Fixed-term employment, work organization and job satisfaction: Evidence from German individual-level data

The present paper examines the joint effect of fixed-term employment and work organizationon job satisfaction using individual-level data from the German Socio-Economic Panel(GSOEP). Specifically, we analyze whether workers who are heterogeneous in terms of thetype of working contract (fixed-term vs. permanent) do also differ with regard to jobsatisfaction, when they perform under comparable work organizational conditions. Suchinformation would be quite valuable for employers, because they can learn about theresponsiveness of heterogeneous workers to innovative work organizational practices. For thispurpose, we at first estimate a linear fixed effects model, thereby controlling for unobservedtime-constant characteristics. In a second step, we account for potential remainingendogeneity by combining the fixed effects approach with a two-stage estimation strategy.Our empirical results show that in terms of job satisfaction fixed-term workers and theirpermanent counterparts respond differently to a number of organizational practices includingtask diversity, employee involvement, social relations at work, general working conditions,and career prospects. The results may be used by employers to improve their concept ofdiversity management and specifically the job design of heterogeneous workers.