Why is it easier to find a job that matches your skills in a city than elsewhere? Because there are more jobs available of course, but maybe also because there are disproportionally more vacancies available per worker, which makes it easier to move from one job to another.
In their paper on ‘Are urban labour markets more dynamic? Vacancies and urban scaling’, published in Urban Economics, Harm-Jan Rouwendal and Jan Rouwendal show that there is indeed superlinear scaling of vacancies with employment size. That is, there are disproportionally more vacancies relative to employment in urban areas. Using online job vacancy data, the authors show that this is the case for overall employment, but also for specific occupational and educational classes. These findings are not explained by faster job growth in cities and the authors propose an alternative explanation based on vacancy chains in spatially related labour markets.
What does this mean? The results of this paper indicate that on-the-job searchers in urban areas have more possibilities in cities to find a better job. The findings help explain the higher mobility of especially younger workers in cities and the superior quality of job-worker matches in large labour markets.
November 2024