Magazine article Chicago Policy Review (Online)

How Far Would You Travel for Work? Disentangling the Effects of Geography, Job Search and Employment

Magazine article Chicago Policy Review (Online)

How Far Would You Travel for Work? Disentangling the Effects of Geography, Job Search and Employment

Article excerpt

After the financial crisis, the number of unemployed workers in the United States reached nearly 15 million in 2009 and the unemployment rate rose almost 10 percent in the same period. The slow recovery of the economy, and particularly of employment, has led to debate over the reasons for this trend and the appropriate policy responses. One hypothesis for explaining this behavior is that the recession caused a mismatch between job vacancies and unemployed workers. Thus, there is a misalignment between the location of the vacancies and the geographic preferences of those who are unemployed. A new study from Ioana Marinescu and Roland Rathelot discusses whether the geographic mismatch hypothesis is useful in understanding the high level of unemployment during the most recent economic recession.

The authors take advantage of a large and unique dataset to measure existing unemployment mismatch, which avoids the commonly used mismatching indices that impose constraints regarding the level of geographic mismatch. The authors construct a merged dataset from one of the largest U.S. employment websites, CareerBuilder.com. First, they obtained a random sample of registered unemployed users with active accounts between April and June 2012. Next, the authors took a sample of vacancies published on the website during the same period. They then merged the previous dataset in order to determine the jobs each candidate applied to. For job seekers (registered users) and the job openings (job postings) the authors have the location at the ZIP-code level.

Controlling for fixed effects, the results reveal that job seekers are less likely to apply to job vacancies farther away from their ZIP code. In particular, they found that a job seeker is 35 percent less likely to apply to a vacancy that is 10 miles away than to a vacancy that is in the job seekers’ ZIP code. …

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