Fragmented Stability: Recalls and Fixed-Term Contracts in a Dual Labour Market

Olivier Charlot (), Franck Malherbet () and Eloïse Menestrier ()
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Olivier Charlot: CY Cergy Paris Universite, CNRS, THEMA
Franck Malherbet: ENSAE, Institut Polytechnique de Paris, CREST and IZA
Eloïse Menestrier: Institut National d’Etudes Demographiques (INED)

No 2026-10, Working Papers from Center for Research in Economics and Statistics

Abstract: This paper documents a neglected dimension of labour market dualism: the repeated hiring of the same worker by the same employer through short fixed-term contracts. Using exhaustive French hiring declarations from 2012 to 2019, we show that recalls account for a large share of employment entries and that, unlike the classic temporary-layoff patterns emphasised in the United States, they occur overwhelmingly through fixed-term contracts of very short duration. Many workers are repeatedly rehired by the same employer, often several times within a year, while successive recalled contracts frequently have similar durations and are separated by short interruptions. These patterns reveal employment relationships that persist at the employer–worker dyad level while remaining fragmented at the contractual level, a configuration we term fragmented stability. We introduce an empirical measure of this phenomenon based on the timing of recalls and the similarity of successive contracts, and show that it represents a quantitatively important component of fixed-term hiring flows. We also find that many recall sequences appear difficult to reconcile with a strict reading of the intended constraints governing the repeated use of fixed-term contracts. Overall, our results suggest that labour market dualism operates not only through the coexistence of permanent and temporary jobs, but also through the repeated interruption and reactivation of persistent employer–worker relationships.

Keywords: Fixed-term contracts; recalls; rehiring; employment protection legislation (search for similar items in EconPapers)
JEL-codes: J21 J41 J42 J63 J64 J68 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2026-09-08
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