How will Labor Markets Adjust to the Crisis? A Dynamic View

How will Labor Markets Adjust to the Crisis? A Dynamic View

Tracking flows of workers among different sectors of employment during economic downturns can shed light on the mechanism of labor market adjustment and inform the design of safety net programs. Though patterns may differ across recessions, the aut...

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Bibliographic Details
Main Author: Maloney, William
Format: Brief
Language:English
Published: World Bank, Washington, DC 2012
Subjects:
ABSORPTION OF LABOR
BUSINESS CYCLE
CRISES
DISGUISED UNEMPLOYMENT
DRIVERS
ECONOMIC DOWNTURNS
ECONOMIC SHOCK
ECONOMIC SHOCKS
ECONOMICS
EMPLOYERS
EMPLOYMENT
EMPLOYMENT STATUS
FIRING
HIRING
INCOME
INFORMAL EMPLOYMENT
INFORMAL SECTOR
JOB LOSS
JOB MATCHES
JOB SEEKERS
JOB SEPARATION
JOBS
LABOR COST
LABOR FORCE
LABOR MARKET
LABOR MARKET ADJUSTMENT
LABOR MARKET INDICATOR
LABOR MARKETS
MACRO ECONOMIC FLUCTUATIONS
RETIREMENT
SAFETY
SAFETY NET
SAFETY NETS
SELF EMPLOYED
SELF EMPLOYMENT
SMALL BUSINESS
SOCIAL PROTECTION
UNEMPLOYED
UNEMPLOYED WORKERS
UNEMPLOYMENT
UNEMPLOYMENT RATE
WAGES
WORKERS
YOUTH
Online Access:http://documents.worldbank.org/curated/en/2009/03/11954044/labor-markets-adjust-crisis-dynamic-view
http://hdl.handle.net/10986/10995
Description
Summary:Tracking flows of workers among different sectors of employment during economic downturns can shed light on the mechanism of labor market adjustment and inform the design of safety net programs. Though patterns may differ across recessions, the author find that the generally countercyclical rise in unemployment and informality is driven primarily by a reduction in hiring in the formal sector, rather than increased labor shedding. Further, changes in the rate of separations from informality are the largest determinant of changes in unemployment. Both suggest that safety nets should focus less on formal job loss per se and more generally on movements in family incomes, perhaps revealed through self targeting mechanisms.

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