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CEEDD

Canadian Employer-Employee Dynamics Database

Description

  • Nature: Longitudinal administrative database of employers and employees.
  • Usage: The database can be used to study many issues, including: projects on business start-ups and job creation, with particular emphasis on the role of immigrant entrepreneurs; the distribution of immigrants across business enterprises and how this differs from the distribution of Canadian-born workers; how workforce is affecting businesses, including its effect on labour productivity; local labour market information, including hiring rates, separation rates, layoff rates, and aggregate turnover rates within sub-provincial regions; and the impacts of organizational changes, such as mergers and acquisitions, on individual-level outcomes.
  • Content: CEEDD is a matched employer-employee database which includes both firm-level and individual-level characteristics. It is a link between various tax files including the T1 personal, family and business declaration files, the T2 files (corporate tax return and owner files) and the T4 supplementary and summary files, as well as the longitudinal immigration database (IMDB).
  • Coverage period: 2001 to 2010.

Longitudinal Immigration Database (IMDB) 

  • Part of CEEDD
  • Provides detailed and reliable information on the performance and impact of immigration programs.

Funded Projects

In economic models of trade, it is stated that firms that are more productive will export, while those that are less productive will sell products domestically or completely exit the market. However, differences in productivity alone cannot explain why some firms export and some do not. One aspect that may limit a firms international trading opportunities is a lack of information regarding such opportunities, or a lack of assurance that trading agreements will be honoured. Members of migrant networks may play a role in overcoming such barriers by acting as mediators between the firm and potential trading partner. The objective of this research is to (1) determine the relationship between firms that export and the composition of their employees, and (2) how the Canadian immigration policy has shaped a firm’s ability to export. Specifically, this paper will explore if firms with foreign-born workers are more likely to export, if firms make hiring decisions based on the possibility of exporting, and if there is any evidence to suggest firms hire foreign-born workers to mitigate the information barriers discussed above.

Related Data Sets
CEEDD, TEC

Related Research Themes
Industry and Firm Analysis, International

     An extensive amount of literature has stated that immigrants may exhibit poorer economic performance than native-born citizens. There are three main reasons why this relationship may occur: (1) human capital, such as the education and labour market experiences, may be lower for immigrants, (2) language proficiency tends to be lower among immigrants, and (3) immigrants may have weaker networks or live in areas that consist predominately of one ethnic group, known as enclaves. The purpose of this study is to explore another potential reason why immigrants’ economic performance is lower, specifically, financial literacy. Financial literacy allows agents to make more informed decisions regarding saving, investing, borrowing, etc. Evidence from surveys have documented that there are large variations in financial literacy across demographic characteristics such as gender, education, age, religion, and ethnicity. This project studies whether immigrants in Canada are financially sophisticated by examining whether eligible immigrants take advantage of tax breaks. Higher levels of financial literacy may reflect higher levels of human capital, language proficiency and stronger social networks. Thus, this study will account for, or condition on language, education, and networks (measured by the proximity of businesses or individuals with similar demographics).

Related Data Sets
CEEDD

Related Research Themes
Incomes, International

This article takes advantage of new Canadian administrative linked employer-employee data to study the role of employers in explaining changes in inequality along two dimensions. First, we use information about the worker's employer to examine how within-firm and between-firm earning inequality evolved over the past decade. Second, we use firm-level productivity information to shed some light on the evolution of productivity inequality over the last decade. Finally, we interpret these findings in the light of current theories about increasing wage inequality and summarize how these results improve our understanding of the dynamics of productivity dispersion. More precisely, we link the changes in productivity inequality to changes in wage inequality to specifically address the question of how the two are closely connected or not.

Related Data Sets
CEEDD

Related Research Themes
Labour Markets

Beginning with the work of the economist Joan Robinson in the 1930’s, the word “monopsony" has been used in economics to refer to any market situation in which the buyer of a good possesses market power (i.e. some ability to choose the price at which they buy), regardless of whether or not there is actually only a single such buyer. Although monopsony power may be an important phenomenon in many different contexts, a growing body of research has focused on identifying and quantifying its extent in labor markets. Unfortunately, the existing empirical literature on this topic has thus far not meaningfully addressed one especially significant question, namely: to what extent do firms exploit all of the potential monopsony power available to them in setting the wages of their workers? The goal of our proposed study is to directly explore this question by using the CEEDD to simultaneously estimate both wage markdowns, or reduction of wages below what would be earned in a perfectly competitive market where firms have no wage-setting power, as well as the “full'' markdowns that would be predicted by standard models of an imperfectly competitive labor market, given the labor supply elasticity facing particular firms (a measure of how likely workers are to quit in response to wage cuts). Our hope is that these estimates will allow us to measure not only the average extent to which firms utilize their available wage-setting power, but also to explore heterogeneity in the same and to identify relevant correlates of being a “high-utilization" or “low-utilization" (of monopsony power) firm. We are particularly interested in studying whether firms with governance structures that allow for employee participation, including collective bargaining, are less aggressive monopsonists, as predicted by recent theoretical work on the topic.

