Sources of displaced workers’ long-term earnings losses

Project Summary:

Pervasive earnings losses are a well-documented feature of job displacement, yet the understanding of the sources of these earnings losses is limited. The decline could be due to a lower wage at a new job, a lower likelihood of finding a new job, working fewer hours, or the loss of firm-specific rents. This project proposes to take advantage of employer-employee matched administrative data from Washington state’s unemployment insurance program to better understand the sources of earnings losses and to analyze the role of employer characteristics in job losses. Obtaining a better diagnosis of the root causes behind the long-term earnings decline can lead to better-designed policy responses.


Marta Lachowska is a Senior Economist at the W.E. Upjohn Institute for Employment Research. She completed her PhD in economics at Stockholm University in 2010, and spent three semesters at Princeton University’s Industrial Relations Section while working on her dissertation. Marta has research interests in the economics of social insurance, labor economics, and the economics of education. Her work has been supported by the U.S. Department of Labor, Poland’s National Science Centre, and the William T. Grant Foundation, and has been published in the Journal of Human Resources, Labour Economics, Oxford Economic Papers, and Research in Labor Economics, among others.