NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Michael Pries

Department of Economics
3034 Jenkins and Nanovic Halls
University of Notre Dame
Notre Dame, IN 46556

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Institutional Affiliation: University of Notre Dame

NBER Working Papers and Publications

June 2019Declining Worker Turnover: the Role of Short Duration Employment Spells
with Richard Rogerson: w26019
Using the Quarterly Workforce Indicators, we document that a significant amount of the decline in labor market turnover during the last two decades is accounted for by the decline in employment spells that last less than a quarter. Using a search and matching model that incorporates noisy signals about the quality of a worker-firm match, we show that improved candidate screening by firms can account for the decline in short-lived employment spells. Quantitative exercises show that this explanation can account for the observed changes in various labor market outcomes, whereas alternative potential explanations, such as increased hiring costs, cannot.
 
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