tend to switch jobs less often than younger workers, the aging of the population explains 9% of the decline in the job-to-job flow rate using data from the Current Population Survey and 21% using data from the Longitudinal Employer−Household Dynamics data.…”

“…On net, there is a tiny offsetting positive effect (explains -1% of the decline) because there are fewer stable manufacturing jobs [1]. Negligible effects [1].…”

“…The study also includes an extended exploration of other reasons why employment dynamics may have declined in recent years [1]. Expanding globalization may have played a role, as the US relied increasingly on imports during the 1990s, and China and other middle-income countries accounted for a rising share of global manufacturing output.…”