Accounting for the permanent vs temporary wage gaps among young adults: Three European countries in perspective

Abstract

AbstractThis article analyses wage differentials between permanent and temporary workers in the 25–40 age bracket using the 2010 European Union Statistics on Income and Living Conditions (EU‐SILC) wave data for France, Germany and Italy. Applying a Recentered Influence Function (RIF) regression and a reweighting estimation technique, we investigate the contribution of personal and job characteristics to wage differentials across the wage distribution. Results point to a large unexplained component of the wage gap across the whole distribution in Italy, while this component is weaker in France among highly paid employees and insignificant in Germany. These findings highlight potential policy considerations and areas for future research.