We analyse a paper that challenges traditional industry classifications by showing how firms are economically linked through shared labour demand rather than product markets. This includes how peer networks can shape firm behaviour and generate predictable stock returns for investors. Finally, we suggest some alternative data providers that investors can use to track labour demand through job postings, talent movement and other labour market signals to identify these linkages.

LITERATURE

We discuss the 2025 paper ‘Labor Links, Comovement, and Predictable Returns’ by Yukun Liu and Xi Wu.