Title: Raising the bar for models of turnover
Description: "It is well known that turnover rates fall with employee tenure and employer size.  We document a new empirical fact about turnover: Among surviving employers, separation rates are positively related to industry-level exit rates, even after controlling for tenure and size.  Specifically, in a dataset with over 13 million matched employee-employer observations for France, we find that, all else equal, a 1 percentage point increase in exit rates raises separation rates by 1/2 percentage point on average.  Among current year hires, the average effect is twice as large.  This relationship between exit rates and separation rates is robust to a host of data and statistical considerations.  We review several standard models of worker turnover and argue that a model with firm-specific human capital accumulation most easily accounts for this new empirical fact"--Federal Reserve Board web site.