Scarring, Habituation and Job Flexibility: Work Histories in Secure and Insecure Employment

Abstract

Increases in the use of flexible employment contracts create more frequent transitions between unemployment and employment. This paper analyses the impact of cumulative unemployment experiences on the life satisfaction of Australian male workers in flexible employment. Using panel data techniques, it was found that permanent contract workers were scarred by previous unemployment. This contrasted with flexible contract workers who seem habituated to the effects of past unemployment. Social norming effects were evident for permanent workers, unemployment scarred deeper when it was less of a general norm, this was not the case for casual workers. Flexible contract workers' habituation to past unemployment and lack of social norming could contribute to the process of social exclusion.