What matters for job search and long-term separation? Evidence of labor market dynamics in New Zealand

What matters for job search and long-term separation? Evidence of labor market dynamics in New Zealand

Author/Editor:

Guanyu Zheng; Gulnara Nolan; Christophe Boulé; Siddharth Kothari; Yosuke Kidō



Publication date:

September 7, 2022

Electronic access:

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Disclaimer: IMF Working Papers describe ongoing research by the author(s) and are published to elicit comment and encourage debate. The opinions expressed in IMF Working Papers are those of the authors and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.


Summary:

We use new anonymized microdata from the Household Labor Force Survey (HLFS) to analyze job search rates and job separation rates in New Zealand. We find that individual characteristics, including age, gender, ethnicity, and education, have a significant impact on job search and job separation rates, even after controlling for other factors. We use a decomposition approach to analyze how the effects of individual characteristics on job search and job separation rates contribute to the heterogeneity of employment outcomes. Overall, we find that higher separation rates for younger workers play a disproportionate role in explaining heterogeneity in employment outcomes across age groups, while differences in find rates are somewhat more important in explaining differences by level of education. Differences in outcomes and separation rates are important in explaining ethnic differences. We also find a heterogeneous response of worker groups to the business cycle after controlling for other factors. The results highlight the importance of well-targeted labor market support policies.

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