Firm-Level Hiring Difficulties: Persistence, Business Cycle and Local Labour Market Influences

46 Pages Posted: 23 Aug 2013

See all articles by Richard Fabling

Richard Fabling

New Zealand Productivity Commission

David C. Maré

Motu Economic and Public Policy Research Trust; University of Waikato - Economics

Abstract

We examine the correlates of reported hiring difficulties at the firm level using linked employer-employee and panel survey data over 2005-2011, focussing on the relative influence of firm-level characteristics, persistence, the business cycle and local labour market liquidity. At both the aggregate and the firm-level, hiring difficulties eased after the onset of the Global Financial Crisis. Even in the presence of large cyclical changes in demand and labour market conditions, firm-level persistence is a dominant feature of the data, with one- and two-year lags of reported hiring difficulties both positively related to current difficulties. Firms paying higher wages are more likely to report difficulties when trying to hire skilled workers, while firms with more long tenure workers are less likely to report any difficulty hiring. Local labour market conditions appear unrelated to reported hiring difficulties.

Keywords: hiring difficulties, hard-to-fill vacancies, local labour market, Global Financial Crisis

JEL Classification: E24, J23, J63, M51

Suggested Citation

Fabling, Richard and Maré, David C., Firm-Level Hiring Difficulties: Persistence, Business Cycle and Local Labour Market Influences. IZA Discussion Paper No. 7534, Available at SSRN: https://ssrn.com/abstract=2314829 or http://dx.doi.org/10.2139/ssrn.2314829

Richard Fabling (Contact Author)

New Zealand Productivity Commission ( email )

New Zealand

David C. Maré

Motu Economic and Public Policy Research Trust ( email )

PO Box 24390
Wellington, 6021
New Zealand
64-4-9394250 (Phone)

HOME PAGE: http://www.motu.org.nz

University of Waikato - Economics

New Zealand

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