Related Data Sets
CEEDD, NALMF

Related Research Themes
Industry and Firm Analysis, Labour Markets

We document the importance of secondary markets (i.e., business re-sale) for the growth and establishment of private businesses using administrative matched employer-employee data from Canada. In particular, we quantify the extent of ownership turnover among private firms and identify the characteristics of owners and firms that are most often associated with engaging in such transactions. In addition, by tracking individual firms over time, we document how firm growth responds to the presence of secondary markets and the corresponding impact on industry composition. This project fills a gap in the firm dynamics literature which has so far ignored the role of secondary markets for private businesses.

Related Data Sets
CEEDD, NALMF

Related Research Themes
Industry and Firm Analysis, Labour Markets

In this paper, we use linked employer-employe administrative tax data from Canada to estimate the impact of payroll taxes on a variety of firms and workers outcomes. At the firm-level, we use geographic and time variations in tax rates to identify the effect of payroll taxes on wage growth at the worker level. For one province, we exploit a clean overtime change in the payroll tax rate to estimate its impact on the firm's level of employment, average wage and productivity, with difference-in-differences models, taking into account firm-level unobserved heterogeneity. Additionally, taking advantage of the nature of linked data, we estimate wage equations with both fixed worker and firm fixed effects. We find no impact on employment and productivity but significant impacts on wages, implying that payroll taxes are passed almost entirely to workers in the form of lower wages.

Jonathan Deslauriers (HEC Montréal)

Jonathan Paré (HEC Montréal)
 

Related Data Sets
CEEDD

Related Research Themes
Industry and Firm Analysis, Labour Markets

The goal of the Global Income Dynamics Database Project is to provide a rich set of statistics on individual income dynamics for several countries, which are harmonized to make them comparable. The key difference between this project and others (for example, the World Income and Wealth Database of Piketty-Saez-Zucman, et al.) is the focus on dynamics (which requires longitudinal data rather than repeated cross-sections), and administrative data (which allows more sophisticated analyses with reduced measurement issues). This project will enable Canada to be a participant in this database along with 10 other countries (Brazil, Denmark, France, Germany, Italy, Mexico, Norway, Sweden, UK, and US). Canada is uniquely positioned to participate given the newly formed matched worker-firm panel data.

Related Data Sets
CEEDD

Related Research Themes
Incomes

This project sets out to investigate the impact of immigrant business ownership and employment on Canada's international trade. We propose to use Canadian Employer-Employee Dynamics database connected with data on imports and exports for the empirical analysis. We propose to quantify the effects of immigrant owned firms and immigrant employees on the extensive and intensive margins of imports and exports for products with different degrees of differentiation. We also plan to extend the analysis to examine whether the contribution of immigrant business ownership to international trade is affected by the cultural/linguistic distance between the country of origin and Canada.

Huju Liu

Related Data Sets
CEEDD

Related Research Themes
Labour Markets

The process of how the economic status of immigrants’ changes from the time of their arrival onward, and how they integrate into the labour market can determine what factors lead to improved outcomes. Another area of interest is how the career dynamics of immigrants and natives differ. The purpose of this study is to answer the following questions: (1) how do immigrants sort into different firms as they assimilate and how their networks play a role in this process, and (2) how firm-specific pay policies may affect immigrants and natives differently? While previous Canadian studies that have investigated the economic status of immigrants employ census-type data, this study will use longitudinal matched employer and employee data. This data is particularly useful as the same sample is tracked at different points in time. The study will look at changes in the characteristics of the jobs immigrants sort into as they assimilate. Such characteristics include the ratio of natives to immigrants in the firm and the size of the firm. Schmutte (2015) has shown that individuals whose neighbours are employed at high-paying firms are more likely to move to a firm that is higher-paying. It is of interest to see if this is the case for immigrants. This may distinguish if certain groups of immigrants that live in certain places assimilate faster.

Related Data Sets
CEEDD

Related Research Themes
Incomes, Industry and Firm Analysis, International, Labour Markets

Recent studies have indicated that the gains to shareholders from mergers and acquisitions (M&As) are a result of layoffs that occur post-merger. After an M&A, the firm undergoes restructuring. In this process, it is likely that some of the workforce at the combined firm may be laid off. While the wealth effects of shareholders are well documented, those of employees are not, especially in the Canadian context. The purpose of this study is to examine the well-being and wealth effect of workers that are employed at merged firms. Specifically, this study hopes to answer the following: (1) what is the effect on the level of employment after an M&A (2) what are the demographics (ex. age, gender, job skill level, family status) of terminated employees and (3) what are the future employment characteristics of such workers (i.e., type, earnings, sector, and location)?

