Job Mobility and Wage Dynamics

Matched employer-employee data research has found that workersf wages are affected by the characteristics of the firms they work in, and that higher skilled workers tend to be employed by higher paying firms. This paper examines the contribution of workersf job mobility to their wage dynamics. We focus on the possible trade-off between moving to a better paying firm and losing a firm-tenure specific component of earnings, and examine what types of workers benefit from changing firms, rather than staying with their existing employer. Our analysis provides four main findings. First, although the raw earnings gains to jobmovers and stayers are about the same, we find that, after controlling for observable differences, job-movers have about 1.3 percent lower annual earnings growth than nonmovers. Second, we estimate that job-movers gain 0.3 percent per year on average from moving to higher paying firms, but lose 1.6 percent in transitory earnings associated with changing jobs. The gains from moving to better firms are larger for both younger and new entrant workers, while the transitory earnings losses are smaller. We interpret these findings as being due to an earnings growth trade-off for workers between moving to a higher paying firm and losing their tenure-related earnings at their existing firm. Third, we estimate that, on average, workers gain (almost) all of the change in firm earnings premiums when they change jobs. However, such gains are not equally shared by all workers. In particular, our estimates suggest that it is the higher ability workers (as measured by the estimated worker earnings premiums) whose earnings gain (or lose) the most from moving to a firm with higher (or lower) earnings premiums. Finally, we find that workersf earnings also benefit on average from a change in the average earnings of their co-workers. Controlling for other factors, we estimate that a 1 standard deviation change in the estimated average peer earnings is associated with about 0.25 percent change in a workerfs earnings on average.Earnings, Linked Employer-Employee Data, worker mobility, job turnover

Cities and Skills

This paper examines the productivity (and wage) gains from locating in dense, urban environments. We distinguish between three potential explanations of why firms are willing to pay urban workers more: (1) the urban wage premium is spurious and is the result of omitted ability measures, (2) the urban wage premium works because cities enhance productivity and (3) the urban wage premium is the result of faster skill accumulation in cities. Using a combination of standard regressions, individual fixed effects estimation (using migrants) and instrumental variables methods, we find that the urban wage premium does not represent omitted ability bias and it is only in part a level effect to productivity. The bulk of the urban wage premium accrues over time as a result of greater skill accumulation in cities.

Deprivation in New Zealand: Regional Patterns and Changes

This paper presents an analysis of the distribution of socio- economic deprivation throughout New Zealand. The analysis focuses on the three census years 1986, 1991, and 1996. A summary deprivation measure is constructed which approximates New ZealandDep96 using standard regression techniques. The paper extends a static analysis of deprivation by examining changes to the deprivation profile across time on a regional basis. Differences in the incidence of deprivation for different ethnic groups are emphasised. Maori and Pacific people are more likely to live in deprived meshblocks than their European counterparts. We also touch on the role isolation plays in determining the distribution of deprivation.deprivation; inequality; distribution; meshblocks; regions

Geographic Concentration of New Zealand Employment

This paper examines the degree of geographic concentration of employment in New Zealand, using summary measures proposed by Ellison and Glaeser (1997) and Maurel and Sedillot ( 1999). We use Statistics New Zealand Business Demography data for the period 1987-2003, and find that concentration has risen during that period. Around half of employment is in industries that display no significant concentration. International comparisons of the degree of concentration are difficult. but it appears that New Zealand's levels are similar to those of the United Kingdom, and lower than those of the US and France. Where concentration does occur, it operates most strongly over distances of less than 50km

What Workd For Whom?: The Effectiveness of Different Employment Programmes

This paper estimates the impact of different categories of employment policy interventions on job-seekers' subsequent experience. We generate a range of estimates to help us distinguish programme effects from selection effects. We also examine the robustness of our findings for a range of sub-populations. There is limited variation in programme effects for people with different observed characteristics. Some evidence suggests that programme effectiveness may be countercyclical

Modelling Regional Labour Market Adjustment in New Zealand

This paper adopts a vector autoregressive (VAR) approach to analyse the labour market adjustment mechanisms for 12 New Zealand regions over the period 1985 to 2001. It examines the effects of a region-specific shock to employment on itself, the unemployment rate, the participation rate, and the wage rate. The role of migration as a channel of regional labour market adjustment is also inferred. We find that adjustment occurs predominantly through inter-regional migration although the unemployment and participation rates also play a role. Wages, on the other hand, account for very little adjustment. The importance of inter-regional migration in New Zealand matches the results found in Sweden, but stands in contrast to the picture in many European countries. Migration appears to be a more dominant adjustment channel compared to the US and Australian cases. However, this has to be placed into context – New Zealand regions are much smaller in terms of population size.Regional labour market adjustment; Internal migration