Study On The Impact Of Open-ended Labor Contract On Enterprise Employment

The relevant provisions of open-ended labor contract in the Labor Contract Law are highly controversial,the legal and value-oriented debate of its impact on the employment of enterprises is up to now.Two nearly opposing viewpoints are both distinctive,but due to the lack of data,empirical evidence of the impact on enterprises employment has not been systematically formed.The salary survey conducted by the Office of Human Resources and Social Security has a detailed record of labor cost,employment mode and contract types.This paper uses the survey of Hangzhou enterprises in 2013,and matched it with the Third Economic Census'financial data of enterprises,forming "enterprise-employee"matching data,quantitatively examining the impact of signing open-ended labor contract on enterprises employment.In order to provide basic information for the future improvement and revision of the Labor Contract LawBased on the theory of Salary Stickiness and Man-job Matching,we study the impact of signing open-ended labor contract on the enterprises employment from three dimensions:(1)Whether it will lead to an increase in labor costs;(2)Whether it will lead to the obstacle of the corresponding employment structure adjustment in the path of transformation and upgrading of enterprises;(3)Whether the enterprises will take measures to circumvent it,which may affect the realization of the law's protection goal.Result shows that:(1)In the overall sense,open-ended labor contract hasn't had a significant impact on the labor costs of enterprises,but the increase in the signing rate of open-ended labor contract has significantly increase the labor costs per unit in labor-intensive enterprises;(2)Regardless of labor-intensive,capital-intensive or large-scale and small-scale enterprises,signing open-ended labor contract is not conducive to the adjustment of employment structure on the path of transformation and upgrading,which is manifested by the higher the signing rate of open-ended labor contract,the greater the obstacles to employment structure adjustment(the ratio of skilled workers to unskilled workers is significantly lower);(3)The phenomenon that enterprises avoid signing open-ended labor contract by extending working hours and using labor dispatchers is common.The higher the signing rate of open-ended labor contract,the higher the proportion of labor dispatchers and the longer the average weekly working hours;(4)The human capital level of employees is directly related to the strength of the open-ended labor contract.No matter which type of enterprises,the longer the average years of education for the employees,the weaker the impact of open-ended contract to its labor costs,employment structure and employment modeBased on the above emp irical evidence,we believe that the impact of open-ended labor contract on enterprises employment cannot be ignored.The first thing that needs to pay attention is the negative impact on the adjustment of employment structure,which is directly related to the speed and efficiency of enterprises' transformation and upgrading.Although the overall impact on the labor cost of enterprises has not yet occurred universally,evasive behaviors such as significantly extending working hours and increasing the use of labor dispatcher indirectly reflect that the open-ended labor contract constitutes a constraint on the employment of enterprises,and the impact on labor costs in labor-intensive enterprises has actually existed.Based on this judgment,the paper proposes policy recommendations accordingly.