{"title":"Heterogeneous Layoff Effects of the US Short-Time Compensation Program","authors":"Marlon R. Tracey, Solomon W. Polachek","doi":"10.1111/labr.12184","DOIUrl":null,"url":null,"abstract":"<p>The Short-Time Compensation (STC) program enables US firms to reduce work hours via pro-rated Unemployment Insurance (UI) benefits, rather than relying on layoffs as a cost-cutting tool. Despite the program's potential to preclude skill loss and rehiring/retraining costs, firms' participation rates are still very low in response to economic downturns. Using firm-level UI administrative data and semi-parametric methods, we show why by illustrating which type of firms benefit from the program and which do not. A key finding is that cyclically sensitive firms have about 14% lower layoff rates when they use STC, but we find no difference for more cyclically stable firms.</p>","PeriodicalId":92093,"journal":{"name":"","volume":"34 4","pages":"399-426"},"PeriodicalIF":0.0,"publicationDate":"2020-10-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1111/labr.12184","citationCount":"4","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"","FirstCategoryId":"1085","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1111/labr.12184","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}
引用次数: 4
Abstract
The Short-Time Compensation (STC) program enables US firms to reduce work hours via pro-rated Unemployment Insurance (UI) benefits, rather than relying on layoffs as a cost-cutting tool. Despite the program's potential to preclude skill loss and rehiring/retraining costs, firms' participation rates are still very low in response to economic downturns. Using firm-level UI administrative data and semi-parametric methods, we show why by illustrating which type of firms benefit from the program and which do not. A key finding is that cyclically sensitive firms have about 14% lower layoff rates when they use STC, but we find no difference for more cyclically stable firms.
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