Employment and Earnings Expectations of Jobless Young Skilled: Evidence from Italy
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This paper uses an innovative survey instrument on employment and earnings quantitative expectations to measure the amount of job instability, insecurity, and earnings risk that jobless young skilled perceive. The survey was fielded in Italy, as one of the EU countries that suffered the highest increase in youth unemployment, and the data were merged with administrative records on local labor market conditions. The results show that Italian jobless young skilled perceive substantial job instability, insecurity and earnings risk, which correlate with several important choices and behaviors, and depend on individual characteristics rather than on local labor market conditions.
KeywordsJob instability and insecurity Earnings risk Subjective expectations Youth unemployment
JEL ClassificationJ31 J6 J62 D84
I thank Matthew Loveless for many helpful comments and discussions, and Annalisa Loviglio, Tito Boeri and the participants to the Trento Economics Festival 2015, to the Bocconi Food for Thought seminar, and to the INPS seminar series for useful comments and suggestions. Three anonymous reviewers provided several useful feedbacks. The financial support of the University of Southampton through a Strategic Research Development Fund, and the financial support and data access provided by the Italian Istituto Nazionale della Previdenza Sociale (INPS) through the VisitINPS Scholars Program are gratefully acknowledged. A previous version of the paper circulated under the title “Expectations of Job Instability, Job Insecurity, and Earnings Risk: A Pilot Study of Jobless Young Skilled in Italy”. All errors are mine.
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