Youth earnings and labour market volatility in Europe

Abstract

We provide new evidence on earnings volatility and labour market volatility, which also includes flows into and out of employment, of young workers across Europe during the Great Recession, and examine the institutional factors that may shape these flows. Using EU-SILC data, we document large disparities in volatility levels and trends across European countries. As expected, the Great Recession increased volatility among Europe’s youth, offsetting the falling trend observed over the last years of economic prosperity. Larger unemployment benefits and more stringent employment protection legislation are related to lower earnings and labour market volatility