The labor market integration of immigrants is a top political priority throughout the Organization for Economic Cooperation and Development (OECD) countries. Social and fiscal gains, as well as sustained future labor supply make governments search for effective policies to increase employment...

The paper presents a tractable general equilibrium model of search unemployment that incorporates absence from work as a distinct labor force state. Absenteeism is driven by random shocks to the value of leisure that are private information to the workers. Firms offer wages, and possibly sick...