Temporary layoffs and the duration of unemployment

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractWe use Norwegian micro-data to identify the driving forces behind unemployment spells following temporary-and permanent dismissals. The duration of unemployment spells for permanently dismissed workers is primarily explained by individual resources and economic incentives, while spell-duration for temporary dismissed workers is explained by firm incentives. Higher benefits reduce the employment hazard for permanently-but i ncrease it for temporary dismissed workers. Structural duration dependence is nonparametrically identified and sharply estimated with the aid of lagged hazard rate variation and repeated spells. The employment hazards for both spell-types exhibit positive duration dependence during the first months and negative duration dependence thereafter.

Exits from unemployment: Recall or new job

“…Moreover, worker's productivity decreases with unemployment duration and search strategies are revised towards less recall waiting and more search for a new job as unemployment lengthens. This behaviour justifies the finding of significant differences between the effects of the explanatory variables on the recall hazard rate and the new job hazard rate (Katz, 1986;Jensen and Westergärd-Nielsen, 1990;Corak, 1996;Jensen and Nielsen, 1999;Røed and Nordberg, 2003;Rosholm and Svarer, 2001). …”

“…218). As regards Europe, 2 temporary layoff unemployment has been recognised as an integral part of the Danish (Jensen and Westergärd-Nielsen, 1990), the Austrian (Winter-Ebmer, 1998), the German (Mavromaras and Orme, 2004), and the Norwegian labour markets (Røed and Nordberg, 2003).…”

Re-employment probabilities of unemployment benefit recipients

“…This type of model is common in the analysis of temporary lay-offs where all the unemployed are subject to the competing risks of a recall and a new job (Katz, 1986;Røed and Nordberg, 2003;Alba et al, 2007). To model the transition from unemployment to employment through recall or a different employer, we define the discrete hazard rate with competing …”

“…2 A better understanding of the recall behaviour is important for labour market policy and measures addressing joblessness. Many studies have stressed that individual transitions out of unemployment depend on the extent to which recall by the previous employer is expected (Jensen and Westerga˚rd-Nielsen, 1990;Corak, 1996;Rosholm and Svarer, 2001;Jensen and Svarer, 2003;Røed and Nordberg, 2003). In Spain, research on unemployment duration has exclusively focused on the generosity of the UCS without distinguishing recalls from new job hazards (Alba, 1999;Bover et al, 2002;Gonzalo, 2002;Jenkins and Garcı´a-Serrano, 2004;Arranz and Muro, 2007;Arranz et al, 2009).…”

“…For this reason, UA recipients are expected to have a weaker attachment to their former employer. By distinguishing between UI and UA and between recall and new job exits from unemployment, we make a novel contribution to the literature because previous research on recall duration has not distinguished between the two types of benefits (Røed and Nordberg, 2003;Alba et al, 2007;Fallick and Ryu, 2007).…”