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Have labour market reforms at the turn of the millennium changed job durations of the new entrants? A comparative study for Germany and Italy

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According to the aims of the labour market reforms of the 90s implemented in many European countries, workers may stay at their first job for a shorter time, but should be able to switch jobs easily. This would generate a trade-off between job opportunities and job stability. This paper addresses this issue using administrative longitudinal data for Germany and Italy, two countries which have undergone changes in regulations that can be summarised under the header of “deregulation”.The estimated piecewise constant job and employment duration models show that changes in the durations of the first job and employment - measured as the sum of multiple consecutive jobs - are observed in periods of labour market reforms. However, the existence of a trade-off is not confirmed by the results. In Germany, men have experienced an increase in employment stability over time, mated with somewhat longer job durations, while women have not benefitted from an increase in employment durations as a compensation for the marked decrease in their first job durations. In Italy, employment stability of the new entrants of both sexes has not improved after the reforms. The reduction in the duration of the first job has not been counterbalanced by an increase in the opportunity to find rapidly another job. These results suggest that the objective of increasing job opportunities by means of labour market deregulation has not been fully achieved.

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Paper provided by Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa in its series Working Papers - Economics with number wp2010_06.rdf.

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Length: 42 pages
Date of creation: 2010
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Handle: RePEc:frz:wpaper:wp2010_06.rdf

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Keywords: employment duration; work career; tenure; precarious jobs; labour market reforms; mixed proportional hazard;

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  1. Alison L. Booth & Marco Francesconi & Jeff Frank, 2002. "Temporary Jobs: Stepping Stones or Dead Ends?," LABORatorio R. Revelli Working Papers Series 8, LABORatorio R. Revelli, Centre for Employment Studies.
  2. Boockmann, Bernhard & Hagen, Tobias, 2008. "Fixed-term contracts as sorting mechanisms: Evidence from job durations in West Germany," Labour Economics, Elsevier, vol. 15(5), pages 984-1005, October.
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Cited by:
  1. Bruno Contini & Elisa Grand, 2012. "Long Term Youth Unemployment or Disposable Workforce?," Carlo Alberto Notebooks 260, Collegio Carlo Alberto.
  2. Bruno Contini & Elisa Grand, 2010. "Long term youth unemployment or disposable workforce?," LABORatorio R. Revelli Working Papers Series 101, LABORatorio R. Revelli, Centre for Employment Studies.
  3. Tealdi, Cristina, 2011. "How do employment contract reforms affect welfare? Theory and evidence," MPRA Paper 33573, University Library of Munich, Germany.
  4. Tealdi, Cristina, 2011. "Typical and atypical employment contracts: the case of Italy," MPRA Paper 39456, University Library of Munich, Germany.

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