Publication Date

1-21-2021

Series

Upjohn Institute working paper ; 21-339

DOI

10.17848/wp21-339

Abstract

This paper estimates that long-run changes in a county’s prime-age employment rate are significantly affected by labor demand shocks to both the county and its overlying commuting zone (CZ). The overall benefits of labor demand shocks are due more to CZ demand shocks than county demand shocks. A lower preexisting county employment rate increases the effects of CZ demand shocks. Simulations suggest that low prior employment rate CZs, versus higher-rate CZs, will have much larger employment rate effects from demand shocks. Targeting jobs at more distressed counties within a CZ has modest effects, much lower than the effects of targeting jobs at more distressed CZs.

Issue Date

January 2021

Note

Upjohn project #34438

Sponsorship

Smith Richardson Foundation

Subject Areas

ECONOMIC DEVELOPMENT; Local labor markets

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Citation

Bartik, Timothy J. 2021. "How Long-Run Effects of Local Demand Shocks on Employment Rates Vary with Local Labor Market Distress." Upjohn Institute Working Paper 21-339. Kalamazoo, MI: W.E. Upjohn Institute for Employment Research. https://doi.org/10.17848/wp21-339