temporary work in turbulent times the swedish experience the paper presents the swedish institutional setting documents basic stylised facts about fixedterm contracts and discusses the causes of their increased prevalence open ended and temporary employment exhibit strikingly different cyclical behaviour with temporary employment being more volatile a recession is associated with an initial decline in temporary employment followed by a sharp rise from the trough to the end of the recession we argue that the severe recession of the 1990s is a major factor behind the rise in temporary work in sweden adverse macroeconomic conditions make firms more prone to offer fixed term contracts and workers more willing to accept them in the early 1990s sweden experienced a macroeconomic downturn unparalleled in the post war period gdp fell by 6 from the cyclical peak in the first quarter of 1990 to the trough in the first quarter of 1993 the unemployment rate stood at around 1 5 in 1989 90 and had risen to 8 2 by 1993 the employment topopulation ratio fell over the same period by 10 percentage points signs of a sustained labour market recovery did not appear until the end of the century the period from 1997 and onwards has seen a large decline in unemployment as well as rising employment a rebound triggered by a marked increase in gdp growth by the end of the year 2000 unemployment had fallen to 4 of the labour force an intriguing aspect of the swedish experience is that the entire decline in employment during the downturn was the result of job losses among workers with standard open ended contracts ie those covered by fairly stringent employment protection provisions in contrast employment in fixed term contracts temporary work increased substantially over most of the 1990s by the end of the century fixed term contracts accounted for 16 of total wage and salary employment to be compared with 10 in the early 1990s among the other nordic countries only finland has exhibited a similar growth in fixed term contracts indeed the finnish experience during the 1990s has been even more dramatic than the swedish one with both a greater increase in unemployment and in fixed term contracts the macroeconomic conditions in denmark and norway were generally more favourable with some fall in unemployment interestingly neither of those two countries experienced any significant rise in fixed term contracts the purpose of this paper is to describe and discuss the evolution of fixed term

firm size earnings and displacement risk rudolf winter ebmer analogous to the well documented firm size wage differential there also exists a differential in layoff risk according to firm size using austrian data i discuss several reasons for this puzzle including on the job training and workers heterogeneity if less stable and also less able workers select themselves into small unstable and low paying firms predicted layoff risk of workers can be used as a proxy for heterogeneity of workers and therefore be included in wage regressions doing this one half of the size earnings premium can be explained jel j31 j63 i introduction large employers pay more numerous empirical studies have documented this relationship 1 but they have not been able to explain it in a very careful study brown and medoff 1989 1056 look at ten possible reasons for this puzzle only to conclude our bottom line is that the size wage differential appears to be both sizable and omnipresent our analysis leaves us uncomfortably unable to explain it or at least the part of it that is not explained by observable indicators of labor quality neither compensating differentials for working conditions nor product market power or the threat of unionization were able to explain the size premium brown and medoff 1989 also found size effects for piece rate workers for unionized workers 2 and in longitudinal samples 3 where they controlled by first differencing for unobserved heterogeneity of the individuals given this wide interest in the effects of employer size on earnings very little research has been done concerning size differentials in turnover are the jobs in big firms not only higher paid but also more stable this would reinforce the puzzle of firm size once more anderson and meyer 1994 look at separation rates without distinguishing between quit and layoff and find highly decreasing turnover rates with firm size for permanent separations but no size effect on temporary separations 4 brown and medoff 1989 as well as others find quit rates to decline with firm size which speaks against compensating wage differentials arguments idson 1996 explicitly looks at the issue of long term employment relationships in large establishments which may be possibly due to the greater capacity of large employers to provide job mobility within the enterprise and the lower probability of business failure facing larger firms rebitzer 1986 argues that the observed higher job tenure in large plants is in a ccordance with labor market segmentation theory the aim of this article is to provide further evidence for a size layoff relationship using austrian data i try to consider several explanations for this regularity especially on the job training and the hypothesis of selective recruitment of workers into large and small firms following one hypothesis small employers attract less stable and capable employees a pattern that would cause only a spurious size layoff relationship on the other hand if workers with a relatively low stock of human capital sort themselves into relatively inefficient firms with unstable employment prospects then the size wage effect itself may be upwardly biased which was noted by mayo and murray 1991 the plan of the article is as follows section ii presents institutional details on wage bargaining and employment protection legislation in austria the data for the empirical study are discussed in section iii results for size wage and size layoff relationships are presented in section iv section v looks at the interaction between firm size layoff risk and wage determination section vi concludes ii wage bargaining institutions and job security legislation in austria wage bargaining in austria is very centralized even though only about 60 of workers are organized in unions bargaining outcomes are extended to all workers unionized or not a works council has to be established under the austrian labor law in all establishments employing at least five adult workers but usually the actual existence of a works council is positively determined by both firm size and firm age

