Seven facts about temporary layoffs

A Nekoei, A Weber - 2020 - papers.ssrn.com
2020papers.ssrn.com
We establish seven facts about temporary layoffs (TL), whose employers communicated an
anticipated recall date at layoff:(1) The higher the current TL share at firm/industry-level, the
higher (lower) the future recall (layoff) likelihood for both temporary and permanent layoffs
(employees);(2) TL is more prevalent in: the upper-middle part of the wage distribution,(3-4)
in mass layoffs and recessions;(5) The later the communicated recall date, the lower the
accepted new-job wage, unconditional and conditional on non-employment duration;(6) TLs' …
Abstract
We establish seven facts about temporary layoffs (TL), whose employers communicated an anticipated recall date at layoff:(1) The higher the current TL share at firm/industry-level, the higher (lower) the future recall (layoff) likelihood for both temporary and permanent layoffs (employees);(2) TL is more prevalent in: the upper-middle part of the wage distribution,(3-4) in mass layoffs and recessions;(5) The later the communicated recall date, the lower the accepted new-job wage, unconditional and conditional on non-employment duration;(6) TLs' new-job hazard rate (wage) jumps (drops) when recall likelihood falls;(7) Extending unemployment benefits increases separations in recall-intense sectors.
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