Societal implications of labour market instability

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Authors

Eszter Sándor

Gillian Bell

Abstract

This report investigates the social groups whose attachment to the labour market may be unstable and who are most likely to have non-standard working arrangements, and the implications of such arrangements, and job insecurity, for workers’ well-being, social exclusion, trust, perception of fairness and political participation. The report finds that non-permanent contracts, informal work and insecure jobs are associated with negative outcomes when it comes to social exclusion and trust, while job insecurity is additionally associated with poorer well-being. Recent examples of policies addressing labour market instability are also presented, focusing on longer-term measures in the post-pandemic period.

Societal implications of labour market instability PDF

English (735.89 KB - PDF)

Key findings

While short-term temporary contracts have become less common among employees in the past decade, they are still relatively widespread in some Member States, mostly among young people and non-nationals with low levels of education who cannot find a permanent job, particularly in the education and health sectors. Temporary workers often work long hours, feel underemployed and are most likely to be looking for other jobs.
Both non-permanent contracts and job insecurity are associated with lower trust in other people and a lower perception of fairness. Workers on a non-permanent contract and workers with no formal contract are less satisfied with the functioning of democracy in their country, as are people experiencing job insecurity.
People with non-permanent contracts, as well as those experiencing job insecurity, are less likely to vote in elections, even when non-nationals ineligible to vote (who are overrepresented in these categories) are excluded from the analysis. They are also less likely to participate in demonstrations, which is symptomatic of disengagement.
Care responsibilities are the main reason for part-time work, with women nearly three times as likely to work part time as men, and the difference is even larger between those who are parents and those who are not. While involuntary part-time work has been on the decline since the Great Recession years, part-time workers are more willing to work additional hours and are more likely to look for another job than full-time workers, reinforcing previous findings that some ‘voluntary’ part-time work is done out of necessity.
While fixed-term contracts were not found to be associated with well-being, perceived job insecurity is however associated with lower life satisfaction, poorer health and mental well-being, and a greater likelihood of feeling excluded from society. The association between social exclusion and job insecurity is similar to the relationship between social exclusion and unemployment, suggesting that the threat of unemployment is enough to make workers feel excluded from society.

Executive summary

Author(s):

Eurofound

Societal implications of labour market instability

English (54.75 KB - PDF)

The report contains the following lists of tables and figures.

List of tables

Table 1: Negative feelings and risk of depression, by employment status and contract type
Table A1: Regression analysis output (multinomial logistic regression) – temporary work
Table A2: Regression analysis output (multinomial logistic regression) – part-time work
Table A3: Regression analysis output (multinomial logistic regression) – self-employment
Table A4: Correspondents who contributed to the study

