Inter-industry labor flows

Arbeitspapier

Labor flows across industries reallocate resources and diffuse knowledge among economic activities. However, surprisingly little is known about the structure of such inter-industry flows. How freely do workers switch jobs among industries? Between which pairs of industries do we observe such switches? Do different types of workers have different transition matrices? Do these matrices change over time? Using German social security data, we generate stylized facts about inter-industry labor mobility and explore its consequences. We find that workers switch industries along tight paths that link industries in a sparse network. This labor-flow network is relatively stable over time, similar for workers in different occupations and wage categories and independent of whether workers move locally or over larger distances. When using these networks to construct inter-industry relatedness measures they prove better predictors of local industry growth rates than co-location or input-based alternatives. However, because industries that exchange much labor typically do not have correlated growth paths, the sparseness of the labor-flow network does not necessarily prevent a smooth reallocation of workers from shrinking to growing industries. To facilitate future research, the inter-industry relatedness matrices we develop are made available as an online appendix to this paper.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IAB-Discussion Paper ; No. 21/2016

Classification and Topics

• Classification: Wirtschaft ; Human Capital; Skills; Occupational Choice; Labor Productivity ; Job, Occupational, and Intergenerational Mobility; Promotion ; Size and Spatial Distributions of Regional Economic Activity ; Transactional Relationships; Contracts and Reputation; Networks ; Technological Change: Choices and Consequences; Diffusion Processes
• Subject: labor mobility ; relatedness ; skills ; regional growth ; Germany ; human capital specificity

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Neffke, Frank ; Otto, Anne ; Weyh, Antje
• Event: Veröffentlichung
• (who): Institut für Arbeitsmarkt- und Berufsforschung (IAB)
• (where): Nürnberg
• (when): 2016

Further information

• Handle: http://hdl.handle.net/10419/146161
• Last update: 10.03.2025, 11:45 AM CET