One’s pain is another’s gain: Early career exposure and later labor market outcomes

Abstract This article investigates whether early career exposure of inexperienced employees to employers affects their later career outcomes. The extent to which entry-level workers get to demonstrate their abilities is an important determinant of how precisely the employer can estimate their talent. I implement a novel instrumental variable strategy, exploiting co-worker injuries as a source of random variation in junior employee working time. Co-worker injuries create vacant slots in team rosters, which are filled by junior workers, increasing their exposure. The results show that additional exposure increases junior workers’ rehiring probability as well as their post–entry-level salary and contract length (JEL M51, J63, J24, Z22).