Working Paper

Uncovering the Differences among Displaced Workers: Evidence from Canadian Job Separation Records

Abstract: Using administrative data from Canada that is unique in providing information on the underlying reasons for and timing of job separations, we document that only 25 percent of mass-layoff separations, as identified through existing methods, are actual layoffs. We uncover significant differences in earnings and employer premium dynamics following layoffs and quits during mass layoffs. We also show that employers undergoing mass layoffs already experience substantial employment contractions prior to the mass layoffs, especially due to early quits. We find that employers lay off less productive workers first, but workers who quit before the mass layoff are not more productive.

Keywords: job displacement; earnings losses; layoffs; quits; employer effects;

JEL Classification: E24; E32; J31; J63; J65;

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Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Working Papers

Publication Date: 2023-09

Number: 2023-022

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