Hiroshi Teruyama

(Professor, Kyoto University)

Yuji Genda

(Professor, the University of Tokyo)

SA relation between employment growth and worker flows found among individual establishments is investigated by using micro-data from the Employment Trend Survey conducted by Ministry of Health, Labour and Welfare. The period analyzed is between 1997 and 2005. Main findings are as follows:

The majority of worker flows into and out of an operating establishment consisted of hires and separations, that is, labor turnover through an external labor market. Both worker inflows and outflows had increased since 2000. The amount of labor reallocation among continuing jobs equals the amount of the difference between worker inflows and job creation. Job creation was stable in the period. Thus, the increase in worker inflows was caused by expansion of labor reallocation among continuing jobs. It also raised worker outflows with decreasing job destruction, since the amount of the reallocation equals the amount of the difference between worker outflows and job destruction.

Job creation due to establishment openings was more volatile than job destruction due to establishment shutdowns. Worker flows into operating establishments had a tendency to rise simultaneously with worker inflows due to establishment openings. Worker flows out of operating establishments and those out of closed establishments moved oppositely. Among operating establishments, outflows and inflows increased synchronously. Consequently, when worker flows due to establishment openings and shutdowns are considered, inflows fluctuated more than outflows.

Worker flows into and out of operating establishments are compared among size categories of firm to which each establishment belongs. Among the large firms, hires and separations had increased since the late 1990s and reached the same level as among the smaller-sized firms. Especially, increases in inflows among large firms were the source of increases in total inflows we had observed since 2002.

Worker flows into and out of operating establishments are compared among industry categories. Worker flows in the wholesale and retail, the service and the manufacturing sectors accounted for seventy to eighty percent of the total worker flows. Worker flows in the wholesale and retail industry were the largest and has been increasing since 2000.