The role of job interruptions, temporary contracts and multi-firm experiences in the temporality trap in Spain

Abstract

The path to a permanent contract often implies a sequence of temporary jobs, multi-firms experiences and unemployment spells. This paper investigates whether the characteristics of the path may influence the chances to get a permanent contract and the duration itself at the nonpermanent state. We estimate a simple hazard model with unobserved heterogeneity to examine the average duration at the non-permanent position needed to get a permanent one, either in the same or in other firm. The analysis considers two different groups of workers specially affected by temporary contracts. These are the young workers who just enter into the labor market, and the long term unemployed. We find evidence of the existence of the temporality trap. The probability of accessing into a permanent contract is non linearly related to the duration at the non-permanent state. It starts increasing but once it reaches a maximum it drops to pretty low levels. Besides, repeated temporary contracts and job interruptions reduce it while multi-firm experiences seem do not affect it negatively.Temporary employment, temporality trap, Single risk models, Unobserved heterogeneity