Did the Job Ladder Fail After the Great Recession?

We study employment reallocation across heterogeneous employers through the lens of a dynamic job-ladder model, where more productive employers spend more hiring effort and are more likely to succeed in hiring because they offer more. As a consequence, an employer's size is a relevant proxy for productivity. We exploit newly available U.S. data from JOLTS on employment flows by size of the establishment. Our parsimonious job ladder model fits the facts quite well, and implies `true' vacancy postings by size that are more in line with gross flows and intuition than JOLTS' actual measures of job openings, previously criticized by other authors. Focusing on the U.S. experience in and around the Great Recession, our main finding is that the job ladder stopped working in the GR and has not yet fully resumed.