Inter-firm job mobility and occupational transitions in Spain: are they related?
| Published date | 30 September 2014 |
| Date | 30 September 2014 |
| Pages | 674-692 |
| DOI | https://doi.org/10.1108/ER-05-2013-0057 |
| Author | Antonio Caparrós Ruiz |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations |
Inter-firm job mobility and
occupational transitions in
Spain: are they related?
Antonio Caparr
os Ruiz
Department of Statistics and Econometrics, University of M
alaga,
M
alaga, Spain
Abstract
Purpose – The purpose of this paper is to shed knowledge about the relationship between the
inter-firm job mobility and the occupational transitions in Spain during the last years. In particular, it
is tested whether if the type of job-to-job mobility (voluntary or involuntary) has some influence on the
workers careers. The empirical analysis is based on panel data provided by the Living Condition
Survey, which is conducted by the Spanish Statistics Institute (INE). The period analysed covers the
years between 2005 and 2010 (both inclusive), what allows observing the labour mobility patterns in
the recent Spanish economic crisis.
Design/methodology/approach – The econometric specification used to analyse occupational
mobility corresponds to a random effect panel multinomial logit model. The econometric model is
estimated separately for workers that have remained at the same firm and for workers who have
changed firms; for the latter group, a dummy variable indicating whether the individual quit or was
laid off is included as a regressor.
Findings – The results derived from the estimates of the econometric specifications show that
individuals who voluntarily leave a firm find the decision has a positive effect on their careers, as their
probability of upward occupational mobility is more than 90 per cent higher than for individuals who
leave their previous position as a result of having been laid off.
Social implications – This result is an argument in favour of adopting active labour market policies
that help improve information flows in the labour market and allow workers a better understanding of
potential job offers from outside firms.
Originality/value – This paper analyses the relationship between inter-firm mobility and occupational
transitions that has not yet addressed in the economic literature for Spain.
Keywords Labour market, Labour mobility, Labour market flexibility, Human capital, Panel data
Paper type Research paper
Introduction
Labour mobility has been a central topic in economics literature in recent years, with
its role as a mechanism for improving the allocative efficiency of workers, in particular,
attracting much interest from researchers. The continued internationalisation of economies
and the emergence of the so-called “knowledge economy” also have boosted the
importance of job mobility due to the increased need for a workforce with renewed
human capital, which in turn has enabled labour to adapt to recent technological
changes and to fluctuations in the demands for particular goods and services[1]
(Muffels and Luijkx, 2008). Seen from the vantage point of the match betwe en
employee and employer, changes affecting worker productivity have led to alterations
in the initial conditions of employment. As a result, employees now must decide
whether to stay in their present job or to pursue a change in their occupational status at
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/0142-5455.htm
Received 29 May 2013
Revised 20 December 2013
5 March 2014
Accepted 27 March 2014
Employee Relations
Vol. 36 No. 6, 2014
pp. 674-692
rEmeraldGroup PublishingLimited
0142-5455
DOI 10.1108/ER-05-2013-0057
The author thanks the Associate Editor and an anonymous referee for providing useful
comments and suggestions.
674
ER
36,6
different stages of their labour relationships (see, e.g. Jovanovic, 1979; Sicherman and
Galor, 1990). In addition, the emergence of new social patterns and the need to balance
family life and work life signal a new phase for the labour market, one in which job
mobility and the development of new work patterns are relevant efforts to improve and
increase social and economic welfare.
In Spain, labour mobility research has been restricted mainly due to the lack of
suitable data with which to study the phenomenon. Most such studies have used the
longitudinal data provided by the European Community Household Pane l for Spain
(1994-2001). The first paper to use this survey data to examine the topic of labour
mobility was Caparr
os et al. (1999), in which the authors analysed the relationship
between external labour mobility and improvement in individuals’ working conditions.
Subsequently, Caparr
os (2003) extended the scope of research by considering how
voluntary labour mobility affectedwages and stability in Spanish labour relationships.
More recently,Bl
azquez (2009) and Davia (2010) studied the influence of job mobility on
earnings mobility and wage growth, respectively.
To the best of my knowledge, economic literature discussing Spain has not yet
addressed the relationship between inter-firm mobility and occupational transitions.
These two important notions are closely related to the possibility of accessing the best
labour market opportunities. Vertical occupational mobility, whether intra-firm or
inter-firm, is frequently considered essential to an individual’s career progression.
This close relationship can be traced back to the hypothesis that occup ational mobility
causes or contributes to substantial and persistent changes in ear nings; Keane and
Wolpin (1997), for instance, modelled how an optimal sequence of occupations would
act to maximise an individual’s expected lifetime ear nings. On the other hand,
Sicherman and Galor (1990) referenced the link between inter-firm job mobility and
occupational mobility in scenarios in which an individual has chosen a feasible career
path-one characterised by the transferability of skills and experience from one
occupation to another and by moves between multiple firms. In such a scenario, the
authors assumed a worker would quit their job if they were not promoted and the
expected value of their future earnings would increase with a move to another
firm – where they would likely have been promoted as p art of the change, or where
they would have a g reater likelihood of future upward occupational mobility. In short,
quitting is, and should be seen as, part of a worker’s optimal career path. Alter natively,
the individual may change comp anies as a result of being laid off – that is, their
decision to exercise inter-firm mobility may be involuntary, initiated by their previous
employer. In such a scenario, inter-firm mobility also can induce downward occupational
mobility (see, e.g. Evans, 1998). This may be due to the loss of productivity associated
with a prolonged period of unemployment or to the stigma associated with the fact of
their dismissal, among many other reasons.
This paper attempts to fill the gap that surrounds this topic in the liter ature
concerned with the economy of Spain through an analysis of the causality between the
type of job-to-job mobility (voluntary or involuntary) and the type of occupational
mobility (downward, no mobility or upward). In particular, the effects of different
personal and labour characteristics on the probability of occupational c hange are
estimated, with distinctions made between workers who prog ress along their career
path while remaining with a single firm and those who progress by moving between
multiple firms. Hence, this paper will test the economi c prediction that states that
those who quit a position are more likely to exp erience upward occupational mobility
than those who are laid off. Second, this study will allow for the detection of those
675
Inter-firm job
mobility and
occupational
transitions
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