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More insecure and less paid? The effect of perceived job insecurity on wage distribution

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  • Sergio Scicchitano
  • Marco Biagetti
  • Antonio Chirumbolo

Abstract

This article employs a Counterfactual Decomposition Analysis (CDA) using both a semi-parametric and a non-parametric method to examine the pay gap, over the entire wage distribution, between secure and insecure workers on the basis of perceived job insecurity. Using the 2015 INAPP Survey on Quality of Work, our results exhibit a mirror J-shaped pattern in the pay gap, with a significant sticky floor effect, i.e. the job insecurity more relevant at the lowest quantiles. This pattern is mainly due to the characteristics effect, while the relative incidence of the coefficient component accounts roughly for 22 up to 36% of the total difference, being more relevant at the bottom of the wage distribution.

Suggested Citation

  • Sergio Scicchitano & Marco Biagetti & Antonio Chirumbolo, 2019. "More insecure and less paid? The effect of perceived job insecurity on wage distribution," Working Papers 0041, ASTRIL - Associazione Studi e Ricerche Interdisciplinari sul Lavoro.
    • Handle: RePEc:ast:wpaper:0041
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    1. Fortin, Nicole & Lemieux, Thomas & Firpo, Sergio, 2011. "Decomposition Methods in Economics," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 1, pages 1-102, Elsevier.
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    9. Duncan Gallie & Alan Felstead & Francis Green & Hande Inanc, 2017. "The hidden face of job insecurity," Work, Employment & Society, British Sociological Association, vol. 31(1), pages 36-53, February.
    10. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
    11. Brendan Burchell, 2009. "Flexicurity as a moderator of the relationship between job insecurity and psychological well-being," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 2(3), pages 365-378.
    12. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    13. Laura Helbling & Shireen Kanji, 2018. "Job Insecurity: Differential Effects of Subjective and Objective Measures on Life Satisfaction Trajectories of Workers Aged 27–30 in Germany," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 137(3), pages 1145-1162, June.
    14. Koutentakis, Franciscos, 2008. "The effect of temporary contracts on job security of permanent workers," Economics Letters, Elsevier, vol. 101(3), pages 220-222, December.
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    Cited by:

    1. Sergio Scicchitano, 2018. "Commenti," PRISMA Economia - Societ? - Lavoro, FrancoAngeli Editore, vol. 2018(1-2), pages 119-123.
    2. Juan A. & Francisco Lagos & Ana I. Moro-Egido, 2022. "Job Insecurity during the COVID-19 Pandemic in Spain," ThE Papers 22/10, Department of Economic Theory and Economic History of the University of Granada..
    3. Luca Bonacini & Giovanni Gallo & Sergio Scicchitano, 2021. "Working from home and income inequality: risks of a ‘new normal’ with COVID-19," Journal of Population Economics, Springer;European Society for Population Economics, vol. 34(1), pages 303-360, January.
    4. Esposito, Piero & Scicchitano, Sergio, 2022. "Educational mismatch and labour market transitions in Italy: Is there an unemployment trap?," Structural Change and Economic Dynamics, Elsevier, vol. 61(C), pages 138-155.
    5. Mauro Caselli & Andrea Fracasso & Arianna Marcolin & Sergio Scicchitano, 2023. "The reassuring effect of firms' technological innovations on workers' job insecurity," International Journal of Manpower, Emerald Group Publishing Limited, vol. 45(4), pages 754-778, October.
    6. Silvia Vannutelli & Sergio Scicchitano & Marco Biagetti, 2022. "Routine-biased technological change and wage inequality: do workers’ perceptions matter?," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(3), pages 409-450, September.
    7. Antonio Chirumbolo & Antonino Callea & Flavio Urbini, 2022. "Living in Liquid Times: The Relationships among Job Insecurity, Life Uncertainty, and Psychosocial Well-Being," IJERPH, MDPI, vol. 19(22), pages 1-20, November.
    8. Antonio Chirumbolo & Antonino Callea & Flavio Urbini, 2021. "The Effect of Job Insecurity and Life Uncertainty on Everyday Consumptions and Broader Life Projects during COVID-19 Pandemic," IJERPH, MDPI, vol. 18(10), pages 1-20, May.

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    More about this item

    Keywords

    Job (in)security; Counterfactual distribution; Semi-parametric methodology; Non-parametric methodology; Wage gap; Blinder/Oaxaca; Quantile regression; Italy;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General

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