Changing consequences of job separation in the United States

Using the Panel Study of Income Dynamics, the author examines the consequences of job loss between the periods 1976-81 and 1986-91. He finds stability in the overall incidence of job separation, but a statistically significant increase in the incidence of involuntary job loss, relative to quits, for older workers. He also finds that the consequences of involuntary job loss worsened: the reemployment rate of workers who experienced involuntary job loss dropped from 67% in 1976-81 to 62% in 1986-91, and among those who found new jobs, the odds of receiving a large wage cut rose from 9% in 1976-81 to 17% in 1986-91.