More than ten percent of U.S. workers separate from their employers each quarter. Some move directly to a new job with a different employer, some become unemployed, and some exit the labor force. The flow of new hires is similarly large, and somewhat larger whenever aggregate employment expands. The magnitude of hires and separations underscores the dynamic character of U.S. labor markets and draws attention to questions of search and matching, recruiting, applicant screening, and employee retention. It also provides powerful motivation for theories of frictional unemployment. The economic forces behind worker flows can be grouped into two broad categories. On the “demand side”, employers create new jobs and destroy old ones in large numbers every quarter. These job flows account for a large fraction of the separations and hires measured at the employer level and a large fraction of the job changes and movements into and out of employment measured at the worker level. Additional worker flows arise as outcomes of job-worker matching and “supply-side” events such as retirements, labor force entry and family relocation. Roughly speaking, job flow measures capture demand-side developments, while worker flow measures reflect events and developments in both broad categories. Previous research considers a wide variety of data sources and measures to study job and worker flows in the U.S. economy (Davis and Haltiwanger, 1998). Recently, U.S. statistical agencies have developed some remarkable new surveys and administrative datasets that yield a richer, fuller picture of labor market flows.
