Chapter 4 Methodological Background
4.1.4 Key Independent Variables
4.1.4.1 Standard and Non-Standard Employment
The key independent variables in the empirical chapters are different indicators of employment insecurity, above all non-standard forms of employment and unemployment. The point of refer- ence is the standard employment relationship, defined as a full-time, permanent position without the involvement of a temporary employment agency. Non-standard employment in Germany com- prises fixed-term contracts, temporary agency work, part-time work and minijobs (see Chapter 2). Table 4.1 below gives an overview of the questions drawn upon to identify the different types of non-standard employment in the SOEP. Generally, for individuals who have more than one job, the classification of employment types relates to the main job. This is due to the fact that comprehen- sive information on the nature of the job (e.g. contract type, involvement of a temporary employ- ment agency) is collected only for the main job, while little is known about the nature of workers’ side jobs (solely the number of working hours/days and earnings).
Fixed-term contract workers were identified via a question asking respondents about the type of their contract.81 Standard workers are characterised by a permanent contract, while those who
describe their contract as fixed-term are assigned to the category of fixed-term contract workers. In some waves between 1986 and 1994, only those respondents who reported a job change were asked this question. Therefore, in these waves the information from the previous year had to be carried forward for those who reported that they stayed with the same employer.
79 Due to variations in the month of the yearly interviews as well as wave non-response, it is possible that more than one year passes between the last interview and the start of the pregnancy. However, in order to secure proximity between the measurement point of the covariates and the pregnancy, the event variable was only coded as 1 if a pregnancy starts within the next 12 months and as 0 otherwise.
80 This entails that the most recent SOEP wave (2013) had to be discarded completely for fertility analysis, while for the second to last wave (2012) only those (very few) couples could be retained that report a birth in 2013.
81 This question (as well as the questions on temporary agency work and minijobs) is not available in the Youth Question- naire, which 17-year-old respondents receive rather than the Individual Questionnaire. However, due to the focus on couples in joint households, there are only very few 17-year olds in the sample, and all of them are still in education. As persons in education were assigned a separate category on the employment status variable (see Section 4.1.4.2), the questions regarding their employment are not relevant for classifying them.
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Table 4.1: Identification of non-standard employment in the SOEP
Form of
employment Question in Individual Questionnaire Asked since
Fixed-term
contract work Do you have a fixed-term or permanent employment contract? Permanent contract ( ) Fixed-term contract ( )
Not applicable, do not have an employment contract ( )
1985
Temporary
agency work Is this work through a temporary employment agency Leiharbeit)? (Zeitarbeit, Yes ( ) No ( )
2001
Part-time
work And how many hours do you generally work, including any overtime? ( ) hours per week 1984 Minijob Is it “marginal” part-time work in accordance with the 400/800–euro rule
(Mini-Job, Midi-Job)?
Yes, Mini-Job (up to 400 euros) ( ) Yes, Midi-Job (400 to 800 euros) ( ) No ( )
2001
Source: Author’s compilation from DIW Berlin/SOEP (2013).
Note: Wording of questions as of 2012 questionnaire; alterations in question wording over time.
There is a considerable number of workers who state that they do not have an employment con- tract. Firstly, this group comprises self-employed persons, who by definition do not have an em- ployment contract (unless they are employees of their own businesses). As self-employed persons were assigned a separate category on the employment status variable, this was unproblematic (see Section 4.1.4.2). Secondly, a large number of civil servants (Beamte) state that they do not have an employment contract. This is the formally correct answer as this type of civil servant is indeed gen- erally not provided with an employment contract. However, the answer “no contract” is not helpful if the aim is to determine whether the civil servant is in a long-term relation with their employer or not. For the empirical analysis of partnership dissolution in Chapter 7, this missing information was irrelevant as Beamte were assigned their own category on the employment status variable. This could not be done, however, for the analysis of first childbirth in Chapters 5 and 6 (see Section 4.1.4.2). Therefore, additional information on tenure with the employer was used to fill in the miss- ing information on contract type: As German Beamte are usually hired for life after a few years, all
Beamte who stated they have been with their current employer for at least five years82 were as-
sumed to be permanent workers. Those with a tenure shorter than five years cannot be classified with certainty, as they might already be hired for life or might still be on probation. Therefore, an additional category was created that included workers with insufficient information (“employee,
82 The regulations vary between federal and state-level officials and from state to state, but overall five years can be seen as a maximum period after which the vast majority of Beamte will be hired for life.
86 missing details”).83 Thirdly, there is a large group of respondents who are dependent employees
and not civil servants but who still state that they do not have an employment contract. In some cases, this might be due to respondents having verbal agreements with the employer instead of a written contract. However, as verbal agreements constitute employment contracts exactly like written contracts, an employee without employment contract is not a meaningful category. There- fore, this group is also assigned to the category for employees with missing details.
Temporary agency workers were identified via a question asking respondents if they work through a temporary employment agency.
In order to identify part-time workers, the SOEP offers the alternatives of setting a certain threshold regarding working hours or using the respondent’s self-classification as part-time or full- time. The disadvantage of the self-identification strategy is that the same number of working hours considered to be part-time by one worker is considered to be full-time by the other. As mentioned (Chapter 2), the definition of full-time work (and therefore also part-time work) can differ by indus- try, occupation or firm. To ensure transparency and comparability between workers, it is thus useful to set a certain threshold of working hours. In this study, part-time work is uniformly defined as less than 35 usual weekly working hours (in the main job).84 Respondents without valid information on
their number of working hours were added to the category “employee, missing details”.
