Skill shortages and firms' employment behaviour
2007
14
2
April
231-249
labour demand ; labour shortage ; manufacturing industry ; skilled worker ; statistics
Labour market
English
Bibliogr.
"This study investigates the effects of skill shortages on the dynamics of employment at the firm level for UK manufacturing between 1984–94. We find that shortages of skilled labour have a statistically significant effect on firms' employment behaviour. It has a positive effect on firms' adjustment costs leading to employment being more sluggish to respond when the labour market is tight, implying that employment adjustment will be more responsive in the downward direction. This result is robust to the inclusion of a measure of firms' sales expectations, with the effect of skill shortages being greater in periods when firms expect sales to rise."
Paper
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