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Fixed-Term Contracts: Short-Term Blessings or Long-Term Scars? Empirical Findings from the Netherlands 1980–2000



Using a comprehensive longitudinal dataset of prime-age Dutch workers over the period 1980–2000, we examine how a previously held job with a fixed-term contract influences both the likelihood and the duration of a future spell of unemployment. Analyses show that Dutch workers with fixed-term contracts experience higher risks of future unemployment and have no shorter spells of unemployment compared to workers with regular contracts. Results also reveal that swifter employment re-entries among men with fixed-term contracts can be explained by their job search efforts before unemployment. Our study (partly) invalidates theoretical positions that claim that fixed-term contracts foster employment security by shortening unemployment durations; suggesting that fixed-term contracts are a short-term blessing that could end, for some workers, in a recurrent unemployment trap.