Quit behavior and the role of job protection

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. www.econstor.eu The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. Job protection reduces job turnover by changing firms' hiring and firing decisions. Yet the effect of job protection on workers' quit decisions and post-quit outcomes is still unknown. We present the first evidence using individual panel data from 12 European countries, which differ both in worker turnover rates and in the level of job protection. We find that workers are less likely to quit their job in countries with more job protection, but conditional on quitting they receive higher wages. This evidence can be explained by increased mobility costs associated with higher expected risk of post-quit layoff and job mismatch.JEL Classification: J28, J62

Protección del empleo y flujos del mercado de trabajo en España: Efectos de las reformas de 2010 y 2012

“…También hay evidencia de que aquellos países con menor protección del empleo presentan no solo tasas de despido más altas, sino tasas de salidas voluntarias también más altas (Gielen y Tatsiramos, 2012).…”

Training in two-tier labor markets: The role of job match quality

“…Moreover, a lack of job protection may also cause lower job satisfaction among temporary employees, leading to higher quit rates. Evidence points out that employment protection decreases quits (Gielen and Tatsiramos, 2012).…”

“…11 For that reason we follow several studies (e.g. Clark, 2001;Ferreira and Taylor, 2011;Gielen and Tatsiramos, 2012) that measure the quality of the job match using information on job satisfaction. The intuitive basis of using job satisfaction as a measure for match quality can be traced back to Freeman (1978), who makes the argument that job satisfaction reduces disutility of work and improves productivity.…”

OECD Skills Strategy Diagnostic Report: Spain 2015

“…For workers, strict EPL increases the risk associated with job changes, with the result being higher wage demands when changing jobs and decreased labour mobility overall (Orsini and Vila Núñez, 2014;Gielen and Tatsiramos, 2012). In the aggregate, the lack of wage flexibility and disincentives for workers to reallocate their labour from declining to growing firms and industries hinders productivity growth and job creation (Orsini andVila Núñez, 2014).…”