%0 Report
        %A Arellano-Bover, Jaime
        %T Career Consequences of Firm Heterogeneity for Young Workers: First Job and Firm Size
        %D 2020
        %8 2020 Feb
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 12969
        %U https://www.iza.org/index.php/publications/dp12969
        %X I study the long-term effects of landing a first job at a large firm versus a small one using Spanish social security data. Size could be a relevant employer attribute for inexperienced workers since large firms are associated with greater training, higher wages, and enhanced productivity. The key empirical challenge is selection into first jobs – for instance, more able people may land jobs at large firms. I address this challenge developing an instrumental-variables approach that, while keeping business-cycle conditions fixed, leverages variation in the composition of labor demand that labor-market entrants face. 
I find that initially matching with a larger firm substantially improves long-term outcomes such as lifetime income, and that these benefits persist through subsequent jobs. Additional results point to mechanisms related to search frictions and better skill-development at large firms. Together, these findings shed light on how heterogeneous firms persistently impact young workers' trajectories.
        %K first job
%K employer size
%K firm heterogeneity
%K young workers
%K on-the-job skills
%K lifetime income