Published in Working paper, 2020
Firms that responsively match supply to demand may pay a steep price for internally generated disruptions to productivity. In the case of responsive manufacturers, their performance depends on variable workloads of tasks being completed by coordinated groups of workers—and thus may suffer when workers leave. By tracking the staffing and productivity of tens of thousands of assembly line workers, we show that worker turnover significantly affects productivity by severing knowledge-sharing and relationships between assembly line co-workers. We show considerable value from a less turnover-prone workforce and that workers’ incentives can be designed to effectively control operationally disruptive worker turnover.
Recommended citation: Moon, K., Bergemann, P., Brown, D., Chen, A., Chu, J., Eisen, E., Fischer, G., Loyalka, P., Rho, S., and J. Cohen. (2020). "Manufacturing Productivity with Worker Turnover" Working paper. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3248075