Additional data set: Record of Employment (ROE)

Related Data Sets
CEEDD

Related Research Themes
Incomes, Industry and Firm Analysis, Labour Markets

This project investigates to what extent individual learning/experience and employment match quality affect firm creation (new entrepreneurship) and firm survival. Learning and experience is a proxy for the quantity of entrepreneurial human capital, and employment match quality is a proxy for the quality of such human capital. New entrepreneurship as an occupational choice is the outcome of accumulation of the entrepreneurial human capital, meanwhile,  this human capital as an initial condition may also affect the firm exit decision. To this end, we incorporate learning/experience and employment match quality into a dynamic model of occupational choice (i.e., switching between being an employee and being a business owner) using the matched employee-employer data CEEDD. The project also offers insights on the relative importance of financial wealth and entrepreneurial human capital in business formation.

Related Data Sets
CEEDD

Related Research Themes
Industry and Firm Analysis, Labour Markets

In this project, we will advance the findings of each of these papers by looking in detail at how workers move over their life course, examining in particular how multiple aspects of industrial change impact mobility. The analysis for this proposed research will draw on the Canadian Employer-Employee Dynamics Database (CEEDD), which contains rich data on both individual and firm-level characteristics that may motivate migration for close to two decades.

Nicole Denier (University of Alberta) and Federico Eichelmann-Lombardo (Western University)

Related Data Sets
CEEDD

Related Research Themes
Labour Markets

While there is a large body of literature studying the impact of minimum wages on employment, there is less research into how minimum wages affect firms. Minimum wages increase the cost of paying workers to firms. This gives firms a strong incentive to look for efficiencies, such as increasing performance standards or asking for greater proficiency in job duties. If workers can accomplish more in the same amount of time, they justify their pay increases; if this happens on large enough scale, the result is higher firm productivity. We will study minimum wage increases in Canada from 2001 to 2015 and explore whether these increases resulted in higher firm productivity.

Related Data Sets
CEEDD, NALMF

Related Research Themes
Industry and Firm Analysis, Labour Markets

Starting a business is risky because many businesses fail. Unsuccessful entrepreneurs may lose some of the money they invest, they may lose income by giving up a job in order to start the business, and after their business fails, they may not be able to find as high-paying a job as they had before. How important are these different losses for Canadian entrepreneurs? This project seeks to understand how these different risks discourage people with good ideas from starting businesses. By better understanding these risks, we can create public policy to more effectively encourage people to become entrepreneurs.

Related Data Sets
CEEDD

Related Research Themes
Incomes, Industry and Firm Analysis, Labour Markets

Related Themes

Industry and Firm Analysis

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Labour Markets

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Papers and Publications

September, 2023

We study the welfare implications of employment protection for older workers, exploiting recent bans on mandatory retirement across Canadian provinces. Using linked employer-employee tax data, we show that the bans cause large and similar reductions in job separation rates and retirement hazards at age 65, with further reductions at higher ages. The effects vary substantially across industries and firms, and around two-fifths of the adjustments occur between ban announcement and implementation dates. We find no evidence that the demand for older workers falls, but the welfare effects are mediated by spillovers on savings behavior, workplace injuries, and spousal retirement timing.

Author(s)

Todd Morris & Benoit Dostie 

Related Data Sets
CEEDD

Related Research Themes
Incomes, Industry and Firm Analysis, Labour Markets

Keywords: employment protection; retirement; welfare; active and passive savings responses; health effects; spousal spillovers

JEL Codes: J26, J78, H55

November, 2020

Using data from the Canadian Employer-Employee Dynamics Database between 2001 and 2015, we examine the impact of firms’ hiring and pay-setting policies on the gender earnings gap in Canada. Consistent with the existing literature and following Card, Cardoso, and Kline (2016), we find that firm-specific premiums explain nearly one quarter of the 26.8% average earnings gap between female and male workers. On average, firms’ hiring practices – due to difference in the relative proportion of women hired at high-wage firms, or sorting – and pay-setting policies – due to differences in pay by gender within similar firms – each explain about one half of this firm effect. The compositional difference between the two channels varies substantially over the life-cycle, by parental and marital status, and across provinces.

Related Data Sets
CEEDD

Related Research Themes
Incomes, Industry and Firm Analysis, Labour Markets

Keywords: Gender wage gap, Firm effects, Marital status, Linked employer-employee data, Pay-setting, Sorting

JEL Codes: J16, J31, J51, J71

May, 2020

     We use longitudinal data from the income tax system to study the impacts of firms’ employment and wage-setting policies on the level and change in immigrant-native wage differences in Canada. We focus on immigrants who arrived in the early 2000s, distinguishing between those with and without a college degree from two broad groups of countries – the U.S., the U.K. and Northern Europe, and the rest of the world. Consistent with a growing literature based on the two-way fixed effects model of Abowd, Kramarz, and Margolis (1999), we find that firm-specific wage premiums explain a significant share of earnings inequality in Canada and contribute to the average earnings gap between immigrants and natives. In the decade after receiving permanent status, earnings of immigrants rise relative to those of natives. Compositional effects due to selective outmigration and changing participation play no role in this gain. About one-sixth is attributable to movements up the job ladder to employers that offer higher pay premiums for all groups, with particularly large gains for immigrants from the “rest of the world” countries.

