Increasing employment instability among young people? Labor market entries and early careers in Germany since the mid-1980s

Abstract

´"In the light of rising economic uncertainty, employers increasingly try to transfer market risks to their employees and to establish more flexible employment relationships. Young people are supposed to be especially exposed to labor market flexibilization as the lack of seniority, work experience, lobby, and networks make it possible to shift precarious employment forms to them. In our paper, we investigate whether employment instabilities are indeed rising among young people in Germany and whether certain groups of young people are at a particularly high risk. Our analyses are based on data from the German Socio-Economic Panel (GSOEP) and refer to the period since the mid-1980s; they include young people from Eastern and Western Germany as well as migrants of three different educational cohorts. To capture employment instabilities among young people in Germany, we focus (1) on the duration of first job search, (2) on the risk of fixed-term employment in the first job, (3) on the risk of unemployment after having entered first employment, and (4) the re-entry chances of unemployed persons. Our analyses show that young people face increasing difficulties at labor market entry in recent years: it takes them a longer time to find a first job; a rising share of them is confronted with unemployment directly after leaving the educational system; and starting the employment career in a fixed-term contract is more frequent nowadays. We find growing employment turbulence also in the early career: unemployment risks have been rising for those who have already found a job. Flexible forms of employment (fixed-term positions) seem to be particularly at risk to end in unemployment. Furthermore, it has become more difficult to reenter employment after a phase of unemployment. Employment instabilities do not hit all employees alike, but especially the lowly educated and the lower occupational classes as well as East Germans and migrants. The results indicate that qualification and class became increasingly important for young people's labor market chances since the mid-1980s. We thus find a relative strengthening of inequality structures among young people in Germany in an era of increasing labor market problems." (author's abstract)