The cyclical sensitivity of regional employment and unemployment differentials

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Abstract
Gordon I. R. (1985) The cyclical sensitivity of regional employment and unemployment differentials, Reg. Studies 19, 95–110. This paper examines inter-regional variations in the cyclical sensitivity of employment and unemployment in the UK over the past thirty years. It shows that the patterns for employment and for unemployment are quite different. The cyclical sensitivity of unemployment is greatest in the high unemployment regions while that for employment is greatest in the more industrial regions. It is argued that the primary reason for differences in the sensitivity of unemployment is not demand-side factors but cyclical variations in labour mobility between regions. Lower mobility in periods of high unemployment reduces the effectiveness of inter-regional supply adjustments and increases the variance of unemployment rates.

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