Worker turnover can be costly for firms due to imperfect worker substitutability in the labor market. Therefore, it is important to understand how worker substitutability affects employment behavior. Coping strategies, such as those used to mitigate turnover costs due to retirement, can be identified through understanding worker substitutability. In this context, by combining the literature on worker substitutability with that on labor supply effects of retirement reform, I show that older workers with specific skills who are difficult to substitute for, either in the internal labor market (by coworkers) or the external labor market (by new hires), are more likely to continue working when faced with a higher retirement age. The findings, based on a regression discontinuity design corresponding to a shift in the early retirement age, suggest that worker labor supply decisions are coordinated with firms based on their substitutability, thereby mitigating turnover costs. 

We focus on communication among hiring team members and document the existence of discrimination in the disclosure of information about candidates. In particular, we conduct an online experiment with a nationally representative sample of Czech individuals who act as human resource assistants and hiring managers in our online labor market. The main novel feature of our experiment is the monitoring of information flow between human resource assistants and hiring managers. We exogenously manipulate candidates' names to explore the causal effects of their gender and nationality on information that assistants select for managers. Our findings reveal that assistants disclose more information about family and less information about work for female candidates relative to male candidates. An in-depth analysis of the disclosed information suggests that gender stereotypes play an important role in this disclosure discrimination. Furthermore, assistants disclose less information about foreigners overall. This effect appears to be driven by the less attention assistants are willing to devote to the CVs of foreigners, measured by the extra effort to learn more about the candidates. 

Human capital specificity of establishments and search frictions may lead to costly worker turnover and career advancements. This paper quantifies the establishment adjustment costs upon older workforce retention using the reform in Germany that scrapped the opportunities to retire before the age 63. Using the exogenous cohort cutoffs for identification and administrative records of Germany as a data source, I show that the reform led to a significant increase in employment and retention of affected workers, and find that there are negative effects on hiring and promotions, especially of middle-aged women. These adjustment costs mask substantial heterogeneity across the availability of internal and external substitutes, showing that the longer planning horizon specific to this reform does not eliminate the adjustment costs for establishments because of the frictions associated with worker turnover.