Part-Time Work, Fixed-Term Contracts, and the Returns to Experience

Using data from Spanish Social Security records, we investigate the returns to experience for female workers in different flexible work arrangements. Our model consists of four random-effects equations simultaneously estimated using Markov Chain Monte Carlo techniques. We find a large negative wage effect of working part-time (PT), which differs by motherhood status and contract type. We also find that working PT involves lower returns to experience than standard full-time employment and thus a substantial negative wage effect accumulates over time for those employed PT. Finally, our simulations reveal that working PT also raises the probability of working under a fixed-term contract.