Working Paper: NBER ID: w24538
Authors: Congshan Zhang; John M. De Figueredo
Abstract: Utilizing a large dataset on U.S. federal government employees covering 24 years, we estimate and analyze the persistent wage effect of entering government employment during recessions for recent college graduates and other new employees. Contrary to previous results in the literature for private sector employees, we document a significant and long-term wage increase for federal civil servants who enter government service in recessions. We show this result is robust to alternative samples and model specifications. We conclude by examining agency occupation composition and job matching as mechanisms for these results.
Keywords: recession; wages; government
JEL Codes: H11; H83; J28; J31; J45; K0
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| changes in agency occupation composition (J21) | wage advantage (J31) |
| job matching (C78) | wage advantage (J31) |
| unemployment rate (J64) | wage increase (J31) |
| Entering government employment during recessions (J68) | long-term wage increase (J31) |
| Entering government employment during recessions (J68) | wage advantage (J31) |
| initial unemployment rate (J64) | first shock's effect (E32) |