Research

“High-Skilled Labor Cyclicality and the Role of Pay Type” (Job Market Paper)

Working Paper

The cyclical volatility of hours per worker is lower among college graduates than those without a college degree. I show empirically that accounting for pay type reduces this volatility gap by 44%. Non-college graduates are more than twice as likely to be paid by the hour, and hourly workers have more cyclically volatile hours per worker than salaried workers. The cyclical volatility of employment, by contrast, is higher for salaried workers. Using a model with search and matching in which a matched worker and firm bargain over the intensive hours margin, I show how pay type itself can lead to hours per worker being more volatile among hourly workers. Pay stickiness hinders worker and firm from adjusting hours in response to productivity changes, and a sticky salary is a larger impediment than a sticky wage.

"Correlation in Spouses’ Employment Status and the Value of a Second Earner"

Working paper

Among dual-earner couples, one spouse becoming unemployed implies a higher probability of the other spouse becoming unemployed that month. Similarly, unemployed couples tend to find jobs in the same month. In this paper, I document that the correlations in spouses’ employment transitions are not only positive but increasing over the last 45 years. The increasing share of same-occupation couples explains some but not all of this trend. I then use a quantitative model of household labor supply with labor frictions to measure the impact of this trend on households’ wellbeing and labor supply. As spouses’ employment transitions become more correlated, their unemployment spells become more overlapping, reducing the marginal benefit of a second earner. As a result, married women’s labor force participation falls by 0.6%.