Inequality in the Risk of Job Loss: Is It Explained by Human Capital or Structural Factors?

Anna Baranowska-Rataj, Umeå University
Iga Magda, Warsaw School of Economics

We aim at identifying the factors that drive inequality in the risk of job loss between the young and prime-age workers in Poland. Decomposing the nonlinear probability of job loss we quantify the impact of the differences in the composition of individual endowments, workplace characteristics as well as macro-level structural changes between the two groups and investigate whether these factors protect youth and prime age workers to different extent. The accumulation of human capital on the one hand and the allocation of young and prime age workers into specific occupations, industries and jobs on the other are of particular interest in our research. We focus on Poland, as its dynamic structural changes and high labor turnover make it a particularly interesting case to research the mechanisms through which structural factors affect individual opportunities and risks.