Did the Housing Price Bubble Clobber Local Labor Market Job and Worker Flows When It Burst ?

We integrate local labor market data on worker flows (accession and separation rates), job flows (creation and destruction rates), employment levels, and earnings with MSA-level data on housing prices and local area unemployment, in order to study the local labor market dynamics associated with the U.S. housing price bubble of the late 2000s. We proceed to study the magnitude and timing of the relation between the changes in local housing prices and local worker and job flows, local labor market earnings. In addition to the unique contribution of using both local labor and housing market data, the paper also considers the contributions of the local labor markets to the aggregate movements in the worker and job flows.