Consequences of Job Mobility for the Subsequent Earnings at the Beginning of the Employment Career in Germany and the UK

Using the German Socio-Economic Panel 1984-2006 and British Household Panel Survey (BHPS) this paper investigates job-to-job mobility (direct job mobility) and job mobility via unemployment (indirect job mobility) at the beginning of the employment career in Germany and the UK. The analyses show that, in Germany’s rigid labour market, direct voluntary job mobility brings permanent income rewards. Indirect job mobility, on the other hand, has a long-lasting scar effect for voluntary job movers. In contrast, in the UK not only voluntary direct job mobility but also voluntary indirect job mobility is rewarded by income gains.