TY  - JOUR
AU  - Juhn, Chinhui
AU  - McCue, Kristin
AU  - Monti, Holly
AU  - Pierce, Brooks
TI  - Firm Performance and the Volatility of Worker Earnings
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 23102
PY  - 2017
Y2  - January 2017
DO  - 10.3386/w23102
UR  - http://www.nber.org/papers/w23102
L1  - http://www.nber.org/papers/w23102.pdf
N1  - Author contact info:
Chinhui Juhn
Department of Economics
University of Houston
Houston, TX 77204-5882
Tel: 713/743-3823
Fax: 713/743-3798
E-Mail: cjuhn@uh.edu

Kristin McCue
U.S. Census Bureau
CES/2K130E
4600 Silver Hill Rd
Washington DC 20233-6300
Tel: 301-763-1835
Fax: 301-457-1235
E-Mail: kristin.mccue@census.gov

Holly Monti
Economist
Social, Economic, and Housing Statistics Divison
Bureau of the Census
4600 Silver Hill Road
Washington, DC 20233
Tel: 301-763-1176
E-Mail: holly.monti@gmail.com

Brooks Pierce
Congressional Budget Office
E-Mail: brooks.pierce@cbo.gov
M1  - published as Chinhui Juhn, Kristin McCue, Holly Monti, Brooks Pierce. "Firm Performance and the Volatility of Worker Earnings," in Edward Lazear and Kathryn Shaw, organizers, "Firms and the Distribution of Income: The Roles of Productivity and Luck" Journal of Labor Economics, 36(S1) (2018)

AB  - Using linked employer-employee data for the U.S., we examine whether shocks to firm revenues are transmitted to the earnings of continuing employees.  While full insurance is rejected, the elasticity of worker earnings with respect to persistent shocks in firm revenues is small and consistent with the notion that firms insulate workers from idiosyncratic shocks. Exploring heterogeneity of effects, we find the largest elasticity in professional services, among employees in the top 5% of their employers’ earnings distribution, suggesting that in certain jobs performance pay may be a countervailing force to wage insurance.
ER  -