List of figures

Figure 1: Proportion of employees in temporary work in the EU, by duration of contract (%)
Figure 2: Temporary work as a proportion of total employment, by reason, EU27, 2013–2021 (%)
Figure 3: Temporary work as a proportion of total employment, by duration of contract, EU27, 2021 (%)
Figure 4: Probability of engaging in temporary work, by relationship status and age (average marginal effect)
Figure 5: Probability of engaging in temporary work, by education and citizenship (average marginal effect)
Figure 6: Probability of engaging in temporary work, by economic activity (NACE Rev. 2) (average marginal effect)
Figure 7: Part-time work as a proportion of total employment, by reason (%)
Figure 8: Part-time work as a proportion of total employment, by sex, EU27, 2013–2021 (%)
Figure 9: Short-time work as a proportion of total employment, by age, EU27, 2013–2021 (%)
Figure 10: Probability of engaging in part-time work, by age and citizenship (average marginal effect)
Figure 11: Probability of engaging in part-time work, by education, sex and presence of children (average marginal effect)
Figure 12: Probability of engaging in part-time work, by economic activity (Nomenclature of Economic Activities Rev. 2) (average marginal effect)
Figure 13: Self-employment without employees as a proportion of total employment, by occupation (%)
Figure 14: Types of employment as a proportion of total employment, EU27, 2013–2021 (%)
Figure 15: Probability of being self-employed, by year and degree of urbanisation (average marginal effect)
Figure 16: Levels of labour market instability across EU Member States
Figure 17: Perceived job insecurity, by working arrangement (%)
Figure 18: Perceived health, by perceived likelihood of losing one’s job in the next six months (%)
Figure 19: Logistic regression model of average marginal effect of selected factors on perceiving health as ‘bad’ or ‘very bad’
Figure 20: Negative feelings and risk of depression, by perceived likelihood of losing one’s job in the next six months (%)
Figure 21: Linear regression model of determinants of mental well-being (on a scale of 0–10)
Figure 22: Logistic regression model of average marginal effect of selected factors on risk of depression
Figure 23: Life satisfaction (on a scale of 1–10), by main activity, 2018
Figure 24: Life satisfaction (on a scale of 1–10), by contract type, 2018
Figure 25: Life satisfaction (on a scale of 1–10), by perceived likelihood of losing one’s job in the next six months
Figure 26: Life satisfaction (on a scale of 1–10), by contract type and employment status
Figure 27: Linear regression model of determinants of life satisfaction (on a scale of 1–10)
Figure 28: Perceived social exclusion, by employment status and perceived likelihood of losing one’s job in the next six months (%)
Figure 29: Logistic regression model of average marginal effect of selected factors on perceived social exclusion
Figure 30: Trust in people (on a scale of 1–10), by main activity, 2018
Figure 31: Trust in people (on a scale of 1–10), by work contract, 2018
Figure 32: Linear regression analysis of determinants of trust in people among those in employment, 2018
Figure 33: Linear regression analysis of determinants of trust in people among those not in employment, 2018
Figure 34: Perception of fairness (on a scale of 0–10), by main activity, 2004–2018
Figure 35: Perception of fairness (on a scale of 0–10), by contract type, 2018
Figure 36: Linear regression analysis of determinants of perception of fairness among those in employment, 2018
Figure 37: Linear regression model of determinants of trust in people, 2022
Figure 38: Satisfaction with the government (on a scale of 0–10), by activity status, 2018
Figure 39: Satisfaction with the government (on a scale of 0–10), by contract type, 2018
Figure 40: Linear regression model of determinants of satisfaction with the government among those outside paid employment, 2018
Figure 41: Linear regression model of determinants of satisfaction with the government among those in employment, 2018
Figure 42: Linear regression model of determinants of trust in the government, 2022
Figure 43: Satisfaction with the functioning of democracy, by activity status, 2018
Figure 44: Satisfaction with the functioning of democracy, by contract type, 2018
Figure 45: Linear regression model of determinants of satisfaction with democracy among those outside employment, 2018
Figure 46: Linear regression model of determinants of satisfaction with democracy among those in employment, 2018
Figure 47: Linear regression model of determinants of satisfaction with the functioning of democracy, 2022
Figure 48: Proportion of people who voted in the last election, by work contract type (%)
Figure 49: Proportion of people who voted in the last election, by activity status, 2018
Figure 50: Proportion of workers who voted in the last election, by contract type, 2018
Figure 51: Logistic regression model of average marginal effect of selected factors on voting in the last election
Figure 52: Proportion of workers who participated in public demonstrations, by activity status (%)
Figure 53: Logistic regression model of the average marginal effect of selected factors on participation in demonstrations
Figure 54: Target groups of policy measures addressing labour market instability (%)

Figure A1: Temporary work, by occupation in the International Standard Classification of Occupations 2008 (average marginal effect)
Figure A2: Part-time work, by occupation in the International Standard Classification of Occupations 2008 (average marginal effect)

Number of pages: 82

Reference nº: EF23011

ISBN: 978-92-897-2341-1

Catalogue nº: TJ-04-23-771-EN-N

DOI: 10.2806/570695

Permalink: eurofound.link/ef23011

Cite this publication
Eurofound (2023), Societal implications of labour market instability, Publications Office of the European Union, Luxembourg.

Societal implications of labour market instability

Key findings

Societal implications of labour market instability

List of tables

List of figures

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