Americans' Distrust May Be Hurting Job Market, Fed Paper Says
- 10-15 percent drop in job market fluidity since early 1980s
- Social capital decline is raising cost of job search, hiring
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The declining level of trust among Americans may have contributed to reduced flexibility in the U.S. labor market over the last several decades, according to a Federal Reserve working paper.
In the paper, Fed economists Raven Molloy, Christopher Smith and Riccardo Trezzi, along with University of Notre Dame professor Abigail Wozniak, identify a 10 percent to 15 percent decline in U.S. labor market fluidity -- a measure that encompasses workers switching jobs and moving states as well as employers creating or cutting positions -- since the early 1980s.