Do displaced workers lose occupational prestige?

Worker displacement has become a common feature of employment in the “flexible economy.” While studies of income losses and the duration of unemployment after displacement abound, and popular accounts argue that workers often lose status, less empirical attention has been paid to the quality or prestige of employment displaced workers are able to secure after a downsizing event. This paper helps to fill this gap in the literature by focusing on changes in occupational prestige among a nationally representative sample of displaced workers who became reemployed from the January 2004 Displaced Workers and Employee Tenure Supplement of the Current Population Survey. Our findings show that displaced workers with higher levels of education, net of other factors, fared significantly better than others in job quality upon reemployment, highlighting the importance of education in retaining status and privilege in the new economy.