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The Structure of the Permanent Job Wage Premium: Evidence from Europe

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  • Lawrence Kahn

Abstract

Using longitudinal data on individuals from the European Community Household Panel for thirteen countries during 1995-2001, I investigate the wage premium for permanent jobs relative to temporary jobs. For men, the wage premium for a permanent job is lower for older workers and native born workers, the latter effect being especially strong relative to those born outside the EU; for women, the permanent job wage premium is lower for older workers and those with longer job tenure. These findings suggest that the gain to employment in permanent jobs is higher for those with less experience in the domestic labor market.

Suggested Citation

  • Lawrence Kahn, 2013. "The Structure of the Permanent Job Wage Premium: Evidence from Europe," CESifo Working Paper Series 4538, CESifo.
    • Handle: RePEc:ces:ceswps:_4538
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    Cited by:

    1. Lawrence M. Kahn, 2018. "Permanent Jobs, Employment Protection, and Job Content," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 57(3), pages 469-538, July.
    2. Ramskogler, Paul, 2021. "Labour market hierarchies and the macro-economy – Do labour market dualities affect wage growth in Europe?," Structural Change and Economic Dynamics, Elsevier, vol. 56(C), pages 154-165.
    3. Lehner, Lukas & Ramskogler, Paul & Riedl, Aleksandra, 2022. "Begging thy coworker – Labor market dualization and the slow-down of wage growth in Europe," INET Oxford Working Papers 2022-04, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford.
    4. 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.
    5. Klinker, Iris & ter Weel, Bas, 2024. "Wages and Employment in the Netherlands, 2017-2023," IZA Discussion Papers 17049, Institute of Labor Economics (IZA).
    6. Cindy Biesenbeek & Maikel Volkerink, 2023. "The price of flexible jobs: Wage differentials between permanent and flexible jobs in The Netherlands," Working Papers 779, DNB.
    7. Sophia Fauser & Michael Gebel, 2023. "Labour Market Dualism and the Heterogeneous Wage Gap for Temporary Employment. A Multilevel Study across 30 Countries," LIS Working papers 853, LIS Cross-National Data Center in Luxembourg.
    8. Per Skedinger, 2018. "Non-standard Employment in Sweden," De Economist, Springer, vol. 166(4), pages 433-454, December.
    9. Garcia-Louzao, Jose & Hospido, Laura & Ruggieri, Alessandro, 2023. "Dual returns to experience," Labour Economics, Elsevier, vol. 80(C).
    10. 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.
    11. Inga Laß & Mark Wooden, 2020. "Temporary Employment Contracts and Household Income," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 147(1), pages 111-132, January.
    12. Inga Laß & Thomas Skora & Heiko Rüger & Mark Wooden & Martin Bujard, 2024. "Does temporary employment increase length of commuting? Longitudinal evidence from Australia and Germany," Transportation, Springer, vol. 51(4), pages 1467-1491, August.
    13. Silva, António Dias da & Turrini, Alessandro, 2015. "Precarious and Less Well Paid? Wage Differences between Permanent and Fixed-term Contracts across the EU," IZA Policy Papers 105, Institute of Labor Economics (IZA).
    14. Maurizio, Roxana., 2016. "Non-standard forms of employment in Latin America : prevalence, characteristics and impacts on wages," ILO Working Papers 994906973402676, International Labour Organization.
    15. Duman, Anil, 2020. "Non-Standard Employment and Wage Differences across Gender: a quantile regression approach," GLO Discussion Paper Series 664, Global Labor Organization (GLO).
    16. Albanese, Andrea & Gallo, Giovanni, 2020. "Buy flexible, pay more: The role of temporary contracts on wage inequality," Labour Economics, Elsevier, vol. 64(C).
    17. Iga Magda & Monika Potoczna, 2014. "Does flexible employment pay? European evidence on the wage perspectives of female workers," IBS Working Papers 3/2014, Instytut Badan Strukturalnych.
    18. Iris Klinker & Bas Weel, 2024. "Wages and Employment in the Netherlands, 2017–2023," De Economist, Springer, vol. 172(3), pages 233-256, September.
    19. Ivan Lagrosa, 2022. "Income dynamics in dual labor markets," Working Papers wp2022_2209, CEMFI.
    20. Satu Ojala & Jouko Nätti & Liudmila Lipiäinen, 2018. "Types of Temporary Employment: An 8-Year Follow-Up of Labour Market Attachment," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 138(1), pages 141-163, July.
    21. Iris Klinker & Bas ter Weel, 2024. "Wages and employment in the Netherlands, 2017-2023," Tinbergen Institute Discussion Papers 24-042/V, Tinbergen Institute.

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    More about this item

    Keywords

    wage structure; segmented labor markets; temporary jobs;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets

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