Lower Wages through Job-Hopping

Photo: Banknotes

Frequent chance of employment
is linked to less wages; © Pixelio.de

To determine the impact of career mobility on worker’s wages, sociologist Sylvia Fuller of the University of British Columbia examined data from the 1979 National Longitudinal Survey of Youth, tracking nearly 6,000 workers during their first twelve years in the labor market.

Despite the frequent job moves made by young Americans today, Fuller’s research suggests that workers who frequently change jobs generally end up earning less than their more stable counterparts. By and large any benefits of job mobility accrue mainly in a worker’s early career. Fuller finds that both men and women typically experience substantial mobility during their early careers, although women change employers slightly less frequently than men.

Fuller’s research indicates that mobility can be a wage asset when it is concentrated in the early years of employment and not coupled with layoffs, discharges, employment gaps or family-related leave. In this case, moderate or even high levels of mobility can lead to equal or better wage outcomes than stability. Aside from this exception, Fuller finds that wage outcomes deteriorate as mobility rises.

One reason for lower wage trajectories among high-mobility workers is their failure to accumulate valuable early tenure associated with staying up to five years with an employer. In the first five years of a job, each year of tenure is associated with approximately 2.4 percent higher wages for men and 2.9 percent higher wages for women.

However, after five years with an employer, women’s gains from tenure plateau and men’s begin to erode. Fuller also found that high-mobility workers tend to spend a greater proportion of time not employed and, all else being equal, a greater proportion of their job changes are the result of layoffs.

MEDICA.de; Source: American Sociological Association (ASA)