Labor Disputes and Worker Productivity

TL;DR

This study examines how labor disputes, specifically the 2012-13 NHL lockout, affected player productivity, revealing limited effects for European players and none for North American players, contributing to understanding work stoppages' impact.

Contribution

It provides the first empirical evidence on how labor disputes influence worker productivity using a natural experiment in professional hockey.

Findings

Limited productivity increase among European players

No significant effect on North American players

Supports literature on labor rents and productivity impacts

Abstract

We implement a propensity score matching technique to present the first evidence on the impact of labor supply decisions during labor disputes on worker productivity in the context of professional sports. In particular, we utilize a unique natural experiment from the 2012-13 National Hockey League (NHL) lockout, during which approximately 200 players decided to play overseas while the rest stayed in North America. We separate the players based on their nationality and investigate the effect of playing abroad on post-lockout player performance. We find limited evidence of enhanced productivity among European players, and no evidence of a benefit or drawback for North American players. The lack of consistent productivity impact is in line with literature in industries with large labor rents, and we propose several additional explanations within the context of professional hockey. Our study contributes to the general understanding of the impact of employer-initiated work stoppage on labor productivity.