Firms' Relative Sensitivity To Aggregate Shocks And The Dynamics Of Gross Job Flows

The author proposes a measure for the importance of aggregate shocks for fluctuations in job flows at the firm level. Using data for the Portuguese economy, it's found that large and old firms exhibit higher relative sensitivity to aggregate shocks and have a disproportional influence over the dynamics of aggregate job reallocation. In the overall economy, since large and old firms reallocate jobs less procyclically than small and young firms, job reallocation is less procyclical than if firm size and age classes were equally sensitive to aggregate shocks.