The Impact of Employment Protection on Health: Evidence from Fixed-term Contract Workers in South Korea

Abstract

In this paper, we examine the impact of increased employment protection on the self-rated health of workers. We utilize the recent labor reform in South Korea which sharply increased the employment protection level of fixed-term contract workers meeting certain criteria. By applying a difference-in-differences framework to longitudinal data, we explore the causal impact of employment protection. We find that subjective health and perceived job security improved with increased statutory employment protection. Further analysis suggests that the improvement in subjective health is less likely to be driven by improvement in working conditions or health related behaviors.