No. 751 - Creation, destruction and reallocation of jobs in italian firms: an analysis based on administrative data

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by Luca Citino, Edoardo Di Porto, Andrea Linarello, Francesca Lotti, Andrea Petrella and Enrico SetteMarch 2023

This paper studies the dynamics of employment in firms to evaluate the extent to which jobs have been allocated efficiently among firms and sectors  between 1984 and 2021. The large temporal depth of the analysis makes it possible to identify the transformations of the production system, eliminating the influence of cyclical fluctuations.

Job destruction increased sharply during the pandemic, also involving the most productive firms, albeit to a lesser extent than others. Job reallocation, that can represent an indicator of the dynamism of a productive system, decreased much more rapidly than in previous recessions. Finally, the pandemic crisis has led to a shift in employment towards information and communication services and construction industries. The latter result is largely due to the tax incentives that supported the sector.