introduction oecd )i. of

33
Chapter 2 A REVIEW OF LABOUR MARKETS IN THE 1980s A. INTRODUCTION Beginning and ending in recession, the 1980s were characterised, from 1983 to 1989, by a sustained increase in employment and by wage moderation, Huwever, this was accompanied by continuing high levels of unemployment and record levels of long-term unemployment, There was an increase in the preva- lence of non-standard forms of employment and a slowing growth of government employment. During the decade, the number of young people reaching working age attained its peak and most OECD coun- tries entered the 1990s with the prospect of diminish- ing numbers of younger workers for some years to come. The chapter treats the developments in OECD labour markets in the 198Os, with the aim of highlight- ing some of the implications for policy in the 1990s. It begins with population trends and proceeds to changes in employment, unemployment and wages. Special emphasis is given to developments in migration, to “non-standard’’ forms of employment and to trends in earnings. Policy implications are discussed in the con- cluding section. 3. MEDIUM-TERM POPULATION AND LABOUR FORCE DEVELOPMENTS 1. Medium-term trends in population The youth populution reached its peak daring the decade.. . Almost all Member countries entered the 1980s with record numbers of young people aged 15-24, newly- arrived into the warking-age range. The main excep- tions were Finland and Japan (and, less notably, Switzerland and Sweden) where the peak in the youth population had come earlier. However, by the begin- ning of the 1990~~ the upward trend was at or beyond its peak almost everywhere. It continued upward only in Ireland and Turkey, the two OECD countries where birth rates had remained high into the 1970s [OECD ( 1990a, Chapter 1 )I. The peaking of the youth population warned that future decades would see older working populations and higher ald-age dependency rates. This long-term trend will normally only be be reversed when the num- bers of young people rise again, which in turn can only happen many years after a recovery in birth rates. +.. birth rules remained low, excepf in u Jew cuu n tries Until recently, there seemed ta be no sign of recov- ery in birth rates in OECD countries - rather the reverse. The formerly high-fertility countries of Italy and Spain became those with the lowest levels in Europe (1.3 children per wornan in 1989). Even in Ireland the fertility level fell rapidly over the 1980s, to no more than replacement level (2.1) in 1989 [Monnier (‘ 19!9O)], However, since 1983 there have been new develop- ments in a number of Member countries, Sweden’s total fertility rate rose sharply from 1.6 children per woman in 1983 to 2 in 1989, the fastest rise seen in OECD countries for at least twenty years. It may have risen further in 1990, and similar though smaller rises have occurred in some of the other Nordic countries. Even in western Germany, the fertility rate climbed from a record low of 1.3 in 1985 tu 1.4 in 1989’. Meanwhile, total fertility in the United States rose from 1.8, its level over much of the decade, to 2 in 1989. To some extent these rises are considered to be due to women “catching up” on births they had post- poned, a phenomenon which can be seen to a lesser extent in some other countries. Fureign p~pukti~m grew a litlie faster, as numbers o f refugees and asylum-seekem ruse From the beginning of the 1980~~ the growth rate af the total foreign (non-national) population in Europe began to increase, after two decades of general slow- ing, even of absolute decline. Zn 1989, the maximum proportion of foreigners in the total population was 27 per cent in Luxembourg and 15 per cent in 29

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Page 1: INTRODUCTION OECD )I. of

Chapter 2

A REVIEW OF LABOUR MARKETS IN THE 1980s

A. INTRODUCTION

Beginning and ending in recession, the 1980s were characterised, from 1983 to 1989, by a sustained increase in employment and by wage moderation, Huwever, this was accompanied by continuing high levels of unemployment and record levels of long-term unemployment, There was an increase in the preva- lence of non-standard forms of employment and a slowing growth of government employment. During the decade, the number of young people reaching working age attained its peak and most OECD coun- tries entered the 1990s with the prospect of diminish- ing numbers of younger workers for some years to come.

The chapter treats the developments in OECD labour markets in the 198Os, with the aim of highlight- ing some of the implications for policy in the 1990s. It begins with population trends and proceeds to changes in employment, unemployment and wages. Special emphasis is given to developments in migration, to “non-standard’’ forms of employment and to trends in earnings. Policy implications are discussed in the con- cluding section.

