What Matters for Job Finding and Separation in the Long Run? Evidence from Labor Market Dynamics in New Zealand

IMF Working Papers, September 7, 2022

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Canonical URL: What Matters for Job Finding and Separation in the Long Run? Evidence from Labor Market Dynamics in New Zealand

Authors: Guanyu Zheng, Gulnara Nolan, Christopher Ball, Siddharth Kothari, Yosuke Kido
Published: September 7, 2022
Series: IMF Working Papers
DOI: https://doi.org/10.5089/9798400218910.001

Uses the novel anonymized Household Labour Force Survey (HLFS) microdata to analyze job finding rates and job separation rates in New Zealand.
Investigates how individual characteristics and business-cycle movements shape heterogeneity in employment outcomes.

Individual characteristics—age, gender, ethnicity, and education—have a significant impact on job finding and separation rates, even after controlling for other factors.
Higher separation rates of young workers play a disproportionate role in explaining heterogeneity of employment outcomes across age groups.
Differences in finding rates are somewhat more important in explaining differences by education level.
Both finding-rate and separation-rate differences are important in explaining differences across ethnicities.
There is some heterogeneous response of worker groups to the business cycle after controlling for other factors.
Results underscore the importance of well-targeted labor market support policies.

Empirical analysis based on HLFS microdata.
Uses a decomposition approach to attribute how effects of individual characteristics on job finding and separation rates contribute to heterogeneity in employment outcomes.

Emphasizes the need for well-targeted labor market support policies that account for:
- Elevated separation risks faced by young workers.
- Education-related differences in job finding rates.
- Ethnicity-specific differences in both finding and separation rates.
- Differential sensitivity of worker groups to business-cycle fluctuations.