Noncompete agreements (NCAs) are pervasive even in low-wage labor markets, yet most evidence relies on variation in enforceability rather than NCA incidence. Using longitudinal data from the NLSY97, we study how signing an NCA affects wage trajectories and job tenure. Exploiting complete work histories and applying a "clean controls" local projections difference-in-differences design, we find a striking divergence: NCAs are associated with significantly slower wage growth for low-education workers over four years but faster wage growth for high-education workers. Effects on job tenure are imprecisely estimated for both groups.
Potter et al. (Fri,) studied this question.