Working Paper: NBER ID: w23731
Authors: R Jason Faberman; Andreas I Mueller; Ayegl Ahin; Giorgio Topa
Abstract: We develop a unique survey that focuses on the job search behavior of individuals regardless of their labor force status and field it annually starting in 2013. We use our survey to study the relationship between search effort and outcomes for the employed and non-employed. Three important facts stand out: (1) on-the-job search is pervasive, and is more intense at the lower rungs of the job ladder; (2) the employed are about four times more efficient than the unemployed in job search; and (3) the employed receive better job offers than the unemployed. We set up an on-the-job search model with endogenous search effort, calibrate it to fit our new facts, and find that the search effort of the employed is highly elastic. We show that search effort substantially amplifies labor market responses to job separation and matching efficiency shocks over the business cycle.
Keywords: Job Search; Labor Market; Employment; Unemployment
JEL Codes: E24; J29; J60
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| employment status (J63) | search behavior (D83) |
| employment status (J63) | search efficiency (G14) |
| employment status (J63) | job offers (M51) |
| search effort (C90) | macroeconomic outcomes (E66) |
| job separation and matching efficiency shocks (J65) | search intensity (D83) |
| observable worker characteristics (J29) | confounding factors (D91) |
| unobserved productivity differences (O49) | wage offer differentials (J31) |