Essays in labor economics

The first chapter of this dissertation examines temporary workers (temps), their choices, and the growth in temporary employment. I develop a multinomial logit choice model to analyze why people choose temporary jobs. I find that some people choose a temporary job because they desire greater schedule flexibility, particularly students. For most, however, weaker permanent job opportunities drive them into temporary positions. Using the 1995 and 1997 Current Population Surveys (CPS) I find that both the percentage of the work force in temporary jobs and the absolute number of temps declined when applying a new CPS-based measure of temporary. This is in stark contrast to the rising percentage found in several previous studies when looking only at workers in personnel supply services and clearly questions prior claims and concerns about growth in the temporary work force. The decline in temporary employment may have been triggered by a decline in job loss. In the second chapter I construct a time series for studying job loss. I am particularly interested in employment-to-unemployment (EU) transitions caused by job loss. The results show that the dynamics of the EU job loss rate and unemployment rate have been very similar during the 1968–2000 period, i.e. both rates had been increasing until the early 1980s and have been declining since. A remarkable and new finding is that the rate of job loss in 2000 is not much different from the one in the end of the 1960s. Another perspective of studying EU job loss involves its application to the Mortensen-Pissarides (MP) labor market matching model. Job creation and job destruction data have traditionally been used to study labor market dynamics in the MP model. I argue that the data on worker flows also provide useful information, which may help with the empirical implementation of the MP model and its use in answering policy questions.