Recall and unemployment

We document in the Survey of Income and Program Participation covering the period 1990–2013 that a surprisingly large share of workers return to their previous employer after a jobless spell, and experience very different unemployment and employment outcomes than job switchers. The probability of re...

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Bibliographic Details
Published in:The American economic review 2017-12, Vol.107 (12), p.3875-3916
Main Authors: Fujita, Shigeru, Moscarini, Giuseppe
Format: Article
Language:English
Subjects:
Arbeitslosigkeit
Arbeitsmarktpolitik
Arbeitsuche
Betriebszugehörigkeit
Economic models
Employment
Integration
Job hunting
Labor market
Productivity
Unemployment
USA
Wirtschaftliche Integration
Workers
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Summary:We document in the Survey of Income and Program Participation covering the period 1990–2013 that a surprisingly large share of workers return to their previous employer after a jobless spell, and experience very different unemployment and employment outcomes than job switchers. The probability of recall is much less procyclical and volatile than the probability of finding a new employer. We add to a quantitative, and otherwise canonical, search-and-matching model of the labor market a recall option, which can be activated freely following aggregate and job-specific productivity shocks. Recall and search effort significantly amplify the cyclical volatility of new job-finding and separation probabilities.
ISSN:0002-8282
1944-7981
DOI:10.1257/aer.20131496