The prototypical photoinduced dissociation of $Fe(CO)_{5}$ in the gas phase is used to test time-resolved x-ray photoelectron spectroscopy for studying photochemical reactions. Upon one-photon excitation at 266 nm, $Fe(CO)_{5}$ successively dissociates to $Fe(CO)_{4}$ and $Fe(CO)_{3}$ along a pathway where both fragments retain the singlet multiplicity of $Fe(CO)_{5}$. The x-ray free-electron laser FLASH is used to probe the reaction intermediates $Fe(CO)_{4}$ and $Fe(CO)_{3}$ with time-resolved valence and core-level photoelectron spectroscopy, and experimental results are interpreted with ab initio quantum chemical calculations. Changes in the valence photoelectron spectra are shown to reflect changes in the valence-orbital interactions upon Fe–CO dissociation, thereby validating fundamental theoretical concepts in Fe–CO bonding. Chemical shifts of CO 3σ inner-valence and Fe 3p core-level binding energies are shown to correlate with changes in the coordination number of the Fe center. We interpret this with coordination-dependent charge localization and core-hole screening based on calculated changes in electron densities upon core-hole creation in the final ionic states. This extends the established capabilities of steady-state electron spectroscopy for chemical analysis to time-resolved investigations. It could also serve as a benchmark for how charge and spin density changes in molecular dissociation and excited-state dynamics are expressed in valence and core-level photoelectron spectroscopy.