IDEAS home Printed from https://ideas.repec.org/p/fda/fdaeee/eee2024-25.html
   My bibliography  Save this paper

Employment Protection by Job Retention Schemes in a Segmented Labor Market

Author

Listed:
  • Raquel Carrasco
  • Virginia Hernanz
  • Juan Francisco Jimeno

Abstract

This article examines the effects of Job Retention Schemes (JRS) on the employment status and wages of permanent and temporary workers in the short and medium term during the COVID-19 crisis in Spain. Traditionally, labour market adjustments in Spain have relied on changes in temporary employment, while permanent workers have enjoyed greater job stability due to strict firing regulations. The main policy response to the COVID-19 crisis was the extension of JRS across sectors, occupations, and, for the first time, to temporary workers. Using data from administrative records, the analysis reveals that, while the protection offered by JRS did not entirely bridge the gap with permanent workers, it did provide temporary workers with higher employment probabilities and wage gains after the crisis compared to similar workers pushed into unemployment.

Suggested Citation

  • Raquel Carrasco & Virginia Hernanz & Juan Francisco Jimeno, 2024. "Employment Protection by Job Retention Schemes in a Segmented Labor Market," Studies on the Spanish Economy eee2024-25, FEDEA.
    • Handle: RePEc:fda:fdaeee:eee2024-25
    as

