Marginal employment for welfare recipients: stepping stone or obstacle?

Abstract

Abstract. Marginal employment (ME) is one of the largest forms of atypical employment in Germany. We analyse whether ME has a 'stepping stone' function for unemployed individuals, i.e., whether ME increases the subsequent probability of regular employment. We find differing treatment effects by unemployment duration. According to our results, ME increases the likelihood of regular employment within a 3-year observation period only for those who take up ME several months after beginning to receive benefits. In contrast, for those starting ME within the first months of receiving benefits, there is no effect on the probability of regular employment. Although we took several measures to minimize the impact of unobserved heterogeneity, our results can only be interpreted as causal if the conditional independence assumption holds.

Paper, E-mail, or Both? Effects of Contact Mode on Participation in a Web Survey of Establishments

“… 3. Marginal employment is a type of atypical employment with low earnings up to a threshold of 450 euros per month that are not subject to social security contributions. In the year 2014, about 7.5 million Germans were marginally employed (Lietzmann, Schmelzer, & Wiemers, 2017). …”

Precarious but popular? The German mini-job scheme in comparative research on work and welfare

“…Evaluation studies have generally shown that springboard effects of mini-jobbers are relatively rare even if the characteristics of employees and their working time preferences are taken into account (Brülle, 2013). Nonetheless, a bridging effect seems to exist for some groups such as long-term unemployed (Caliendo, Künn, & Uhlendorff, 2016) or single and childless UB II claimants but only when taking up a mini-job several months after claiming benefits and looking for full-time employment (Lietzmann et al 2017). However, about half of the mini-jobbers on welfare benefits are not looking for another or better-paid job.…”

Do Supplementary Jobs for Welfare Recipients Increase the Chance of Welfare Exit? Evidence from Germany

“…Second, our paper relates to the stepping stone effects literature, which analyzes whether the take-up of certain employment types enhances the chances of subsequent regular employment. More precisely, the existence of stepping stone effects has been investigated (and in most cases also confirmed) for low-wage employment 4 (Uhlendorff 2006, Knabe & Plum 2013, Mosthaf 2014, Cai et al 2018, Boschman et al 2021, for temporary agency work (Kvasnicka 2009, de Graaf-Zijl et al 2011, Gebel 2013, Jahn & Rosholm 2014, for atypical work in general (Auray & Lepage-Saucier 2021), for (subsidized) part-time jobs (Cockx et al 2013, Kyyrä et al 2013, Nightingale 2020) and for marginal employment 5 (Freier & Steiner 2008, Caliendo et al 2016, Lietzmann et al 2017.…”

“…Hence, our results provide information on whether previous findings can be found in a more general setting. Fourth, besides the study of Lietzmann et al (2017), our study is the only one that investigates stepping stone effects in Germany after the Hartz IV reforms.…”