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Labour Mobility and Earnings in the Uk, 1992–2017

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  • Fabien Postel-Vinay
  • Alireza Sepahsalari

Abstract

We combine information from the British Household Panel Study and the United Kingdom Household Longitudinal Study (also known as Understanding Society) to construct consistent time series of aggregate worker stocks, worker flows and earnings in the United Kingdom over the period 1992–2017. We propose a method to harmonise data between the British Household Panel Study and United Kingdom Household Longitudinal Study, which we validate by checking the consistency of some of our headline time series with equivalent series produced from other sources, notably by the Office for National Statistics. In addition to drawing a detailed aggregate picture of the United Kingdom labour market over the past two and a half decades, we use our constructed data set to compare the impact of industry, occupation and employer tenure on wages in the United Kingdom. We find that returns to occupation tenure are substantial. All else equal, five years of occupation tenure are associated with a 3.3% increase in wages. We also find that industry tenure plays a non-negligible part in driving wage growth.

Suggested Citation

  • Fabien Postel-Vinay & Alireza Sepahsalari, 2023. "Labour Mobility and Earnings in the Uk, 1992–2017," The Economic Journal, Royal Economic Society, vol. 133(656), pages 3071-3098.
    • Handle: RePEc:oup:econjl:v:133:y:2023:i:656:p:3071-3098.
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    References listed on IDEAS

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    1. Kathryn L. Shaw, 1984. "A Formulation of the Earnings Function Using the Concept of Occupational Investment," Journal of Human Resources, University of Wisconsin Press, vol. 19(3), pages 319-340.
    2. Parent, Daniel, 2000. "Industry-Specific Capital and the Wage Profile: Evidence from the National Longitudinal Survey of Youth and the Panel Study of Income Dynamics," Journal of Labor Economics, University of Chicago Press, vol. 18(2), pages 306-323, April.
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