Over the past few years, there has been a keen interest, both in the popular press and among researchers, in whether job stability and job security have declined in recent years.1 With the recession that began in early 2001, there will be a renewed interest in this issue. Changes in job security have obvious implications for the welfare of workers. It is well known that job losers spend more time unemployed, and that they suffer persistent earnings losses after they find new jobs.2 However, it is less obvious why we should care about job stability. A decline in job stability could be either good news or bad news for workers, depending on the reason for the decline. For example, job stability could decline because economic conditions have worsened and workers have become more likely to lose jobs. Or stability could decline because economic conditions have improved and workers are finding better jobs.