Domestic Outsourcing and Worker Outcomes: Evidence from Staffing Firms
with Maarten Goos, Anna Salomons and Bas Scheer
IZA Discussion Paper (link) (and older version: CPB Discussion Paper (link)
The rising incidence of alternative work arrangements, such as outsourcing, raises important questions about worker outcomes in such non-standard labor contracts. We study this question in the Netherlands, a country with a rapid rise in flexible labor contracts, using administrative employer-employee data from 2006--2019. To identify the causal impact of outsourcing, we take advantage of a legal arrangement called "payrolling", where workers hired by one firm are placed on a staffing firm's payroll while maintaining their job duties at the original firm. We find that outsourced workers experience worse labor market outcomes compared to a matched control group. These include persistently lower employment probability, lower hourly wage growth, a lower incidence of permanent contracts, and strikingly reduced pension contributions. This suggests that outsourcing erodes employment protection and job quality and leads to long-term scarring of labor market outcomes.
The Effect of Adverse Life-Events on Income Trajectories
with Simon Rabate, Maxime To, Julie Treguier and Willem van der Wal
CPB Discussion Paper (link) and Dutch summary in ESB (link)
This paper studies and compares the effect of different adverse life events -- job loss, disability and health shocks, divorce and spousal death -- on individuals' income trajectories. We use an harmonized design across events in terms of methodology and data: matching difference-in-difference with exhaustive Dutch administrative registers. We assess the effect of adverse events on different margins. We compare their effect on primary and disposable household income in order to measure the public insurance to the shocks provided by the tax and transfer system. Both between different events and within different groups for a given event, we find that the importance of government insurance increases with the severity of the shock on primary income. However, we find that certain groups of the population are relatively less protected against adverse life events, such as young people facing a large health shock or secondary earners facing a divorce.
Technological Change, Job Loss and Disability Insurance
with Bram Wouterse
Working paper coming soon!
We estimate the impact of technological change on the probability of receiving disability insurance and worker health by combining Dutch administrative and survey data. We show that workers in jobs more exposed to technological change are more likely to get disability insurance. We confirm these findings in a difference-in-differences design exploiting mass layoffs for identification. For a one standard deviation increase in technology exposure, workers are between 13 and 25% more likely to end up in DI. We find a short-term increase in the use of antidepressants after job loss for workers more exposed to technology, but no evidence of long-term health effects. This suggests that DI acts as a gateway out of the labor force for workers negatively affected by structural change.
The Effect of Minimum Wage Increases on Youth Crime and Economic Independence (with Ruben van Loon and Timo Verlaat)
The Effect of Introducing an Hourly Minimum Wage (with Ruben van Loon)
Labor market effects of wage subsidies for minimum wage workers
Do parents work more when children are in school? Evidence from the Netherlands (joint with Lisette Swart and Karen van der Wiel): CPB Discussion Paper (link), IZA Discussion Paper (link)
Knowledge diffusion across regions and countries: evidence from patent citations. (joint with Jonneke Bolhaar and Roel van Elk): CPB Discussion Paper (link)