On Measuring the Social Opportunity Cost of Permanent and Temporary Employment

What is it about?

A model is developed to evaluate the social opportunity cost of labour employed in permanent and temporary jobs. It allows for labour migration between regions and includes a measurement of the secondary impact of job creation programs on the regions. An application of the model is carried out for the Cape Breton region of Canada. The principal policy conclusion is that the social opportunity cost per man-year of permanent employment is significantly less than the social opportunity cost per man-year of temporary employment. Thus, governments should be concerned not only with the number of dos created by their programs but also with the quality of employment opportunities made available.

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