    Download full text from publisher

    File URL: https://documentos.fedea.net/pubs/eee/2024/eee2024-25.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Tito Boeri & Herbert Bruecker, 2011. "Short-time work benefits revisited: some lessons from the Great Recession [‘Reversed roles? Wage and employment effects of the current crisis’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 26(68), pages 697-765.
    2. Guell, Maia & Petrongolo, Barbara, 2007. "How binding are legal limits? Transitions from temporary to permanent work in Spain," Labour Economics, Elsevier, vol. 14(2), pages 153-183, April.
    3. repec:osf:socarx:p2qvh_v1 is not listed on IDEAS
    4. Kato, Takao & Kodama, Naomi, 2019. "The Consequences of Short-Time Compensation: Evidence from Japan," IZA Discussion Papers 12596, Institute of Labor Economics (IZA).
    5. Tito Boeri & Pierre Cahuc, 2023. "Labor Market Insurance Policies in the Twenty-First Century," Annual Review of Economics, Annual Reviews, vol. 15(1), pages 1-22, September.
    6. Carrillo-Tudela, Carlos & Clymo, Alex & Comunello, Camila & Jäckle, Annette & Visschers, Ludo & Zentler-Munro, David, 2023. "Search and reallocation in the COVID-19 pandemic: Evidence from the UK," Labour Economics, Elsevier, vol. 81(C).
    7. María A.Davia & Virginia Hernanz, 2004. "Temporary employment and segmentation in the Spanish labour market: An empirical analysis through the study of wage differentials," Spanish Economic Review, Springer;Spanish Economic Association, vol. 6(4), pages 291-318, December.
    8. repec:bla:ecpoli:v:26:y:2011:i:68:p:697-765 is not listed on IDEAS
    9. repec:oup:ecpoli:v:26:y:2011:i:68:p:697-765 is not listed on IDEAS
    10. Samuel Bentolila & Juan J. Dolado, 1994. "Labour Flexibility and Wages: Lessons from Spain," Working Papers wp1994_9406, CEMFI.
    11. Guido Matias Cortes & Eliza Forsythe, 2023. "Heterogeneous Labor Market Impacts of the COVID-19 Pandemic," ILR Review, Cornell University, ILR School, vol. 76(1), pages 30-55, January.
    12. Luis Cárdenas & Paloma Villanueva, 2021. "Flexibilization at the Core to Reduce Labour Market Dualism: Evidence from the Spanish Case," British Journal of Industrial Relations, London School of Economics, vol. 59(1), pages 214-235, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. J. Ignacio Conde-Ruiz & Jorge Fernández Orellana & Manu García & Daniel Pérez Gutiérrez, 2025. "Protección Laboral en un Mercado Dual: Lecciones de una Pandemia," Studies on the Spanish Economy eee2025-18, FEDEA.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cahuc, Pierre, 2024. "The micro and macro economics of short-time work," Handbook of Labor Economics,, Elsevier.
    2. Samuel Bentolila & Juan Jose Dolado & Juan F. Jimeno, 2008. "Two-tier Employment Protection Reforms: The Spanish Experience," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 6(4), pages 49-56, December.
    3. Fernández-Kranz, Daniel & Rodríguez-Planas, Núria, 2011. "The part-time pay penalty in a segmented labor market," Labour Economics, Elsevier, vol. 18(5), pages 591-606, October.
    4. Effrosnyi Adamopoulou & Luis Diez-Catalan & Ernesto Villanueva, "undated". "Staggered Contracts and Unemployment During Recessions," CRC TR 224 Discussion Paper Series crctr224_2022_379, University of Bonn and University of Mannheim, Germany.
    5. Olga Kuzmina, 2023. "Employment Flexibility and Capital Structure: Evidence from a Natural Experiment," Management Science, INFORMS, vol. 69(9), pages 4992-5017, September.
    6. Garcia-Louzao, Jose & Hospido, Laura & Ruggieri, Alessandro, 2023. "Dual returns to experience," Labour Economics, Elsevier, vol. 80(C).
    7. Paul, Marie & Fernandez-Kranz, Daniel & Rodriguez-Planas, Nuria, 2014. "The Wage Effects of Fixed-term Contract Employment Revisited: an Investigation Based on Social Security Records," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100324, Verein für Socialpolitik / German Economic Association.
    8. Ignacio García Pérez, J. & Osuna, Victoria, 2014. "Dual labour markets and the tenure distribution: Reducing severance pay or introducing a single contract," Labour Economics, Elsevier, vol. 29(C), pages 1-13.
    9. Blanas, Sotiris & Oikonomou, Rigas, 2023. "COVID-induced economic uncertainty, tasks and occupational demand," Labour Economics, Elsevier, vol. 81(C).
    10. Guell, Maia & Petrongolo, Barbara, 2007. "How binding are legal limits? Transitions from temporary to permanent work in Spain," Labour Economics, Elsevier, vol. 14(2), pages 153-183, April.
    11. Tai Lee, 2022. "The Impact of Employment Protection on the Probability of Job Separation: Evidence from Job Duration Data in South Korea," Journal of Labor Research, Springer, vol. 43(3), pages 369-414, December.
    12. Diego Daruich & Sabrina Di Addario & Raffaele Saggio, 2023. "The Effects of Partial Employment Protection Reforms: Evidence from Italy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(6), pages 2880-2942.
    13. Cahuc, Pierre, 2024. "The Micro and Macro Economics of Short-Time Work," CEPR Discussion Papers 19429, C.E.P.R. Discussion Papers.
    14. Victoria Osuna & J. García-Pérez, 2015. "On the Effectiveness of Short-time Work Schemes in Dual Labor Markets," De Economist, Springer, vol. 163(3), pages 323-351, September.
    15. Victoria Osuna & José Ignacio García Pérez, 2021. "Temporary layoffs, short-time work and COVID-19: the case of a dual labour market," Applied Economic Analysis, Emerald Group Publishing Limited, vol. 30(90), pages 248-262, December.
    16. Bentolila, Samuel & Dolado, Juan J. & Jimeno, Juan F., 2019. "Dual Labour Markets Revisited," IZA Discussion Papers 12126, Institute of Labor Economics (IZA).
    17. Francesconi, Marco & Sonedda, Daniela, 2024. "Does Weaker Employment Protection Lower the Cost of Job Loss?," IZA Discussion Papers 17374, Institute of Labor Economics (IZA).
    18. Lochner Benjamin, 2024. "Employment Protection in Dual Labor Markets: Any Amplification of Macroeconomic Shocks?," The B.E. Journal of Macroeconomics, De Gruyter, vol. 24(1), pages 249-304, January.
    19. Cravo, Tulio A. & de Andrade Jacinto, Paulo & Quintana, Rodrigo, 2024. "Can work sharing sustain employment during economic downturn? Evidence from Brazil," Labour Economics, Elsevier, vol. 90(C).
    20. Pizzinelli, Carlo & Shibata, Ippei, 2023. "Has COVID-19 induced labor market mismatch? Evidence from the US and the UK," Labour Economics, Elsevier, vol. 81(C).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fda:fdaeee:eee2024-25. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Carmen Arias (email available below). General contact details of provider: https://www.fedea.net .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.