Inside the perpetual-motion machine: cross-country comparable evidence on job and worker flows at the industry and firm level

Many studies suggest that idiosyncratic firm-level characteristics shape both job and worker flows in a similar way in all countries. Others argue that cross-country differences in terms of gross job flows are minor. However, these statements are usually based on the comparison of national estimates, typically collected on the basis of different definitions and collection protocols. In contrast, in this article, we use cross-country comparable data on both job and worker flows to examine key determinants of these flows and of their cross-country differences. We find that idiosyncratic firm characteristics (industry, age, and size) play an important role for both gross job and worker flows in all countries. Nevertheless, in contrast with part of the literature, we find that, even controlling for these idiosyncratic factors, cross-country differences concerning both gross job and worker flows appear large and of a similar magnitude. Both job and worker flows in countries such as the USA and the UK exceed those in certain continental European countries by a factor of two. Moreover, the variation of worker flows across different dimensions is well explained by the variation of job flows. Consistently, churning flows, that is flows originating by firms churning workers and employees quitting and being replaced, display much less variation across countries.