Labour market transitions in Europe - a multilevel analysis of age cohorts and institutions across 13 countries

This report serves the following purposes. First it provides an overview of the major labour market transitions across 13 European countries using monthly data of individual transitions over a period of eight years (1994-2001). Secondly, it investigates how these labour market transitions relate to people’s life-course by identifying different age cohorts. Finally, the study investigates to what extent cross-national differences in labour market transitions can be explained by institutional arrangements, namely the Unemployment Replacement Rate (URR), employment protection legislation (EPL) and labour market policies (LMPs). By doing so, the report contributes to Work Package 6 [WP 6: Labour Relations and modes of employment] of NEUJOBS as it shows how labour market models affect individual behaviour in the labour market. Furthermore, the empirical part of this report is based on a new data set that was compiled in an earlier stage of the WP. The research results provide policy relevant information about the sustainability of labour market institutions and the extent to which they produce intended and unintended outcomes. This is for example illustrated by the differences between countries regarding the transition from employment to retirement. While in Luxembourg, France and the United Kingdom this transitions marks the end of one’s career, it is not uncommon in countries like Finland, Portugal and Denmark that people retire and return to employment. Furthermore, the relative low inflow from education into employment in countries like Spain and Greece may be partly due to their relatively high levels of employment protection legislation (EPL), which is unlikely to be intended. And, finally it shows that the labour market institutions investigated here do not have an impact on transitions from employment to employment, and therefore do not produce the outcomes for which they are intended (neither stability nor flexibility).

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