The impact of displacement on the earnings of workers in Ireland

McCarthy, Nóirín; Wright, Peter W.

The impact of displacement on the earnings of workers in Ireland

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Published version

Date

2018

Authors

McCarthy, Nóirín

Wright, Peter W.

Publisher

Economic and Social Studies

Abstract

In this paper we estimate the earnings losses of displaced workers. We use a novel matched worker-firm dataset to estimate earnings losses associated with mass-layoff and closure events in Ireland. Using propensity score matching and difference-in-differences estimators, we find that in the year following displacement, workers who experience a mass-layoff incur losses of 77 per cent compared to losses of 46 per cent for those displaced following a closure, relative to earnings five periods prior to displacement. However, those who are re-employed immediately after displacement suffer much smaller losses of 36 per cent and 19 per cent in the mass-layoff and closure groups respectively. Those displaced in the 2008-2010 group suffer greater earnings losses than those displaced between 2005 and 2007.

Keywords

Earnings , Workers , Ireland

Citation

McCarthy, N. and Wright, P. W. (2018) 'The Impact of Displacement on the Earnings of Workers in Ireland', Economic and Social Review, 49(4) Winter, pp. 373-417.