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Federal Reserve Bank of San Francisco
Working Paper Series
Which industries are shifting the Beveridge curve?
Regis Barnichon
Michael Elsby
Bart Hobijn
Aysegül Sahin
Abstract

The negative relationship between the unemployment rate and the job openings rate, known as the Beveridge curve, has been relatively stable in the U.S. over the last decade. Since the summer of 2009, however, the U.S. unemployment rate has hovered between 9.4 and 10.1 percent in spite of firms reporting more job openings. We decompose the recent deviation from the Beveridge curve into different parts using data from the Job Openings and Labor Turnover Survey (JOLTS). We find that most of the current deviation from the Beveridge curve can be attributed to a shortfall in the vacancy yield, which measures hires per vacancy. This shortfall is broad-based across all industries and is particularly pronounced in construction, transportation, trade, and utilities, and leisure and hospitality. Construction alone accounts for more than a third of the Beveridge curve gap.


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Regis Barnichon & Michael Elsby & Bart Hobijn & Aysegül Sahin, Which industries are shifting the Beveridge curve?, Federal Reserve Bank of San Francisco, Working Paper Series 2010-32, 2010.
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Keywords: Unemployment ; Employment (Economic theory) ; Labor market
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