lasting or latent scars swedish evidence on the long term effects of job displacement recently improved swedish register data have made it possible to remedy many weaknesses of previous research on displaced workers using linked employer employee data we identify all workers displaced in 1987 due to an establishment closure and follow them over both a predisplacement period of 4 years and a postdisplacement period stretching until 1999 we find that the displaced workers suffer both earnings losses and worsened labor market position not only during a transitory period of adjustment but also in the longer run these longer run effects seem to be driven by an increased sensitivity to subsequent macroeconomic shocks

job loss and regional mobility we study the migration behavior of displaced workers and find that job displacement increases regional mobility we find however that noneconomic factors such as family ties are very important

dispatch planning using newsvendor dual problems and occupation times application to hydropower abstract we consider price driven dispatch planning under price uncertainty a storable commodity is optimally sold and purchased over time first we consider models where the storage level is constrained in expectation the dual of the corresponding optimization problem is related to the newsvendor problem exact solutions of bang bang type are given the second methodology is for high frequency dispatch decisions in multistage stochastic programming models to overcome the curse of dimensionality prices are modeled by occupation times at price levels in a case study we consider a pumped storage hydropower plant numerical solutions are given which have similar patterns as for the first exactly solvable problems

plant level employment development before collective displacements comparing mass layoffs plant closures and bankruptcies this article analyzes the development of employment levels and worker flows before bankruptcies plant closure without bankruptcies and mass layoffs utilizing administrative plant level data for g

the effect of job displacement on couples fertility decisions this paper analyzes the effects of job displacement on fertility using finnish longitudinal register data we focus on couples where one spouse has lost a job due to a plant closure and follow them for several years before and following the job loss the results show that female job loss decreases fertility for every 100 displaced females there are three fewer children born male job loss has no impact on fertility despite resulting in a stronger decrease in family income than female job loss this indicates that the income effect is not the mechanism through which job displacement influences fertility

incentives to cultivate favored minorities under alternative electoral systems a simple model is used to compare under different electoral systems the incentives for candidates to create inequalities among otherwise homogeneous voters by making campaign promises that favor small groups rather than appealing equally to all voters in this game model each candidate generates offers for voters independently out of a distribution that is chosen by the candidate subject only to the constraints that offers must be nonnegative and have mean 1 symmetric equilibria with sincere voting are analyzed for two candidate elections and for multicandidate elections under rank scoring rules approval voting and single transferable vote voting rules that can guarantee representation for minorities in multiseat elections generate in this model the most severely unequal campaign promises

the costs of worker displacement this study identifies part of the social loss attendant upon displacement as the remaining value of the assets specific to the severed employment relationship a bargaining model is used to link wage tenure profiles to the amount of information firms and workers possess about the duration of that relationship if information is good the profile will flatten as displacement approaches using psid data for workers separated between 1977 and 1981 wage tenure profiles are found not to change this suggests that either workers or both firms and workers are surprised by the displacement the present value of that part of the social loss attributable to the worker s share of firm specific capital is around 7 000 1980 dollars

monitoring job offer decisions punishments exit to work and job quality unemployment insurance systems include the monitoring of unemployed workers and punitive sanctions if job search requirements are violated we analyze the causal effect of sanctions on the ensuing job quality notably on wages and occupational level we use swedish data and estimate duration models dealing with selection on unobservables we also develop a theoretical job search model that monitors job offer rejection versus job search effort the empirical results show that after a sanction the wage rate is lower and individuals move more often to a part time job and a lower occupational level incurring human capital losses

