Does working at a start-up pay off?

Arbeitspapier

Using representative linked employer-employee data for Germany, this paper analyzes short- and long-run differences in labor market performance of workers joining start-ups instead of incumbent firms. Applying entropy balancing and following individuals over ten years, we find huge and long-lasting drawbacks from entering a start-up in terms of wages, yearly income, and (un)employment. These disadvantages hold for all groups of workers and types of start-ups analyzed. Although our analysis of different subsequent career paths highlights important heterogeneities, it does not reveal any strategy through which workers joining start-ups can catch up with the income of similar workers entering incumbent firms.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Diskussionspapiere ; No. 112

Classification and Topics

• Classification: Wirtschaft ; Wage Level and Structure; Wage Differentials ; Labor Turnover; Vacancies; Layoffs ; Entrepreneurship ; Personnel Economics: Firm Employment Decisions; Promotions
• Subject: startups ; young firms ; wages ; linked employer-employee data

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Fackler, Daniel ; Hölscher, Lisa ; Schnabel, Claus ; Weyh, Antje
• Event: Veröffentlichung
• (who): Friedrich-Alexander-Universität Erlangen-Nürnberg, Lehrstuhl für Arbeitsmarkt- und Regionalpolitik
• (where): Nürnberg
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/215426
• Last update: 10.03.2025, 11:45 AM CET