Skill erosion during unemployment was of particular concern as unemployment duration increased in the Great Recession … unemployment pool's skill composition, and hence the output produced by other firms' new hires. As a consequence, job creation is …

There is little internal propagation of unemployment in standard search and matching models. When calibrated to the … high levels of worker flows observed empirically, unemployment in these models rapidly converges back to its steady state … level. We illustrate that even with high worker flows between employment and unemployment, slow movements in the composition …