displacement and immigrant workers responsiveness to regional labour market opportunities evidence from norway roed m and schone p displacement and immigrant workers responsiveness to regional labour market opportunities evidence from norway regional studies this paper answers two main questions first are immigrants more mobile than natives following job displacement the results show that immigrants are indeed more mobile than natives following job displacement however the difference is fully explained by a compositional effect immigrants have much shorter potential work experience in norway than natives second are immigrants more responsive than natives to differences in regional labour market opportunities following job displacement the results show that displaced western immigrants are more responsive to differences in regional labour market opportunities compared with both non western immigrants and natives the greasing effects are limited to immigrants with low mobility costs

parental job loss and children s school performance using norwegian register data we estimate how children s school performance is affected by their parents exposure to plant closure our estimates suggest that paternal job loss has a negative effect on children s school performance in contrast maternal job loss is associated with a non significant increase in school performance importantly the negative effect of paternal job loss appears largely unrelated to its effect on father s income father s employment status a shift in maternal time towards employment marital dissolution and residential relocation a disparate effect of job loss across fathers and mothers is however consistent with recent empirical studies documenting that the mental distress experienced by displaced workers is generally more severe for men than women

income receipt and mortality evidence from swedish public sector employees in this paper we study the short run effect of salary receipt on mortality among swedish public sector employees by exploiting variation in paydays across work places we completely control for mortality patterns related to for example public holidays and other special days or events coinciding with paydays and for general within month and within week mortality patterns we find a dramatic increase in mortality on the day that salaries arrive the increase is especially pronounced for younger workers and for deaths due to activity related causes such as heart conditions and strokes the effect is entirely driven by an increase in mortality among low income individuals who are more likely to experience liquidity constraints all things considered our results suggest that an increase in general economic activity on salary receipt is an important cause of the excess mortality

does job loss shorten life this paper examines the impact of job loss on overall and cause specific mortality using linked employer employee data we identified the workers displaced due to all establishment closures in sweden in 1987 and 1988 hence we have extended the case study approach which has dominated the plant closure literature the overall mortality risk among men increased by 44 percent during the first four years following job loss while there was no impact on either female overall mortality or in the longer run for both sexes however there was an about twofold short run increase in suicides and alcohol related mortality

the survival and growth of new establishments in sweden 1987 1995 the aim of the study is to examine the survival of new establishments and to identify factors affecting their survival probability and their employment growth this study uses a unique data set on all new establishments that were created in sweden 1987 and 1988 with the exception of the construction industry the results show among others that i new establishments face a high risk of closing down ii the probability of establishment survival increases with the age and size of the establishment iii variables that are assumed to measure access to resources being a part of a multi unit firm and being new due to merger or dispersal have a positive effect on survival iv the number of employees at the start up year has a negative effect on the employment growth and v demographic and educational factors are important in explaining survival and growth

are children really inferior goods evidence from displacement driven income shocks abstract this paper explores the causal link between income and fertility by analyzing women s fertility response to the large and permanent income shock generated by a husband s job displacement i find that the shock reduces total fertility suggesting that the causal effect of income on fertility is positive a model that incorporates the time cost of children and assortative matching of spouses can simultaneously explain this result and the negative cross sectional relationship i also find that a husband s displacement accelerates childbearing which is consistent with lifecycle models of fertility in which the incentive to delay is driven by expected earnings growth

persistence of employment fluctuations a model of recurring job loss standard models of employment fluctuations cannot reconcile the unemployment rate s remarkable persistence with the high job finding rates found in worker flows data a matching model emphasizing high hazard rates among newly formed firm worker matches can resolve this shortcoming in the model matches are experience goods consequently newly employed workers face higher hazard rates following a job loss workers may experience several short lived jobs before finding stable employment at an aggregate level an initial burst of job loss precipitates a steady flow of recurring job loss a simulation shows that this recurring job loss can account for the fact that the unemployment rate remains elevated for as much as 4 or 5 years following an initial jump intuitively the labour market frictions associated with the difficult and time consuming process of matching unemployed workers with appropriate jobs represent an appealing way to enhance conventional dynamic general equilibrium models of economic fluctuations that generally exhibit very little internal propagation of business cycle shocks 1 nevertheless although conventional matching models such as the canonical mortensen and pissarides 1994 model successfully explain many other important features of the labour market they fail to explain the high degree of persistence observed in the u s unemployment rate the primary reason for this failure is that data on labour market flows show that unemployed workers actually find jobs quite quickly therefore following a shock that triggers a burst of job loss the high job finding rate implies that the unemployment rate in these models returns quite rapidly back toward its average level this represents a significant obstacle to the notion that frictions in the labour market account for much of the propagation of business cycle shocks this paper asserts that existing matching models fail to capture an important feature of the labour market that can reconcile the dramatic persistence of the unemployment rate with the evidence of high job finding rates specifically although unemployed workers find jobs quickly the newly found jobs often last only a short time after an initial job loss a worker may experience several short lived jobs before settling into more stable employment this recurring job loss slows the pace at which the unemployment rate returns to its normal level following an adverse shock

