The Effect of Occupation on Employment Outcomes for Displaced Workers

Undergraduate Honors Thesis

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Citeable URL: https://scholar.colorado.edu/concern/undergraduate_honors_theses/6108vb81z

Abstract

This study analyzes the effect of past occupation on employment outcomes for displaced workers. The data used is a pooled cross sectional sample of displaced workers from 1996 to 2016, and employment outcomes are measured in three ways: the length of an individual’s unemployment spell, the change in weekly earnings between their lost and current job, and the total lost income caused by displacement over a five-year period. Considerable differences are found among occupations for all three outcome measures. To investigate the causes of this heterogeneity, I analyze the impact of human capital and aggregate occupation demand on occupation effects. Variation in the value of human capital in recovering from job loss can explain much of the occupational differences in weekly income change and five-year lost income. Differences in aggregate occupation demand, conversely, are found to mainly explain occupational heterogeneity in unemployment length.

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