Scandinavian Working Papers in Economics

Working Paper Series,
Trade Union Institute for Economic Research

No 161: Competition, Market Structure and Job Turnover

Jesper Antelius and Lars Lundberg
Additional contact information
Jesper Antelius: Trade Union Institute for Economic Research, Postal: FIEF, Wallingatan 38, SE-111 24 Stockholm, Sweden
Lars Lundberg: ESA, Postal: University of Örebro, SE-701 82 Örebro, Sweden

Abstract: Data for rates of job turnover among plants in the Swedish economy in 1986-97 imply that in a typical year in a representative industry one out of six jobs disappeared, and a corresponding number of jobs were created. Job turnover is counter-cyclical, with no trend, and is higher for skilled jobs, and lower in manufacturing, than for all jobs. The rate of job turnover seems to be higher in industries with high rates of innovation and market growth, which may indicate that the volatility of firm specific demand and supply shocks is higher in such industries. Moreover, for given shocks, turnover is higher in industries with many small plants and low return on capital. The results support the hypothesis that market shares are more stable, and thus reallocation of jobs limited, in industries where firms have strong market power. Finally, there is less job turnover in export oriented industries where foreign ownership is widespread. Firms selling in many markets and/or producing in different locations may be able to even out the employment effects of shocks specific to individual markets and/or locations.

Keywords: Job turnover; Market structure; International competitiveness

JEL-codes: F10; J63

25 pages, November 6, 2000

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