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Productivity in German Manufacturing Firms: Does Fixed-Term Employment Matter?

Aufsätze referiert extern - Web of Science

Sebastian Nielen, Alexander Schiersch

In: International Labour Review 155 (2016), 4, S. 535-562


This study empirically analyses how the use of fixed-term employment affects labour productivity of establishments. To this end, a large data set of German manufacturing establishments and various panel data models are used in order to test the expected non-linear relationship between labour productivity and the use of fixed-term employees. The analysis takes into account the possible distortions that may result from selection into the use of fixed-term employment. The empirical results provide no evidence for the expected inverse U-shaped relationship between fixed-term employment and labour productivity. Testing for a linear relationship leads to mostly negative coefficients, which are only significant in a few specifications. Hence our results indicate that there is no significant relationship between the usage of fixed-term contracts and establishments labour productivity.

Alexander Schiersch

Research Associate in the Firms and Markets Department

JEL-Classification: D24;L23;L60
Keywords: fixed-term employment; labour productivity; manufacturing