The long-lasting scar of bad jobs in the Spanish labour market
Ainhoa Osés Arranz, ISEAK
Most young Spaniards start their working lives with low wages and highly unstable jobs. Many of them progressively improve their working conditions and move towards better jobs. Yet a relevant fraction get trapped into those low-quality jobs. We refer to this phenomenon as the scar of bad jobs. The purpose of this paper is to analyse the extent and nature of the scar, which helps learn about the hysteresis of bad jobs in Spain. To do so, we use longitudinal administrative records and compute an index to measure the quality of jobs. This is constructed by combining data on labour earnings, number of hours worked and employment rotation. By observing individuals not only at the start of their career, but also five and ten years later, we find that a bad job at the beginning is an important predictor of a bad job five years after, particularly if a bad job stems from working few hours. Additionally, those who escape from bad jobs in the first five years are unlikely to be trapped into them in the long run. Interestingly, the depth of the scar varies along the economic cycle. In particular, the Great Recession severely impacted the future careers of entrants, compared to the pre-crisis workers. Lastly, we identify that women, younger entrants and hospitality workers are more prone to hold their bad jobs in the medium and long term, and hence to be relegated to the lower tail of the income distribution.
About the speaker:
Ainhoa Osés Arranz is a Researcher at ISEAK. Her research focuses on labour economics, with a particular insterest in labour precariousness and the future of work. She is also a PhD student in Economics at the University of the Basque Country, and she is currently undertaking a research stay at the OECD’s Directorate for Employment Labour and Social Affairs in Paris. Ainhoa has over 3 years’ experience in fiscal policy, first as a Research Assistant at the Spanish Independent Authority for Fiscal Responsibility (AIReF) in Madrid and later as an Economist in its Irish counterpart, the Irish Fiscal Advisory Council. Ainhoa holds a Bachelor’s degree in Economics from the University of the Basque Country, where she received the extraordinary prize in Economics, and she also holds a Master in Economics from Universidad Carlos III de Madrid in 2016.