Employer Concentration and Outside Options
(with Gregor Schubert and Bledi Taska)
Abstract: We study the effect of within-occupation employer concentration and outside-occupation job options on wages in the US, identifying outside-occupation options using new occupational mobility data from 16 million resumes. Using shift-share instruments to identify plausibly exogenous local variation, we find that moving from the median to 95th percentile of employer concentration reduces wages by 2.6% on average and by 7.3% for workers in the lowest quartile of outward occupational mobility. We also find meaningful effects of changes in the value of outside-occupation job options on wages. Our findings imply that policymakers should take employer concentration seriously, but that measures of employer concentration – typically calculated for single occupations – should be considered alongside occupational mobility and the availability of outside-occupation options.
Related things:
Occupational mobility data set (updated version 2021/01/05. Please email if questions - & let us know if you're using this data, we'd love to hear what it's useful for. NB: you will need to unzip using 7-Zip or equivalent.)
Policy brief on employer concentration with the Washington Center for Equitable Growth, article at ProMarket, research summary by UCLA Anderson Management Review
Older versions (WCEG working paper Jan 2021,old Tweet thread summary)