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Employment, job turnover, and trade in producer services: UK firm-level evidence

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  • Alexander Hijzen
  • Mauro Pisu
  • Richard Upward
  • Peter W. Wright

Abstract

We provide the first firm-level evidence of the impact of the trade in producer services (`offshoring') on the labour market. Using a new data set from the UK that measures trade in services at the firm level, we find no evidence that importing intermediate services is associated with job losses or greater worker turnover. Using regression to control for observable differences between firms that import service inputs and those that do not, we show that firms that start importing intermediate services experience faster employment growth than equivalent firms that do not. This seems likely to be the result of positive demand shocks, which cause a simultaneous increase in employment, output, and use of imported service inputs.

Suggested Citation

  • Alexander Hijzen & Mauro Pisu & Richard Upward & Peter W. Wright, 2011. "Employment, job turnover, and trade in producer services: UK firm-level evidence," Canadian Journal of Economics, Canadian Economics Association, vol. 44(3), pages 1020-1043, August.
    • Handle: RePEc:cje:issued:v:44:y:2011:i:3:p:1020-1043
    DOI: 10.1111/j.1540-5982.2011.01664.x
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    More about this item

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F2 - International Economics - - International Factor Movements and International Business
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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