flexicurity in the crisis or the crisis of flexicurity? ton wilthagen tilburg university, the...
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Flexicurity in the crisis or the crisis of flexicurity?Ton WilthagenTilburg University, the Netherlands
[email protected] www.uvt.nl/reflect
Questions on preconditions of flexicurity – when it all begun
• Geography: is flexicurity only possible in the North Western part of Europe, where certain levels of flexibility and security already exist?
• Size: is flexicurity a “small country thing” – coordination is the problem in large countries (federal structure)
• Personal factor: does flexicurity depend on certain architects/ institutional agents?
• Labour market/business cycle: is flexicurity only feasible in sound economic and labour market conditions?
Is flexicurity a sunny weather concept?
Flexicurity
How about flexicurity in bad weather?
Crisis is natural experiment!
This presentation
1 Flexicurity itself as a paradigm shift in the regulation of labour markets and employment
2 Does the crisis mean a shift?
• the content (modalities) of flexicurity?
• in the coordination and organisation of flexicurity?
• In the performance of flexicurity
• in the flexicurity solutions?
3. And where is this all taking us?
Measuring flexicurity
Source: Chung & Wilthagen, forthcoming
Policy change: significant or not?
Danish flexicurity in crisis
Country
Policy change
No change
•Current policy not working
•Symbolic for the public or EU
•Structural or temporary ?
•Current policy adequate
•Or: change not possible – politics, capacity or money
Flexibility and security modalities (Flexicurity Matrix)
security
flexibility
Job security
(remain in same job)
Employment security (job to job; no job to job)
Income security (social security)
Combination security (work and care)
External - numerical
(hire and fire)
Internal - numerical
(working-time flexicurity)
Functional
(employability)
Variable pay
Flexibility and security modalities (Flexicurity Matrix)
security
flexibility
Job security
(remain in same job)
Employment security (job to job; no job to job)
Income security (social security)
Combination security (work and care)
External - numerical
(hire and fire)
Danish and
Dutch flexicurity
Internal - numerical
(working-time flexicurity)
Functional
(employability)
Variable pay
The crisis and flexibility and security modalitiessecurity
flexibility
Job security
Employment security
Income (social)
security
Combination security (work and care)
External - numerical
(hiring and firing)
Temporary
placement
other firm
Mobility centres;
Worker pools
UB as wage subsidy;
retirement; lower tax
Mortgage support
Internal - numerical
(working-time flexibility)
Shorter working hours; WT
accounts
Multi-employership
Part-time UB; reduced working hours
Take up of leave schemes
holidays
Functional
(employability)
Job rotation
Internships other firm;
Retraining
Retraining for new job
Accreditation
of prior learning
Variable pay Adjust-
ment of wages
Supplement wage new
job
Extra UB;
private
savings
Increased family allowance
Flexicurity Coordination Mechanisms Matrix
Coordination Mechanisms and the provision of flexibility and security
Coordination
mechanism
Associations
social partners
collective
agreements
Networks
of firms, clients,
suppliers etc
Hierarchies
(individual)
firms
State
at various levels
Markets
including
sub markets
Communities
family, neighbourhood
Crucial
condition for
Mechanism
Mutual trust
Representati-vity
Mutual interest
Stakeholdership,
good
employership
Legitimacy
and
enforceability
Transparency
and
information
Inclusiveness and
responsibility
Type of
flexibility
provided
Wage
Functional
Internal
External
Functional
Internal
Wage
External
Internal
External Internal
Wage
Type of
security
provided
Job
Employment
Combination
Employment
Job
Employment
Combination
Job
Income
Combination
Job
Employment
Combination
Income
Combination
Flexicurity Coordination Mechanisms Matrix
Coordination Mechanisms and the provision of flexibility and security
Coordination
mechanism
Associations
social partners
collective
agreements
Networks
of firms, clients,
suppliers etc
Hierarchies
(individual)
firms
State
at various levels
Markets
including
sub markets
Communities
family, neighbourhood
Crucial
condition for
Mechanism
Mutual trust
Representati-vity
Mutual interest
Stakeholdership,
good
employership
Legitimacy
and
enforceability
Transparency
and
information
Inclusiveness and
responsibility
Type of
flexibility
