Advanced Search
MyIDEAS: Login to save this paper or follow this series

Are Temporary Jobs a Port of Entry into Permanent Employment? Evidence from Matched Employer-Employee Data

Contents:

Author Info

  • Fabio Berton

    ()
    (Department of Public Policy and Public Choice, University of Eastern Piedmont)

  • Francesco Devicienti

    ()
    (Department of Economics and Public Finance "G. Prato", University of Torino)

  • Lia Pacelli

    ()
    (Department of Economics and Public Finance "G. Prato", University of Torino)

Abstract

Are temporary jobs a port of entry into permanent employment? In this paper we argue that the answer crucially depends on the type of temporary contracts being considered, as the different contracts observed in practice are typically characterized by varying combinations of training, tax-incentives and EPL provisions. We base our empirical evidence on a longitudinal sample of labour market entrants in Italy, a country where a large number of temporary contracts coexist with a relatively high employment protection for standard employees. We estimate dynamic multinomial logit models with fixed effects, to allow for non-random sorting of workers into the different types of contracts. We show that the transition to permanent employment is more likely for individuals holding any type of temporary contracts than for the unemployed, thus broadly confirming the existence of port-of-entry effects. Yet, not all temporary contracts are the same: training contracts are the best port of entry, while freelance contracts are the worst. We also show that temporary contracts are generally a port-of-entry into a permanent position within the same employer, but not across firms, implying that little general-purpose training is gained while on temporary jobs. Moreover, the time needed for an internal transformation from a temporary to a permanent position appears rather long, suggesting that firms are likely to use (a sequence of) temporary contracts as a cost-reduction strategy, rather than as a screening device for newly hired workers.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://web.econ.unito.it/prato/papers/n6.pdf
File Function: First version, 2009
Download Restriction: no

Bibliographic Info

Paper provided by Former Department of Economics and Public Finance "G. Prato", University of Torino in its series Working papers with number 6.

as in new window
Length: 27 pages
Date of creation: Jun 2009
Date of revision:
Handle: RePEc:tur:wpaper:6

Contact details of provider:
Postal: Corso Unione Sovietica 218 bis, Torino
Phone: +39 011 6706128
Fax: +39 011 6706062
Email:
Web page: http://eco83.econ.unito.it/prato/
More information through EDIRC

Related research

Keywords: temporary jobs; port of entry; matched employer-employee data; dynamic multinomial logit models; state dependence; fixed effects;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Güell, Maia & Petrongolo, Barbara, 2003. "How Binding are Legal Limits? Transitions from Temporary to Permanent Work in Spain," CEPR Discussion Papers 3931, C.E.P.R. Discussion Papers.
  2. Andrea Ichino & Fabrizia Mealli & Tommaso Nannicini, 2008. "From temporary help jobs to permanent employment: what can we learn from matching estimators and their sensitivity?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 23(3), pages 305-327.
  3. Juan José Dolado & Carlos García-Serrano & Juan F. Jimeno, . "Drawing Lessons from the Boom of Temporary Jobs in Spain," Working Papers 2001-11, FEDEA.
  4. Matteo Picchio, 2008. "Temporary Contracts and Transitions to Stable Jobs in Italy," LABOUR, CEIS, vol. 22(s1), pages 147-174, 06.
  5. César Alonso-Borrego & Jesús Fernández-Villaverde & José E. Galdón-Sánchez, 2005. "Evaluating Labor Market Reforms: A General Equilibrium Approach," NBER Working Papers 11519, National Bureau of Economic Research, Inc.
  6. Bonnal, Liliane & Fougere, Denis & Serandon, Anne, 1997. "Evaluating the Impact of French Employment Policies on Individual Labour Market Histories," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 683-713, October.
  7. van Ours, Jan C & Vodopivec, Milan, 2006. "Shortening the Potential Duration of Unemployment Benefits Does Not Affect the Quality of Post-Unemployment Jobs: Evidence from a Natural Experiment," CEPR Discussion Papers 5741, C.E.P.R. Discussion Papers.
  8. Garibaldi, Pietro & Pacelli, Lia & Borgarello, Andrea, 2003. "Employment Protection Legislation and the Size of Firms," IZA Discussion Papers 787, Institute for the Study of Labor (IZA).
  9. Magnac, Thierry, 2000. "Subsidised Training and Youth Employment: Distinguishing Unobserved Heterogeneity from State Dependence in Labour Market Histories," Economic Journal, Royal Economic Society, vol. 110(466), pages 805-37, October.
  10. Bo E. Honoré & Ekaterini Kyriazidou, 2000. "Panel Data Discrete Choice Models with Lagged Dependent Variables," Econometrica, Econometric Society, vol. 68(4), pages 839-874, July.
  11. Marloes de Graaf-Zijl & Gerard van den Berg & Arjan Heyma, 2011. "Stepping stones for the unemployed: the effect of temporary jobs on the duration until (regular) work," Journal of Population Economics, Springer, vol. 24(1), pages 107-139, January.
  12. Andrew Clark & Fabien Postel-Vinay, 2005. "Job security and job protection," LSE Research Online Documents on Economics 19904, London School of Economics and Political Science, LSE Library.
  13. Phelps, Edmund S, 1972. "The Statistical Theory of Racism and Sexism," American Economic Review, American Economic Association, vol. 62(4), pages 659-61, September.
  14. Fabio Berton & Pietro Garibaldi, 2012. "Workers and Firms Sorting into Temporary Jobs," Economic Journal, Royal Economic Society, vol. 122(562), pages F125-F154, 08.
  15. 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.
  16. Bassanini, Andrea & Booth, Alison L. & Brunello, Giorgio & De Paola, Maria & Leuven, Edwin, 2005. "Workplace Training in Europe," IZA Discussion Papers 1640, Institute for the Study of Labor (IZA).
  17. Hagen, Tobias, 2003. "Do Fixed-Term Contracts Increase the Long-Term Employment Opportunities of the Unemployed?," ZEW Discussion Papers 03-49, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  18. Olivier Blanchard & Augustin Landier, 2001. "The Perverse Effects of Partial Labor Market Reform: Fixed Duration Contracts in France," NBER Working Papers 8219, National Bureau of Economic Research, Inc.
  19. Gagliarducci, Stefano, 2005. "The dynamics of repeated temporary jobs," Labour Economics, Elsevier, vol. 12(4), pages 429-448, August.
  20. Bertola, Giuseppe, 1990. "Job security, employment and wages," European Economic Review, Elsevier, vol. 34(4), pages 851-879, June.
  21. Heywood, John S. & Siebert, W. Stanley & Wei, Xiangdong, 2006. "Examining the Determinants of Agency Work: Do Family Friendly Practices Play a Role?," IZA Discussion Papers 2413, Institute for the Study of Labor (IZA).
  22. Antoni Cunyat & Elena Casquel, 2004. "The Dynamics Of Temporary Jobs In Spain," Royal Economic Society Annual Conference 2004 141, Royal Economic Society.
  23. Julie Hotchkiss, 1999. "The effect of transitional employment on search duration: A selectivity approach," Atlantic Economic Journal, International Atlantic Economic Society, vol. 27(1), pages 38-52, March.
  24. D'Addio, Anna Cristina & Rosholm, Michael, 2005. "Exits from temporary jobs in Europe: A competing risks analysis," Labour Economics, Elsevier, vol. 12(4), pages 449-468, August.
  25. Bruno Contini & Francesca Cornaglia & Claudio Malpede & Enrico Rettore, 2002. "Measuring the impact of the Italian CFL programme on the job opportunities for the youths," 10th International Conference on Panel Data, Berlin, July 5-6, 2002 B1-4, International Conferences on Panel Data.
Full references (including those not matched with items on IDEAS)

Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Quanta flessibilità è necessaria?
    by critealdi in Noise from Amerika on 2012-03-15 10:23:36
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Andrea F. Presbitero & Matteo G. Richiardi & Alessia Amighini, 2012. "Is labor flexibility a substitute to offshoring? Evidence from Italian manafacturing," LABORatorio R. Revelli Working Papers Series 122, LABORatorio R. Revelli, Centre for Employment Studies.
  2. Gabriella Berloffa & Francesca Modena & Paola Villa, 2011. "Inequality of opportunity for young people in Italy: Understanding the role of circumstances," Working Papers 241, ECINEQ, Society for the Study of Economic Inequality.
  3. 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).
  4. Bruno Contini, 2010. "Youth Employment in Europe: Institutions and Social Capital Explain Better than Mainstream Economics," LABORatorio R. Revelli Working Papers Series 102, LABORatorio R. Revelli, Centre for Employment Studies.
  5. Bruno, Giovanni S. F. & Caroleo, Floro Ernesto & Dessy, Orietta, 2013. "Temporary Contracts and Young Workers' Job Satisfaction in Italy," IZA Discussion Papers 7716, Institute for the Study of Labor (IZA).
  6. Stefano Sacchi & Patrik Vesan, 2011. "Interpreting employment policy change in Italy since the 1990s: nature and dynamics," Carlo Alberto Notebooks 228, Collegio Carlo Alberto.
  7. Francesco Chelli & Chiara Gigliarano, 2012. "An Analysis of the Italian Labour Market based on Compulsory Communications Data," Rivista di statistica ufficiale, ISTAT - Italian National Institute of Statistics - (Rome, ITALY), vol. 14(2-3), pages 5-17.
  8. Lorenzo Cappellari & Carlo Dell’Aringa & Marco Leonardi, 2012. "Temporary Employment in Italy," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 10(1), pages 55-62, 04.
  9. Bruno Contini, 2012. "Youth employment in Europe: do institutions and social capital explain better than mainstream economics?," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 9(2), pages 247-277, August.
  10. Isabella David, 2009. "Composition Bias and Italian Wage Rigidities over the Business Cycle," LABORatorio R. Revelli Working Papers Series 92, LABORatorio R. Revelli, Centre for Employment Studies.
  11. Tealdi, Cristina, 2011. "Typical and atypical employment contracts: the case of Italy," MPRA Paper 39456, University Library of Munich, Germany.
  12. Matteo PICCHIO & Stefano STAFFOLANI, 2013. "Does Apprenticeship Improve Job Opportunities? A Regression Discontinuity Approach," Working Papers 393, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:tur:wpaper:6. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Simone Pellegrino).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.