Understanding the Reallocation of Displaced Workers to Firms

Paul Brandily (1, 2) , Camille Hémet (1, 2) , Clément Malgouyres (1, 2, 3)

1 PSE - Paris School of Economics
2 PJSE - Paris Jourdan Sciences Economiques
3 IPP - Institut des politiques publiques

We study job displacement in France. In the medium run, losses in firm-specific wage premium account for a substantial share of tthe 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.

Mots clés: Displaced workers; Wage; Reallocation; Labor share; Productivity; Labor share Displaced workers

Domaines: Economies et finances

Paul Brandily, Camille Hémet, Clément Malgouyres. Understanding the Reallocation of Displaced Workers to Firms. 2022. ⟨halshs-03082302v2⟩