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Does the Sector Experience Affect the Pay Gap for Temporary Agency Workers?

  • Jahn, Elke

    ()

    (Department of Economics, Aarhus School of Business)

  • Pozzoli, Dario

    ()

    (Department of Economics, Aarhus School of Business)

It is a well-known fact that temporary agency workers have to accept high pay penalties. However, remarkably little is known about the remuneration of workers who are frequently employed in this sector or who are employed for a substantial length of time. Based on a rich administrative data set, we estimate the e ects of the intensity of agency employment on the temp wage gap and post-temp earnings in Germany. Using a two-stage selection-corrected method in a panel data framework, we show that the wage gap for temps with low treatment intensity is high but decreases with exposure to the sector. It seems that temps are able to accumulate human capital while being employed in this sector. Temps who move to permanent jobs have to accept a sizeable wage disadvantage at rst, indicating that temporary agency employment might stigmatise workers. However, agency employment does not seem to leave a long-lasting scar.

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File URL: http://www.hha.dk/nat/wper/11-09_eljadpoz.pdf
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Paper provided by University of Aarhus, Aarhus School of Business, Department of Economics in its series Working Papers with number 11-9.

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Length: 42 pages
Date of creation: 01 Jan 2011
Date of revision:
Handle: RePEc:hhs:aareco:2011_009
Contact details of provider: Postal: The Aarhus School of Business, Prismet, Silkeborgvej 2, DK 8000 Aarhus C, Denmark
Phone: +45 89 486396
Fax: +45 8615 5175
Web page: http://www.asb.dk/departments/nat.aspx

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  1. Dorner, Matthias & Heining, Jörg & Jacobebbinghaus, Peter & Seth, Stefan, 2010. "Sample of Integrated Labour Market Biographies (SIAB) 1975-2008," FDZ Datenreport. Documentation on Labour Market Data 201001_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
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  19. 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.
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  22. Addison, John T. & Cotti, Chad & Surfield, Christopher J., 2009. "Atypical Work: Who Gets It, and Where Does It Lead? Some U.S. Evidence Using the NLSY79," IZA Discussion Papers 4444, Institute for the Study of Labor (IZA).
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