Free to Move? A Network Analytic Approach for Learning the Limits to Job Mobility

•Applies complex network analysis to describe boundaries to job mobility.•The network approach improves upon analysis of industry and occupation transitions.•The labor market has four mobility segments between which mobility is constrained.•There is evidence of positive assortative matching across segments.•Workers move more freely when unemployment is low. Boundaries are counter-cyclical.

Job mobility has many overlapping determinants that are hard to characterize solely on the basis of industry or occupation transitions. Workers may match with, and move to, particular jobs on the basis of match quality, preferences, human capital, andmobility costs. This paper implements a novel method based on complex network analysis to describe how workers move from job to job. Using data from the Panel Study of Income Dynamics (PSID), I find first that the labor market is composed of four distinct segments between which job mobility is relatively unlikely. Second, these segments are not well-described on the basis of industry, occupation, demographic characteristics, or education. Third, mobility segments are associated with earnings heterogeneity, and there is evidence of positive assortative matching across segments. Fourth, the boundaries to job mobility are counter-cyclical: workers move more freely when unemployment is low.