Working Papers, Department of Economics, Aarhus School of Business, University of Aarhus
Does the Sector Experience Affect the Pay Gap for Temporary Agency Workers?
() and Dario Pozzoli
Abstract: It is a well-known fact that temporary agency workers have
to accept high pay penalties. However, remarkably little is known about the
remuneration of workers who are frequently employed in this sector or who
are employed for a substantial length of time. Based on a rich
administrative data set, we estimate the eects of the intensity of agency
employment on the temp wage gap and post-temp earnings in Germany. Using a
two-stage selection-corrected method in a panel data framework, we show
that the wage gap for temps with low treatment intensity is high but
decreases with exposure to the sector. It seems that temps are able to
accumulate human capital while being employed in this sector. Temps who
move to permanent jobs have to accept a sizeable wage disadvantage at rst,
indicating that temporary agency employment might stigmatise workers.
However, agency employment does not seem to leave a long-lasting scar.
Keywords: Temporary Agency Employment; Treatment Intensity; Dose Response Function Approach; Wages; Germany; (follow links to similar papers)
JEL-Codes: J30; J31; J41; J42; (follow links to similar papers)
42 pages, January 1, 2011
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