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Unequal worker exposure to establishment deaths

Author

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  • Macartney, Hugh
  • Nielsen, Eric
  • Rodriguez, Viviana
Abstract
It is well understood that adverse economic shocks affect workers nonuniformly. We explore a new channel through which unequal employment outcomes may emerge during a downturn: displacement through the extensive margin of establishment deaths. Intuitively, workers who are concentrated in less resilient establishments prior to an economic decline will be disproportionately affected by its onset. Using rich administrative employment and establishment data for the United States, we show that Black workers bore the brunt of the Great Recession in terms of within-industry employment changes arising from establishment deaths. This finding has important implications for the evolution of worker disparities during future downturns.

Suggested Citation

  • Macartney, Hugh & Nielsen, Eric & Rodriguez, Viviana, 2021. "Unequal worker exposure to establishment deaths," Labour Economics, Elsevier, vol. 73(C).
    • Handle: RePEc:eee:labeco:v:73:y:2021:i:c:s0927537121001081
    DOI: 10.1016/j.labeco.2021.102073
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    Cited by:

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    2. Ernst Coupet & Ehab Yamani, 2022. "The impact of the coronavirus on African American unemployment: lessons from history," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 56(1), pages 1-18, December.

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    More about this item

    Keywords

    Economic shocks; Worker inequality; Establishment deaths; Employment; Firm resilience; Industry composition; Gap; Disparity; Decomposition;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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