Économie et Statistique n° 431-432 - 2010Labor, Training and Occupational Skills
Occupational Paths at the Start of a Working Career: What Is the Impact of Temporary Contracts?
The impact of labour-market flexibility on young people’s school-to-work transition remains a controversial issue. Holding a temporary job offers the opportunity to acquire workplace experience and may act as a “springboard” towards stable employment, but there is a risk of finding oneself in a “dead end”. Our study therefore seeks to provide some empirical answers to these questions by examining the transitions between temporary employment, stable employment, and non-employment at the start of a working career. For this purpose, we use the 2003 “Training and Occupational Skills” (Formation et Qualification Professionnelle: FQP) survey, whose calendar supplies a precise description of the paths taken by respondents interviewed over five years. We use a “multi-state multi-episode” model to isolate and measure the respective impact of observed individual characteristics, unobserved heterogeneity, dependence on past and present states (holding a given job may impact future paths), and duration dependence (a long spell in a given state influences the probability of leaving that state) on occupational integration processes. The estimates show the strong influence of individual characteristics on transitions. They also show that experiencing a given labour-market status may have a long-term effect on an occupational path. Holding a temporary job at the start of one’s career may therefore have an incidence over the longer run. More specifically, temporary work leads to non-employment (unemployment and inactivity) more often than to stable employment. However, transitions to stable employment move in a non-linear pattern in step with the time spent in a temporary job. Unobserved individual characteristics appear to have little impact for men and a greater impact for women.