In this thesis I study labor market dynamics in a macroeconomic context. The first chapter infers a theory of employment using the differences in wage and employment outcomes of job changers. This theory is used to understand differences in levels of unemployment and predict the effect of policy prohibiting employment discrimination against the unemployed. The second chapter examines the evolution of employment volatility relative to output in the US over the past half century. I find the increase is driven by certain demographic subgroups that can be thought of as highly skilled. I use this variation to see if a theory of increased skill transferability can account for the overall macro increase in relative employment volatility. The final chapter, joint with Jacek Rothert, proposes a link between government housing policy and savings in China. We construct a model of learning by doing in exports and find that optimal government policy restricting residential construction raises employment and output in the tradeable sector. This produces both a current account surplus and can be rationalized as benevolent because of the growth externality in learning by doing.