May 2019

IZA DP No. 12333: Birds, Birds, Birds: Co-Worker Similarity, Workplace Diversity, and Voluntary Turnover

revised version published as 'Birds, Birds, Birds: Co-Worker Similarity, Workplace Diversity and Job Switches' in: British Journal of Industrial Relations, 2020, 58 (3), 690-718

We investigate how the demographic composition of the workforce along the sex, nationality, education, age, and tenure dimension affects voluntary turnover. Fitting duration models for workers' job-to-job moves that control for workplace fixed effects in a representative sample of large manufacturing plants in Germany during 1975–2016, we find that larger co-worker similarity in all five dimensions substantially depresses voluntary turnover whereas workplace diversity is of limited importance. In line with conventional wisdom, which has that birds of one feather flock together, our results suggest that workers prefer having co-workers of their kind and place less value on diverse workplaces.