Job Security Legislation and Job Duration: Evidence from the United Kingdom
Even in countries with high average job security, workers with low tenure typically enjoy very limited job protection. This study analyzes the impact of such a feature on job duration. It uses a 1999 British reform that increased job security for workers with 1-2 years of tenure. The firing hazard for these workers decreased by 26% relative to the hazard for workers with 2-4 years of tenure. The firing hazard for workers with 0-1 year of tenure also decreased by 19%, which is consistent with better recruitment practices and hence improved match quality. (c) 2009 by The University of Chicago.
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