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Author: Lins, Paulo
Resulting in 1 citation.
1. Bils, Mark J.
Kudlyak, Marianna
Lins, Paulo
The Quality-Adjusted Cyclical Price of Labor
Journal of Labor Economics 41,S1 (1 October 2023) S13-S59.
Cohort(s): NLSY79, NLSY97
Publisher: University of Chicago Press
Keyword(s): Job Separation/Loss; Labor Economics; Labor User Cost; Unemployment; Wage Levels; Wages; Wages, Starting

We estimate cyclicality in labor's user cost allowing for cyclical fluctuations in the quality of worker-firm matches and wages that are smoothed within employment matches. To do so, we exploit a match's long-run wage to control for its quality. Using 1980-2019 National Longitudinal Survey of Youth data, we identify three channels by which recessions affect user cost: they lower the new-hire wage and wages going forward in the match, but they also result in higher subsequent separations. We find that labor's user cost is highly procyclical, increasing by more than 4% for a 1 percentage point decline in unemployment.
Bibliography Citation
Bils, Mark J., Marianna Kudlyak and Paulo Lins. "The Quality-Adjusted Cyclical Price of Labor." Journal of Labor Economics 41,S1 (1 October 2023) S13-S59.