provided
Wage
Functional
Internal
External
Functional
Internal
Wage
External
Internal
External Internal
Wage
Type of
security
provided
Job
Employment
Combination
Employment
Job
Employment
Combination
Job
Income
Combination
Job
Employment
Combination
Income
Combination
Over past year much effort has been put in developing flexicurity indicators
• EMCO (Employment Committee of EU)http://ec.europa.eu/social/main.jsp?catId=102&langId=en
• European Commission: composite indicators on contractual flexibility, life-long learning, ALMP and modern social security
• By academics: various indicators (sometimes mixing up ‘efforts’ and ‘states’ indicators), among which dynamic indicators (Ruud Muffels)
1. Strictness of employment protection 9. Net replacement ratios in the first as well as after 5 years
2. Diversity of and reasons for contractual and working arrangements
10. Unemployment trap, seen as a measure of benefit levels
3. % of adult population between 25 and 64 participating in education and training
11. Employment rate, total, for women, and for older workers
4. Educational attainment of age cohorts
45-54 and 25-34
12. Youth unemployment ratio (15-24 years)
5. Expenditure on active and passive labour market policies as a % of GDP
13. Long-term unemployment rate
6. Expenditure on active and passive labour market policies per unemployed person
14. Growth in labour productivity
7. No. of participants in active labour market policies, by type of measure
15. Quality in work
8. Share of young or adult unemployed not offered job or activation measure within 6 or 12 months
16. At risk of poverty rates
Draft flexicurity Background indicators2007 Communication
Measuring flexicurity (state, policy)
Measuring flexicurity performance (in view of crisis and in general)
Measuring flexicurity performance in times of crisis
• Economic growth/recovery?• (Un)employment rates, change of these rates?• Labour market participation levels?• Unemployment duration/long-term unemployment rates?• Mobility/labour turnover/job to job rates?• Speed/chance of reintegration back into the labour
market?• Job destruction/creation rates?• Position of weak groups (temp workers)?• Investments in ALMP/LLL• Income replacement rates• Subjective assessment of job/income insecurity?
Unemployment rates in the EU
Change in part-time employment as a share of total employment between 2008Q2 and 2009Q
Part-time work increases due to shorter working hours schemesand reduction of working-time
How should this be evaluated?
Employees with temporary contracts
Solutions: how about the pathways to flexicurity?
• Flexicurity pathway 1: dealing with flexibility at the margin
• Flexicurity pathway 2: securing transitions from job to job
• Flexicurity pathway 3: access to learning and good transitions for all
• Flexicurity pathway 4: comprehensive social security supporting transitions to regular work
Need for specific ‘crisis pathway’?
To conclude with
Back to the question: flexicurity in crisis times or thecrisis of flexicurity?
• Face of flexicurity might change, but rather temporarily than in a structural way
• From Danish/Dutch external flexibility + employment security to continental (German, Belgian etc) combination of internal flexibility + job security
• A (temporary) shift ‘powered by’ the State and less by the social partners
• European Commission wishes to continue flexicurity post 2010
Commission’s Communication on release of Employment in Europe 2009
• European labour markets will be changed profoundly by the crisis and the transition to a low carbon, knowledge-based economy, and workers and companies must be given the necessary means and incentives to successfully adjust to these changing realities in ways which favour inclusion, equity and social justice. Flexicurity, combined with comprehensive active inclusion policies, remains the right approach to both modernising labour markets and ensuring a successful recovery.
To conclude with• Who will be the carriers of flexicurity other than traditional
social partners?
• Flexibility will spread, notwithstanding future labour shortages; traditional securities will not expand.
• Flexi-quality will be precondition for future flexicurity: quality, productivity and sustainable use of both human and natural resources
• Much interest coming from countries outside EU (which often already have high levels of flexibility and are lacking security, but not in all cases)
• Better indicators and monitoring are essential!