Peter Diamond, Institute Professor and Professor of Economics, Emeritus
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The focus of this paper is on gross hires relative to the tightness of the labor market, the aggregate matching function. The paper considers various decompositions of aggregate hires to see how the hiring process differs across different groups of workers and different groups of firms, Decompositions include worker employment status in the previous month, along with age, gender and education. Another decomposition separates hiring between part-time and full-time jobs, which show different patterns in the current recovery. Shift-share analyses are done based on industry, firm size and occupation to show how much of the size of the residual of the aggregate hiring function can be explained by the composition of vacancies across these dimensions. The paper also includes some issues in the modeling of the labor market. The paper briefly notes that the hiring process appears to shift as a recovery starts, coinciding with shifts in the Beveridge curve.
Contact: Beata Shuster, E52-439A, 617 253-8883, BSHUSTER@MIT.EDU