DP17071 Understanding the Reallocation of Displaced Workers to Firms
|Author(s):||Paul Brandily, Camille Hémet, Clément Malgouyres|
|Publication Date:||February 2022|
|Keyword(s):||Displaced Workers, Labor Share, productivity, reallocation, Wage|
|Programme Areas:||Labour Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=17071|
We study job displacement in France. In the medium run, losses in firmspecific wage premium account for a substantial share of the overall cost of displacement. However, and despite the positive correlation between premium and productivity in the cross-section of firms, we find that workers are reemployed by high productivity, low labor share firms. The observed reallocation is therefore productivity-enhancing, yet costly for workers. We show that destination firms are less likely to conclude collective wage agreements and have lower participation rates at professional elections. Overall, our results point to a loss in bargaining power.