The risk and cost of job loss in Canada, 1978–2008

Abstract We assess the risk and cost of worker displacement in Canada over the last three decades. We show that neither the risk of job loss nor the short‐term earnings losses of displaced workers trended upwards during that period. However, short‐term earnings losses of workers displaced from manufacturing increased in recent years, as a smaller proportion found a post‐displacement job in that sector. In line with Stevens and Couch and Placzek, we find that high‐seniority workers and individuals with stable labour market attachment experienced, five years after displacement, earnings losses that ranged between 10% and 18%.