This paper examines the impact of fxed-term employment on well-being from a cross-national comparative perspective by testing (1) the efect heterogeneity across European countries, (2) to which extent Jahoda’s Latent Deprivation Model provides a sufcient micro-level explanation for the underlying mechanisms and (3) whether the macro-level factor of social cohesion weakens the micro-level impacts. We investigate the efects in both an upwards (permanent employment) and a downwards (unemployment) comparative control group design. Due to the mediating role of social contacts on the micro-level, we assume social cohesion on the country-level to moderate the main efects: A high degree of societal afliation should substitute the function of social contacts in the work environ- ment of individuals. Using microdata from the European Social Survey (ESS) 2012 for 23 countries and applying multilevel estimation procedures, we fnd that there is a remarkable variation in the efects across countries. Even though in each country fxed-term employees have a lower subjective well-being compared to permanent ones, the point estimates vary from .17 to 1.19 units. When comparing fxed-term employees to unemployed individuals, the coefcients even range from − .27 to 1.25 units. More specifcally, a negative efect indicates that having a fxed-term contract is worse than unemployment in some countries. Moreover, pooled linear regression models reveal that Jahoda’s Latent Deprivation Model explains about three-quarters of the micro-level efect sizes for both directions. Eventually, social cohesion on the country-level diminishes the individual-level well-being diferences between fxed-term employees and permanent individuals but not between fxed-term employees and the unemployed.