Minijobs are characterised by the fact that the usual earnings may not exceed a certain thresh- old, which increased from DM630 (€322) in 2001 to €450 in 2016. In the SOEP, a question asking specifically about this type of employment was introduced in 2001,85 and the wording of the ques-
tion has changed in line with the earnings threshold since then. Respondents receive this question if they report less than 30 usual weekly working hours (in their main job). Every respondent stating “Yes, Mini-Job” was classified as minijobber. Midijobbers were assigned to the regular part-time category.
83 An alternative to the creation of this missing category would have been to discard observations with missing infor- mation. This would have meant the loss of a considerable amount of information: Since the analysis in this study is often based on couple data, the information for the whole couple would have had to be deleted if only one of the partners had missing information on a variable.
84 This threshold ensures that few full-time workers will be falsely classified as part-time. The vast majority of collective agreements in Germany currently stipulate at least 35 hours as (full-time) working hours, and the average working hours in collective agreements ranged from 39.6 in 1984 to 37.4 in 2012 (Bispinck and Schulten 2017).
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4.1.4.2 Other Employment Statuses
To generate an employment status variable that fits all respondents, several more categories had to be created. The main basis for this classification was several generated variables provided in the SOEP, i.e. the employment status, labour force status and occupational position variables. Infor- mation from these variables was combined into a single employment type/status variable.
As mentioned, a separate category was created for self-employed persons (and family work- ers). Furthermore, for the analysis of partnership dissolution (Chapter 7), civil servants (Beamte)
were assigned their own category.86Moreover, categories for the non-working population – “un-
employed”, “in education” and “inactive” – were constructed. In this context, it has to be noted that some respondents might fit several categories, e.g. unemployed respondents can pursue a course of study at the same time. For the assignment of respondents to a certain category, the following hierarchy was applied:
• employment (unless only a side job) trumps the non-working categories, • unemployment trumps educational participation and economic inactivity, • educational participation trumps economic inactivity and
• inactivity only applies if no other category fits.
Regarding unemployment, two different measures were used in this study: In the empirical chapters focusing exclusively on Germany (Chapters 5 and 7), the central criterion is whether a respondent is registered as unemployed with the Federal Employment Office. As it is possible to be registered as unemployed and be employed at the same time, persons were only classified as unemployed if they reported not to be employed (on a full-time, part-time or marginal/irregular basis). They can still have a side job and be classified as unemployed, however. In contrast, for the internationally comparative analyses (Chapter 6), unemployment was defined according to the definition of the International Labour Organization (ILO) (Thirteenth International Conference of Labour Statisticians 1982), meaning that persons are counted as unemployed if they have not worked within the past week, are actively looking for work and are available to start work straight away. HILDA follows the ILO approach and cannot be reclassified according to the SOEP concept of registered unemploy- ment. In contrast, in the SOEP both the registered unemployed and the unemployed according to ILO can be identified, albeit the wording of the questions is slightly different to HILDA.87 Therefore,
86 In the analysis of first childbirth (Chapters 5 and 6), Beamte were not given their own category for two reasons: Firstly, the samples are relatively small so that creating another employment status category would have resulted in small cell sizes, particularly for the analysis of subgroups such as East Germans. Secondly, there is no comparable employment status in HILDA.
87 Firstly, there are differences regarding the question on actively looking for work: In the SOEP, there is a general question about actively looking for work, while in HILDA respondents are asked to state exactly what steps they have taken to find
88 the ILO approach was chosen for both datasets for the internationally comparative analyses. The disadvantage of applying the ILO concept to the SOEP was that a large group of workers appeared who counted as employed according to the ILO concept but who just had a side job besides unem- ployment or homemaking. As mentioned (section 4.1.4.1), the SOEP does not collect comprehen- sive information on side jobs, so these cases had to be added to the category “employee, missing details”. Generally, for those respondents who are in education and unemployed at the same time, unemployment trumps being in education. This is reasonable on the grounds that unemployed per- sons often start courses precisely because they cannot find employment.
Peoplein school, at university, in an apprenticeship or in a traineeship were assigned the cat- egory “in education”. Apprenticeships and traineeships were thus treated as a phase of education rather than gainful employment. This is useful on the grounds that these arrangements are by def- inition fixed-term, so they would contribute a large share of the fixed-term worker category. A com- plication arises from the fact that people can participate in a course of study and work at the same time (apart from an apprenticeship)88. It neither seems useful to classify all students who work
besides studying as “employed”, nor to assign all workers who pursue some kind of studies besides their jobs to the “in education” category. On objective grounds, however, it is difficult to determine which activity is the respondent’s “main activity”. Therefore, respondents are classified as “in edu- cation” if they attend a course of study and state that they are not employed (on a full-time, part- time or marginal/irregular basis); however, persons classified as in education may have a side job.
Respondents are classified as inactive if they state that they are not employed, not in education and not unemployed. They might for example be retired or homemakers. People classified as inac- tive can have side jobs.
work. In HILDA, persons who already found a job and are waiting to start within the next four weeks are also considered unemployed (even though not actively looking for work anymore). In the SOEP, there exists no equivalent question. Sec- ondly, the question concerning the availability to start work differs regarding the reference period: While in HILDA re- spondents are asked retrospectively whether they would have been able to start work the week before, in the SOEP the question refers prospectively to starting work within the next two weeks.
88 This applies to approximately 3% of the female and 2% of the male employees in the sample for the analysis of part- nership dissolution (Chapter 7). The share is particularly large among the fixed-term part-time workers: 9% of the women and even 27% of the men in this category pursue some kind of studies, most frequently studies at university. Among the samples for the analysis of first childbirth (Chapters 5 and 6), the shares of respondents who are employed and in educa- tion at the same time are even larger due to the lower average age of the respondents.
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