Working papers

Does Turnover Inhibit Specialization? Evidence from a Skill Survey in Peru  with Munseob Lee and Claudia Macaluso.                                                          Conditionally Accepted, AER: Insights

We design, pilot, and field a new survey of job skills in Peru, to investigate human capital differences between poor and rich countries. Peruvian jobs have markedly more uniform skill profiles than jobs in the US. On the other hand, matching frictions are no more severe than in the US, and recruiting technology is largely equivalent as well. We propose a stylized model in the O-ring tradition, in which a labor demand preference for unspecialized workers can endogenously arise when there is uncertainty about labor availability.

Job Dynamics with Staffed Labor  with Claudia Macaluso and Chen Yeh.

This paper quantifies the role of staffing in both plant-level employment adjustments and aggregate job reallocation. Staffing happens when businesses source labor through "renting'' workers from staffing agencies, in place of direct hiring. We find that staffing is an important channel to both micro- and macro-economic job dynamics. Leveraging administrative data sources for U.S. manufacturing, we show that staffing is widespread and rising over time. On a yearly basis, one in two manufacturing plants recruits at least some of its workers through staffing, and staffing expenditure as a share of revenue has gone up for most plants. Furthermore, we show that staffing allows plants to be more dynamic in response to demand shocks. In particular, changes in staffing employment are larger and more immediate than changes in payroll employment. The creation and destruction of staffed jobs are also a large and increasing portion of aggregate job flows. Staffed workers perform their tasks at the client business' premises and directives, alongside the client business' own employees, but they remain legally employed by the staffing agency throughout different client assignments. Thus, their job changes are unaccounted for in official tallies. This omission is material: since 2006, correcting the total job reallocation rate for the creation and destruction of staffed jobs accounts for 37% of the decline in the measured aggregate job reallocation rate. We conclude that staffing is a quantitatively relevant channel of adjustment both at the plant-level and in the aggregate, and that the strategic use of staffing by U.S. manufactures underlies a significant shift, but not necessarily only a drop, in labor market dynamism.

This paper investigates whether domestic outsourcing accounts for the decline in worker reallocation the U.S. has experienced in the last decades. Domestic outsourcing happens when firms contract with other firms or individuals in the U.S. to provide goods and services previously performed in-house. On the other hand, outsourced employees are workers whose employer of record (the staffing agency) is not the firm where they perform their job tasks (the client). While remaining on their staffing agency’s payroll, outsourced employees reallocate across client firms. In fact, they do so at a higher pace than payroll employees, but their reallocations are omitted in the datasets used to measure labor fluidity. Therefore, the measured pace of reallocation is underestimated. To quantify this channel, I provide a decomposition of the worker reallocation rate that illustrates a relationship between the decline in reallocations and an increase in outsourced employees’ job tenure. I successfully test this implication in microdata from the Job Tenure Supplement of the Current Population Survey. I find that between 1996 and 2018, outsourced  employees average tenure increased by 18 months, while the average tenure of payroll employees increased by less than 8 months. The tenure estimates translate into an increasing proportion of omitted reallocations between 1994 and 2018, accounting for over one-fifth of the observed decline in the worker reallocation rate.

Work in progress

Global Gender Wage Gaps along the Wage Distribution and the Legal and Social Environment  with Kathleen Beegle and Josefina Posadas.

Heterogeneity in Post-secondary Human Capital Formation  with Darwin Cortés and Julieth Santamaria.                                                                                  Foco Económico entry (in Spanish).

Selected World Bank work and publications

The Economics of the Gender Wage Gap in Armenia (2018). World Bank WPS 8409. Coauthored with Lourdes Rodriguez Chamussy and Nistha Sinha.

Gender differences on sexual behavior and school inputs: Evidence from Bogotá (2015). Universidad del Rosario working paper 175. Coauthored with Darwin Cortés and Juan Miguel Gallego. Presented at LACEA 2016.                                                                                                                                                                                               Foco Económico entry (in Spanish).