Concentration in Us Labor Markets: Evidence from Online Vacancy Data

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NBER Working Paper No. w24395

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José Azar; Ioana Elena Marinescu; Marshall Steinbaum; Bledi Taska
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paper description
Using data on the near-universe of online US job vacancies collected by Burning Glass Technologies in 2016, we calculate labor market concentration using the Herfindahl-Hirschman index (HHI) for each commuting zone by 6-digit SOC occupation. The average market has an HHI of 4,378, or the equivalent of 2.3 recruiting employers. 60% of labor markets are highly concentrated (above 2,500 HHI) according to the DOJ/FTC guidelines. Highlyconcentrated markets account for 20% of employment. Many plausible alternative market definitions show that more than 40% of markets are highly concentrated, suggesting that employers have market power in many US labor markets. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at