{"id":452427,"date":"2026-09-22T15:33:28","date_gmt":"2026-09-22T13:33:28","guid":{"rendered":""},"modified":"2026-09-22T15:33:29","modified_gmt":"2026-09-22T13:33:29","slug":"temporary-layoffs-and-long-run-labour-market-scarring-evidence-from-austria","status":"publish","type":"publication","link":"https:\/\/www.wifo.ac.at\/en\/publication\/452427\/","title":{"rendered":"Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria"},"content":{"rendered":"","protected":false},"featured_media":0,"template":"","class_list":["post-452427","publication","type-publication","status-publish","hentry"],"acf":{"subtitle":"","text":"Temporary layoffs \u2013 employment separations followed by recall to the same employer \u2013 are widely used to buffer short-term demand fluctuations, yet their long-term worker consequences remain poorly understood. Using Austrian administrative data and propensity-score matching, we estimate their long-run effects by comparing workers experiencing short, non-seasonal interruptions during their first employment year with similar workers whose employment continues uninterrupted over the same first-year period. Outcomes are measured from the second year onward. Over ten years, affected workers accumulate about 3.5 months less employment and three months more unemployment, while cumulative earnings decline by more than 6,000 \u20ac. Monthly earnings during employment are also slightly lower, providing no evidence of compensating wage differentials. The results indicate substantial worker welfare costs and fiscal externalities and suggest that current institutional arrangements may encourage firms to shift adjustment costs to workers and the unemployment insurance system.","onlinedate":"2026-09-22 13:33:30","lang":"English","publication_series":"","publication_date":"20260922","publication_date_year":"","publication_date_full":true,"publication_num_pages":"21","keywords":"[]","jelcodes":"[]","related_publications":"[]","pdf":452430,"zip":null,"link":"","monthly_report":true,"monthly_report_main":false,"monthly_report_volume":"","monthly_report_pages":"","monthly_report_pages_sort":"0","issue":"734","journal":"WIFO Working Papers","publisher":"","invisible":false,"external":false,"embargo_date":null,"types":[44410],"research_groups":[3510],"collaboration":"","persons":[3581,3614,3684,3553],"persons_data":"[{\"personId\":3581,\"personName\":\"Rainer Eppel\",\"organisationNames\":[]},{\"personId\":3614,\"personName\":\"Thomas Horvath\",\"organisationNames\":[]},{\"personId\":3684,\"personName\":\"Helmut Mahringer\",\"organisationNames\":[]},{\"personId\":3553,\"personName\":\"Christine Zulehner\",\"organisationNames\":[]}]","clients":[],"subclients":[],"partners":[],"topics":[],"host_publication_title":"","host_publication_subtitle":"","place_of_publication":"","host_publication_editors":"[]","type_description":"","output_media":"","chapter":"","article_number":"","citations":"{\"apa\":\"<div class=\\\"rendering rendering_researchoutput  rendering_researchoutput_apa rendering_contributiontoperiodical rendering_apa rendering_contributiontoperiodical_apa\\\"><span>Eppel, R.<\\\/span><span>, Horvath, T.<\\\/span><span>, Mahringer, H.<\\\/span><span>, &amp; Zulehner, C.<\\\/span> (2026). <span>Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria<\\\/span>. <span><em>WIFO Working Papers<\\\/em><\\\/span>, (734).<\\\/div>\",\"vancouver\":\"<div class=\\\"rendering rendering_researchoutput  rendering_researchoutput_vancouver rendering_contributiontoperiodical rendering_vancouver rendering_contributiontoperiodical_vancouver\\\"><span>Eppel R<\\\/span><span>, Horvath T<\\\/span><span>, Mahringer H<\\\/span><span>, Zulehner C<\\\/span>. <span class=\\\"title\\\"><span>Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria<\\\/span><\\\/span>. <span>WIFO Working Papers<\\\/span>. 2026 Sept 22;(734).<\\\/div>\",\"bibtex\":\"<div class=\\\"rendering rendering_researchoutput  rendering_researchoutput_bibtex rendering_contributiontoperiodical rendering_bibtex rendering_contributiontoperiodical_bibtex\\\"><div>@misc{0e47617d41974f769a85ccc40d89338a,<\\\/div><div>  title    = \\\"Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria\\\",<\\\/div><div>  abstract = \\\"Temporary layoffs {\\\\textendash} employment separations followed by recall to the same employer {\\\\textendash} are widely used to buffer short-term demand fluctuations, yet their long-term worker consequences remain poorly understood. Using Austrian administrative data and propensity-score matching, we estimate their long-run effects by comparing workers experiencing short, non-seasonal interruptions during their first employment year with similar workers whose employment continues uninterrupted over the same first-year period. Outcomes are measured from the second year onward. Over ten years, affected workers accumulate about 3.5 months less employment and three months more unemployment, while cumulative earnings decline by more than 6,000 \u20ac. Monthly earnings during employment are also slightly lower, providing no evidence of compensating wage differentials. The results indicate substantial worker welfare costs and fiscal externalities and suggest that current institutional arrangements may encourage firms to shift adjustment costs to workers and the unemployment insurance system.