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Compensating displaced workers

Author

Listed:
  • Donald O. Parsons

    (George Washington University, USA, and IZA, Germany)

Abstract

Job displacement poses a serious earnings threat to long-tenured workers through unemployment spells and lower re-employment wages. The prevailing method of insuring job displacement losses involves an uncoordinated combination of unemployment insurance and severance pay. Less developed countries often rely exclusively on public mandating of employer severance pay due to the administrative complexity of unemployment insurance systems. If both options are operational, systematic integration of the two is important, although perhaps not possible if severance pay is voluntarily provided.

Suggested Citation

  • Donald O. Parsons, 2018. "Compensating displaced workers," IZA World of Labor, Institute of Labor Economics (IZA), pages 444-444, September.
    • Handle: RePEc:iza:izawol:journl:2018:n:444
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    References listed on IDEAS

    as
    1. repec:mpr:mprres:5070 is not listed on IDEAS
    2. Cozzi, Marco & Fella, Giulio, 2016. "Job displacement risk and severance pay," Journal of Monetary Economics, Elsevier, vol. 84(C), pages 166-181.
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    9. Holzmann, Robert & Pouget, Yann & Vodopivec, Milan & Weber, Michael, 2011. "Severance pay programs around the world : history, rationale, status, and reforms," Social Protection Discussion Papers and Notes 62726, The World Bank.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    job displacement; unemployment insurance; wage insurance; severance pay;
    All these keywords.

    JEL classification:

    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies

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