Duration Dependence in Employment: Evidence From the Last Half of the 20th Century

This paper extends the investigation of Ignaczak [5] of the first employment spell of workers across five different birth cohorts using pooled data from the 15th and 20th cycles of the Canadian General Social Survey (GSS) to subsequent spells of employment with the purpose of testing for employment duration dependence. As the information on the GSS surveys spans well over the last half of the 20th century we are able to test not only the potential duration dependence but its stability over time. This paper contributes to the debate of employment stability by analyzing the differences between job and employment durations and showing that successive cohorts of workers have had increasingly shorter first employment durations. The analysis finds cohort effects which play a significant role in explaining declining employment tenure. The cohort effects can be seen as a proxy for a number of socio-economic factors that affect the hazard of separation from employment. Separate analysis is completed for men and women by birth cohort. This pattern of declining tenure has occurred for both men and women, but the decline has been far more prominent for men. For men, macroeconomic factors affect the hazard more strongly in more recent cohorts, which is consistent with recessionary periods generating decreasing employment stability across cohorts. For women, cohort effects are consistent with the increasing generosity of maternity leave provisions through Unemployment Insurance.