Long-term earnings losses of high-seniority displaced workers
Louis Jacobson, Robert J. LaLonde, Daniel G. Sullivan
In this article, we examine the long-term consequences of displacement for workers who had accumulated substantial seniority with their former employers. Using newly developed data from the administrative records of the state of Pennsylvania, we study the earnings histories of a group of workers who left declining firms between 1980 and 1986 after working for those firms since at least 1974. By observing these workers' earnings for several years before and after their separations, as well as the earnings of workers whose employment relationships endured throughout our sample period, we are able to assess displaced workers' long-term earnings losses much better than has previously been possible.
