Dual Labour Market Reform and Employment Outcomes: Evidence From Poland

Between 2005 and 2015, Poland recorded one of the highest shares of temporary employment in the European Union. Following labour market reforms introduced in 2016–2017, the incidence of temporary contracts declined markedly. This paper examines how this decline was associated with the level of dependent and permanent employment. The study covers the period 2008–2023 and uses quarterly sectoral data (NACE Rev. 2) disaggregated by gender and age group. The analysis employs second‐generation panel estimators that account for cross‐sectional dependence and heterogeneous dynamics, using CS‐ARDL as the main specification and AMG and CCEMG as robustness checks. The results indicate no evidence of a contraction in dependent employment in the post‐reform period. The association between temporary and dependent employment remains positive but becomes weaker after the reform. In contrast, the estimates do not provide consistent evidence that declines in temporary employment systematically translate into increases in permanent employment.