Job employment intensity, matching, and earnings 1999–2005

In this paper, we exploit the worker-firm “link” information in the Linked Employer-Employee Database (LEED) to describe the patterns of employment intensity in jobs, matching between workers and firms, and the effect on job-level employment and earnings. First, we characterise workers’ annual employment experiences by their full-time (within month) and full-year (across months) dimensions, and firms’ mix of full-time and full-year jobs, and describe the extent of matching along these dimensions. We identify substantial cross-sectional variation in average employment intensity separately for workers and for firms, and some evidence that high-intensity workers are disproportionately employed in high-intensity firms. We then examine the relationship between jobs’ employment intensity and their earnings rates. Although there is a strong positive correlation between employment intensity and earnings that is largely associated with the full-time dimension, after controlling for other worker and firm factors, we find that there is only a modest direct impact of intensity on earnings. We conclude that the earnings premium associated with the full-time employment intensity is relatively small, and there is a premium for part-year work. The full-time employment intensity premium consists of both a continuous gradient across part-time levels and a discrete premium associated with full-time work.