Working Paper Series
IFAU - Institute for Evaluation of Labour Market and Education Policy
The strength of the weakest link: sickness absence, internal substitutability and worker-firm matching
() and Olof Rosenqvist
Abstract: We study how employee sickness absence affects worker-firm
matching. We build on the idea that firms are sensitive to absence in jobs
with few substitutes (unique positions). Consistent with this, we show that
unique employees are less absent conditional on individual characteristics,
establishment fixed effects and detailed occupational information. Half of
this association is explained by sorting of low-absence workers into unique
positions but sorting is less pronounced under imperfect information.
Finally, job separations respond more to realized sickness absence in
unique positions. The findings suggest that the cost of production
disruptions is an important aspect of firms’ hiring choices.
Keywords: Sickness absence; production disruption; coworker substitutes; hiring strategies; (follow links to similar papers)
JEL-Codes: J23; J24; L23; M51; (follow links to similar papers)
40 pages, November 23, 2015
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