Workers and Unemployes Expectations' Concerning the End of the CrisisEvidence for European Union-27 and Other Candidate Countries

Abstract

Employment. Unemployment. Expectations. European Union In this paper we explore the determinants of individuals' exceptations concerning their occupational status using data from the Eurobarometer 71,2 for 30 European Countries. We estimate a selection endogenous dummy ordered probit for the probability of keeping current job or finding a new one, that takes into account possible self-selection issues as well as the influence of individuals' prospects with respect to national economic recovery. Results obtained indicate, first, that the higher unemployment regional rate the lower the expectations regarding that economic crisis has reached its peak. Second, having an unemployment rate higher than the European average decreases the expectations of national economic crisis, and third, workers' expectations are more negatively influenced by regional and national unemployment rate that those of the unemployed. Predicted probabilities point to a group of four countries (Denmark, Sweden, Finland and Netherlands) with the best expectations for keeping current job or finding a new one. On the contrary, the group of countries with the worst expectations is less homogenous and depens on the outcome studied (Bulgaria, Cyprus, Greece, Lithuania; malta, Poland, Portugal, Slovakia an Turkey). Finally, regarding labour market polcies, higher expenditure in labour market services and start-up incentives increase the confidence of both workers and unemployed, whereas the extension of early retirement generates opposite effects between both groups.