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The Hidden Side of Temporary Employment: Fixed-term Contracts as a Screening Device

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  • Pedro Portugal
  • José Varejão

Abstract

In this article we look at how one specific form of temporary employment - employment with fixed-term contracts - fits into employers’ hiring policies. We find that human capital variables, measured at the levels of the worker and the workplace, are important determinants of the employers’ decisions to hire with temporary contracts and to promote temporary workers to permanent positions. Those employers that hire more with temporary contracts are also those that are more likely to offer a permanent position to their newlyhired temporary employees. Our results indicate that fixed-term contracts are a mechanism for screening workers for permanent positions.

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Bibliographic Info

Paper provided by Banco de Portugal, Economics and Research Department in its series Working Papers with number w201029.

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Date of creation: 2010
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Handle: RePEc:ptu:wpaper:w201029

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Cited by:
  1. Cardoso, Ana Rute & Hamermesh, Daniel S. & Varejão, José, 2008. "The Timing of Labor Demand," IZA Discussion Papers 3885, Institute for the Study of Labor (IZA).
  2. Bruno, Giovanni S. F. & Caroleo, Floro Ernesto & Dessy, Orietta, 2012. "Stepping Stones versus Dead End Jobs: Exits from Temporary Contracts in Italy after the 2003 Reform," IZA Discussion Papers 6746, Institute for the Study of Labor (IZA).

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