Employment protection legislation and job stability: an European cross country analysis

Cazes, Sandrine and Tonin, Mirco (2009) Employment protection legislation and job stability: an European cross country analysis. Southampton, GB, University of Southampton, 23pp. (Discussion Papers in Economics and Econometrics, 0902).


[img] PDF
Download (203Kb)


This paper tries to shed some light on the actual changes that occurred in the labour markets dynamics of the European Union 253 (EU-25) over the last decade using job tenure4 data. It then investigates the potential role of employment protection legislation (EPL)5 changes in explaining differences in the dynamics of job stability across countries but also across age groups in light of the dual-track reform strategy introduced in Europe during the same period: in most European countries, reforms were made typically at the margin (for new hires), while EPL for the incumbent workers remained unchanged. Thus, if the legislation does not apply uniformly to all workers, the effects of EPL reforms are expected to be disproportionately felt by new entrants, such as the young, women, and possibly immigrants.

The paper opens with a descriptive analysis of job stability measured through job tenure in the EU-25, and its evolution over the last years. The level and structure by age of this indicator is our main empirical material. Data used comes from Labour Force Surveys (EUROSTAT) up to 2006. The analysis shows no generalized decrease in job tenure but a trend towards shorter tenure of young workers (15-24) in most European countries. In a second step, the paper examines the possible explanations behind this trend, focusing on employment protection legislation. An econometric analysis is conducted to test the existence of a link between employment protection and job stability. In particular, we look at the impact of employment protection on average tenure and on the incidence of temporary employment. Finally, some policy recommendations are provided.

Item Type: Monograph (Discussion Paper)
ISSNs: 0966-4246 (electronic)
Related URLs:
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HM Sociology
K Law > K Law (General)
Divisions : University Structure - Pre August 2011 > School of Social Sciences
ePrint ID: 177579
Accepted Date and Publication Date:
February 2009Published
Date Deposited: 17 Mar 2011 15:59
Last Modified: 31 Mar 2016 13:34
URI: http://eprints.soton.ac.uk/id/eprint/177579

Actions (login required)

View Item View Item

Downloads from ePrints over the past year. Other digital versions may also be available to download e.g. from the publisher's website.

View more statistics