\\\",<\\\/div><div>  author   = \\\"Rainer Eppel and Thomas Horvath and Helmut Mahringer and Christine Zulehner\\\",<\\\/div><div>  year     = \\\"2026\\\",<\\\/div><div>  month    = sep,<\\\/div><div>  day      = \\\"22\\\",<\\\/div><div>  language = \\\"English\\\",<\\\/div><div>  journal  = \\\"WIFO Working Papers\\\",<\\\/div><p>}<\\\/p><\\\/div>\",\"ris\":\"<div class=\\\"rendering rendering_researchoutput  rendering_researchoutput_ris rendering_contributiontoperiodical rendering_ris rendering_contributiontoperiodical_ris\\\"><p>TY  - GEN<\\\/p><p>T1  - Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria<\\\/p><p>AU  - Eppel, Rainer<\\\/p><p>AU  - Horvath, Thomas<\\\/p><p>AU  - Mahringer, Helmut<\\\/p><p>AU  - Zulehner, Christine<\\\/p><p>PY  - 2026\\\/9\\\/22<\\\/p><p>Y1  - 2026\\\/9\\\/22<\\\/p><p>N2  - Temporary layoffs \u2013 employment separations followed by recall to the same employer \u2013 are widely used to buffer short-term demand fluctuations, yet their long-term worker consequences remain poorly understood. Using Austrian administrative data and propensity-score matching, we estimate their long-run effects by comparing workers experiencing short, non-seasonal interruptions during their first employment year with similar workers whose employment continues uninterrupted over the same first-year period. Outcomes are measured from the second year onward. Over ten years, affected workers accumulate about 3.5 months less employment and three months more unemployment, while cumulative earnings decline by more than 6,000 \u20ac. Monthly earnings during employment are also slightly lower, providing no evidence of compensating wage differentials. The results indicate substantial worker welfare costs and fiscal externalities and suggest that current institutional arrangements may encourage firms to shift adjustment costs to workers and the unemployment insurance system.<\\\/p><p>AB  - Temporary layoffs \u2013 employment separations followed by recall to the same employer \u2013 are widely used to buffer short-term demand fluctuations, yet their long-term worker consequences remain poorly understood. Using Austrian administrative data and propensity-score matching, we estimate their long-run effects by comparing workers experiencing short, non-seasonal interruptions during their first employment year with similar workers whose employment continues uninterrupted over the same first-year period. Outcomes are measured from the second year onward. Over ten years, affected workers accumulate about 3.5 months less employment and three months more unemployment, while cumulative earnings decline by more than 6,000 \u20ac. Monthly earnings during employment are also slightly lower, providing no evidence of compensating wage differentials. The results indicate substantial worker welfare costs and fiscal externalities and suggest that current institutional arrangements may encourage firms to shift adjustment costs to workers and the unemployment insurance system.<\\\/p><p>M3  - WIFO series<\\\/p><p>JO  - WIFO Working Papers<\\\/p><p>JF  - WIFO Working Papers<\\\/p><p>ER  - <\\\/p><\\\/div>\"}","scientific_assistance":"[]","scientific_review":"[]","version":"","release_date":null,"expiration_date":null,"surveyor":"","research_assistance":"","edv":"","additional_info_de":"","additional_info_en":""},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.3 (Yoast SEO v28.3) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria - WIFO<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.wifo.ac.at\/en\/publication\/452427\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.wifo.ac.at\/en\/publication\/452427\/\" \/>\n<meta property=\"og:site_name\" content=\"WIFO\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/WIFOat\/\" \/>\n<meta property=\"article:modified_time\" content=\"2026-09-22T13:33:29+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.wifo.ac.at\/wp-content\/uploads\/2024\/05\/WIFO-Gebaeude-FotoAlexanderMueller-www.alexandermueller.at-IMG_6326-Bearbeitet-1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"1280\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:site\" content=\"@WIFOat\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/publication\\\/452427\\\/\",\"url\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/publication\\\/452427\\\/\",\"name\":\"Temporary Layoffs and Long-run Labour Market Scarring: Evidence from Austria - 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