Worker Turnover across Italian Regions

This paper provides prima facie evidence of the geographical distribution of worker turnover within Italian regions as measured based on the longitudinal files of the labor force survey for the period 2004-2010. It explains the stylized facts emerging from this enquiry with an interpretation based on the industrial change literature. Industrial turbulence is driving labor turnover within regions, rather than labor market flexibility, as the correlation with the Lilien (positive) and the Herfindahl (negative) indices, respectively, shows. In other words, industrial change causes greater job destruction and flows into and out of unemployment, while, as also Alfred Marshall noted, the availability of more specialised districts could partly offset the diseconomies of specialization in terms of greater exposure to external shocks, when the unit of analysis is sufficiently large, as it is in our case (NUTS1 and NUTS2). We also find that, at an individual level, the regional gap in turnover rates is due to regional differences in the gender, age and education attainment of the workforce, as well as the share of temporary work contracts and the size of firms.