losing heart the effect of job displacement on health job reallocation is considered a key characteristic of well functioning labor markets as more productive firms grow and less productive ones contract or close despite its potential benefits for t

job loss firm level heterogeneity and mortality evidence from administrative data this paper estimates the effect of job loss on mortality for older male workers with a strong labor force attachment using dutch administrative data we find that job loss due to firm closure increased the probability of death within five years by a sizable 0 60 percentage points importantly this effect is estimated using a model that controls for firm level worker characteristics such as lagged firm level annual average mortality rates on the mechanism driving the effect of job loss on mortality we provide evidence for an effect running through stress and changes in life style

the income losses of displaced workers abstract we use a new matched worker firm dataset for the united kingdom to estimate the income loss resulting from firm closure and mass layoffs we track workers for up to nine years after the displacement event and the availability of predisplacement characteristics allows us to implement difference in differences estimators using propensity score matching methods income losses during the first five years after the displacement event are in the range 18 35 percent per year for workers whose firm closes down and 14 25 percent for workers who exit a firm which suffers a mass layoff these losses are largely due to periods of nonemployment which is consistent with previous work from europe but contrasts with that from the united states

returning to work regional determinants of re employment after major redundancies abstractusing matched employer employee data on roughly 429 000 workers made redundant from large plant closures or major downsizing in sweden between 1990 and 2005 this paper analyses the role of the regional industry mix specialization related and unrelated variety in the likelihood of returning to work the results show that a high presence of same or related industries speeds up the re employment process while high concentrations of unrelated activities do not the role of related activities is particularly evident in the short run and in regions with high unemployment consequently the prospect of successful diversification is enhanced in regions with related industries

unemployment and subsequent earnings estimating scarring among british men 1984 94 this paper estimates the impact of unemployment on earnings following re employment for a large and representative sample of british men 1984 94 unemployment incidence is found to have only a temporary effect an average earnings setback of 10 on initial re engagement largely eroding over two years the effect of unemployment duration by contrast is permanent a one year spell adding a further penalty of 10 percentage points these wage penalties are least for young men and the low paid those most at risk of unemployment and greatest for prime age and highly paid men

can immigrants insure against shocks as well as the native born we examine the impact of job displacement and serious health problems on multiple measures of individual and household well being using longitudinal data we extend the previous literature by exami

income after job loss the role of the family and the welfare state that displaced workers suffer long lasting earnings losses is a stylized fact raising the question whether these losses are replaced by other means for married men increased labour supply by the wife may be one way another possibility is that the public welfare system offsets the same losses i used a swedish longitudinal data set containing married couples where the husband was either employed or made redundant in 1987 by an establishment closure there was no evidence that husbands job loss positively affected wives annual earnings although husbands utilization of unemployment insurance increased significantly government transfers including also sickness insurance disability insurance and means tested social benefits did not fully replace husbands long run earnings losses hence displaced workers seem to suffer also from long lasting losses in family income which in many respects is a better measure of economic welfare than individual earnings or wages

are workers permanently scarred by job displacements this paper investigates whether workers suffer lasting scars following job displacements using david t ellwood s 1982 terminology scars represent persistent effects whereas blemishes are transitory adjustments which dissipate over time more precisely dislocated individuals are defined as scarred if they continue to earn less or to be unemployed more than their nondisplaced counterparts even after the conclusion of a several year adjustment period