The Extent and Cyclicality of Career Changes: Evidence for the U.K..

Using quarterly data for the U.K. from 1993 through 2012, we document that in economic downturns a smaller fraction of unemployed workers, when starting a new job, start it in a new occupation or industry (a career change, in the parlance of this paper). Moreover, the proportion of total hires that involves a career change for the worker also drops in recessions. Together with a simultaneous drop in overall turnover, this implies that the number of career changes declines during recessions. These results suggest that recessions are times of subdued occupational and industrial reallocation, and do not reflect, or point to, a large role of accelerated and involuntary structural transformation. We investigate this interpretation further, with evidence on who changes careers, which industries and occupations they come from and go to, and at which wage gains.