%0 Report
        %A Jung, Philip
%A Kuhn, Moritz
        %T Earnings Losses and Labor Mobility over the Lifecycle
        %D 2012
        %8 2012 Sep
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 6835
        %U https://www.iza.org/publications/dp6835
        %X Extensive literature demonstrates that workers with high tenure suffer large and persistent earnings losses when they are displaced. We study the reasons behind these losses in a tractable search model that includes a lifecycle dimension, endogenous job mobility, and worker- and match-heterogeneity. The model jointly explains key characteristics of the U.S. labor market such as large average transition rates, a large share of stable jobs, and earnings losses after displacement. We decompose earnings losses and find that only 50% result from wage loss, and endogenous reactions and selection account for the remainder. These findings have important implications for welfare costs of displacement and labor market policies.
        %K labor-market transitions
%K lifecycle
%K earnings losses
%K turbulence