Worker Betas: Five Facts about Systematic Earnings Risk

摘要

How are the labor earnings of a worker tied to the fortunes of the aggregate economy, his employer, and his industry? How do these risk exposures vary by gender, age, the worker's earnings level, industry, and the size of his employer? The answers to these questions have important implications for various theories in macro, labor, and financial economics. In this paper, we use a large and clean panel dataset on individual earnings from the US Social Security Administration to answer these questions. In particular, we estimate the risk exposure of a worker's earnings to three important risk factors: the aggregate economy, the performance of the worker's employer, and the performance of the worker's industry.