The Nineties in Spain: so much Flexibility in the Labor Market?

This paper examines movements into and out of employment in the Spanish labor market throughout the nineties. We analize how differences in personal and economic circumstances influence such movements. In addition, we consider the importance of duration dependence in determining them. Our main findings are that: (i)Young workers, women and those with lower qualification levels are more likely to be affected by high labor turnover; (ii)The existence of unobserved heterogeneity has important consequences in the unemployment hazard rate; (iii)In the 90´s, employment hazard rates were substantially affected by the extensive use of fixed-term contracts, although the 1997 labor market reform seems to have reduced this hazard rate; (iv)The intervention of Temporary Help Agencies has a positive impact on the likelihood of leaving unemployment, although only for short-term unemployed individuals; at the same time, however, the employment hazard rate is substantially higher within these agencies.