Worker–Plant Matching and Ownership Change

Is a change in ownership an opportunity for the new owners to make systematic changes to the workforce of the acquired plant? Using matched employer–employee data, we document changes to the workforce along observable and unobservable dimensions of worker quality around the time of ownership change. We observe above‐average separations of workers around domestic acquisitions. This is associated with a decline in unobserved worker quality in the plant. Foreign acquisitions are not associated with above‐average worker turnover; instead, new foreign owners share rents with the high‐skilled workers who are already in the plant before the acquisition.