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Are Health Professionals Better Off in Foreign Industries?

Sofie Cabus

 

Abstract


This paper explores skill shortages in the Dutch life sciences and health
industry (LSH), referred to as recruitment bottlenecks. We particularly
focus on the extent to which inter-industry wage di¤erentials can explain
the decision to quit LSH, and theoretically embed this in the skill-weights
approach of Lazaer (2009). It is predicted that nurses drop-out of LSH in
case their weighted general skills pay-o¤ more in foreign industries than
seniority in LSH. It is also predicted that industries demanding rigorous
speci…c skills are prone to recruitment bottlenecks. The empirical strategy
bene…ts from data on abilities necessary to perform in the job. Owing
to iterative one-to-one matching, we make graduates homogenous with
respect to their general skills. The results are in line with the predictions:
health professionals, who leave LSH, can earn signi…cantly higher wages
of +2.00 percent. This estimate is driven by vertical industry mobility.
Keywords: Health Professionals; Nursing; Recruitment Bottlenecks;
Skill Shortages; Wage Di¤erentials;
Jel: I18; I21; J3

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