‘Bad Jobs’ in Europe: Derivation and Analysis of a Wellbeing-Related Job Quality Threshold

Abstract

A method is proposed for defining the threshold of a ‘bad job’, based on a discontinuity in the relationship between a composite index of job quality and subjective wellbeing. Applied to European data, there is a monotonic relationship between the job quality index and psychological wellbeing. However, there is a distinctly large increase in psychological wellbeing, and in several measures of work-related wellbeing, between workers in the lowest decile and those in the second lowest decile of job quality. We therefore propose that ‘bad jobs’ should be designated as those in lowest decile. Using this threshold gives a ‘bad jobs’/ ‘other jobs’ dichotomy that discriminates on wellbeing far better than definitions based only on low earnings and job insecurity. Using multi-level probit analysis, we find that bad jobs are more common in poorer countries and in countries with weaker labour regulation. Three findings differentiate the distributional pattern of bad jobs from that of low-earnings jobs: first, the prevalence of bad jobs is greater in large establishments; second, there is no gender gap in the prevalence of bad jobs; third, working in the private sector raises the chance of being in a bad job but not of being in a low earnings job.