Author(s)

Benoit Dostie, Jiang Li, David Card, Daniel Parent

Related Data Sets
CEEDD

Related Research Themes
Incomes, International, Labour Markets

February, 2019

We examine how immigrant employment enhances trade at the firm level using unique administrative matched employer-employee data from Canada. We augment a standard model of firms’ export market entry and sales decisions with trade costs that depend on destination-specific immigrant employment at the firm level. We estimate simple structural equations derived from the model that relate destination-specific exporting decisions to immigrant employment. We develop a method to deal with the potential endogeneity of immigrant employment that exploits the optimality conditions associated with the firm’s employment decision. We find positive and statistically significant effects of firm level immigrant employment on exporting. These effects vary with product type and immigrant employee characteristics in ways consistent with the idea that immigrant employees alleviate information barriers to trade.

Author(s)

 

Related Data Sets
CEEDD

Related Research Themes
Industry and Firm Analysis, International, Labour Markets

June, 2018

In this paper, we use linked employer-employee administrative tax data from Canada to estimate the impact of payroll taxes on a variety of firms and workers outcomes. At the firm level, we use geographic and time variations in tax rates to identify the effect of payroll taxes on wage growth at the worker level. For one province, we exploit a clean overtime change in the payroll tax rate to estimate its impact on the firm’s level of employment, average wage and productivity, with difference-in-differences models, taking into account firm-level unobserved heterogeneity. Additionally, taking advantage of the nature of linked data, we estimate wage equations with both fixed worker and firm fixed effects. We find no impact on employment, productivity and profits, but significant impacts on wages, implying that payroll taxes are passed almost entirely to workers in the form of lower wages.

Author(s)

Jonathan Deslauriers (HEC Montréal)
Jonathan Paré (HEC Montréal)

Related Data Sets
CEEDD

Related Research Themes
Industry and Firm Analysis

Presented at Statistics Canada: Socio-Economic Workshop - Leading-Edge Business Micro Data and Updates on Access

June, 2017

March, 2017

Related Data Sets
CEEDD, TEC

Related Research Themes
Industry and Firm Analysis, International

Keywords: RDC, CDER

Presented at Data Day

Related Data Sets
ASM, ASM-I, CBSA Customs, CEEDD, CIP, CFA, LEAP, LWF, NALMF, SFSME, SIBS, T2-LEAP, TEC, WES

Related Research Themes
Incomes, Industry and Firm Analysis, International, Labour Markets

Presented at Data Day

Author(s)

Natalie Goodwin, Statistics Canada RDC Analyst, Western University RDC

Related Data Sets
ASM, ASM-I, CBSA Customs, CEEDD, CFA, CIP, LEAP, LWF, NALMF, SFSME, SIBS, T2-LEAP, TEC, WES

Related Research Themes
Incomes, Industry and Firm Analysis, International, Labour Markets

Keywords: RDC

Presented at Data Day

Outline

Accessing business microdata for research purposes at the Canadian Centre for Data Development and Economic Research (CDER) at Statistics Canada

  • CDER basics
  • Data sets available for access to CDER
  • Application process
  • Future directions
  • Other information

Related Data Sets
ASM, ASM-I, CBSA Customs, CEEDD, CFA, CIP, LEAP, LWF, NALMF, SFSME, SIBS, T2-LEAP, TEC, WES

Related Research Themes
Incomes, Industry and Firm Analysis, International, Labour Markets

Keywords: CDER; microdata; data access

Presented at Data Day

May, 2015

Related Data Sets
ASM, ASM-I, CBSA Customs, CEEDD, CFA, CIP, LEAP, LWF, NALMF, SFSME, SIBS, T2-LEAP, TEC, WES

Related Research Themes
Incomes, Industry and Firm Analysis, International, Labour Markets

Keywords: CDER; proposal

JEL Codes: Y9

Author(s)

Kim P. Huynh works at the Bank of Canada

Related Data Sets
ASM, ASM-I, CBSA Customs, CEEDD, CFA, CIP, LEAP, LWF, NALMF, SFSME, SIBS, T2-LEAP, TEC, WES

Related Research Themes
Incomes, Industry and Firm Analysis, International, Labour Markets

Keywords: CDER; proposal; microdata

JEL Codes: Y9

November, 2012