3. MEDIUM-TERM POPULATION AND LABOUR FORCE

DEVELOPMENTS

1. Medium-term trends in population

The youth populution reached its peak daring the decade.. . Almost all Member countries entered the 1980s with

record numbers of young people aged 15-24, newly- arrived into the warking-age range. The main excep- tions were Finland and Japan (and, less notably, Switzerland and Sweden) where the peak in the youth population had come earlier. However, by the begin- ning of the 1 9 9 0 ~ ~ the upward trend was at or beyond its peak almost everywhere. It continued upward only

in Ireland and Turkey, the two OECD countries where birth rates had remained high into the 1970s [OECD ( 1990a, Chapter 1 )I.

The peaking of the youth population warned that future decades would see older working populations and higher ald-age dependency rates. This long-term trend will normally only be be reversed when the num- bers of young people rise again, which in turn can only happen many years after a recovery in birth rates.

+.. birth rules remained low, excepf in u Jew cuu n tries

Until recently, there seemed ta be no sign of recov- ery in birth rates in OECD countries - rather the reverse. The formerly high-fertility countries of Italy and Spain became those with the lowest levels in Europe (1.3 children per wornan in 1989). Even in Ireland the fertility level fell rapidly over the 1980s, to no more than replacement level (2.1) in 1989 [Monnier (‘ 19!9O)],

However, since 1983 there have been new develop- ments in a number of Member countries, Sweden’s total fertility rate rose sharply from 1.6 children per woman in 1983 to 2 in 1989, the fastest rise seen in OECD countries for at least twenty years. It may have risen further in 1990, and similar though smaller rises have occurred in some of the other Nordic countries. Even in western Germany, the fertility rate climbed from a record low of 1.3 in 1985 tu 1.4 in 1989’. Meanwhile, total fertility in the United States rose from 1.8, its level over much of the decade, to 2 in 1989. To some extent these rises are considered to be due to women “catching up” on births they had post- poned, a phenomenon which can be seen to a lesser extent in some other countries.

Fureign p ~ p u k t i ~ m grew a litlie faster, as numbers of refugees and asylum-seekem ruse From the beginning of the 1 9 8 0 ~ ~ the growth rate af

the total foreign (non-national) population in Europe began to increase, after two decades of general slow- ing, even of absolute decline. Zn 1989, the maximum proportion of foreigners in the total population was 27 per cent in Luxembourg and 15 per cent in

29

Page 2: INTRODUCTION OECD )I. of

Table 2.1. Net migration rates Average rates of net migration (entries minus exits) per thousand population for the periods shown

1963-72 1973-78 1979-82 1983-87 1988 1989

Australia Austria Belgium Canada Denmark Finland France Germany Greece Tmland Ireland Italy Japan Luxembourg Netherlands New Zealand Norway Portugal Spain Sweden Switzerland Turkey United Kingdom United States

7.8 2.2 0.9 3.1 1 .o

-3.7 2.7 7,2 -4.F -2.9 -0-4 -0.8 -0.1

6.9 1.6 2.0 0.7

-12.8 -0.7

2.4 2.0

-0s 1.5,

3.3 0.2 1.2 4.2 0.3

-1 .o 0.9 0.7 3.3

-2.7 4.5 0.v

4 . 1 7.4 2.4 1 *!I 1.1 6.7 0.4 1.5

-3.5

-0.6 1.8

6.7 0.1

-0.4 ’ 2.7 0.1 0.2 0.8 2.6 2.8

-0.3 -1,l 0.4 0.0 1.7 2.0 -2.7

1.1 -2.7 0.4 0.8 2.6 0.1

-0.4 3.0

5.6 0.9 0.0 0.8 1.3 0.7

0 3 0.P

-0.1 -6.2

1.6 -0.1

2.9 1.6

-0.2 1.7 2.3

-0.2 1.4 2.5 1.1 0.6 2.7

9.3 1.7 2.2 4.5 1.C 0.2 0.46 5.7 1.5’ 4.4

-10.0 1.3 4.2

5 3 2.7

-3.0 2.7 1.1

-0.6 3.0 4.6 0.1 0.3 2.7

9.1 4.1 2.2 5,3 0.6” 0.2 0.6

11.8 2.5 0.6

-10.9 0.9

4 . 1 6.9 2.1

-3.9 0.8 1 .0

4.4 5.1

4.1 2.6

a) Figures exclude 1988. b) Figures exclude 1987. c) Figures exclude 1972. dJ Figures exclude 1977.

Smme I OECD Labour Force Statisth, I959-J989, Paris, 1991.

Switzerland, while remaining under 10 per cent else- where in Europe [OECD (1989)]+ Over the last twenty years, migrants have tended to come from higher fer- tility countries. However, once settled in their new countries, they are strongly influenced by indigenous national behavlour and fertility differentials tend to decline? Indeed, the fertility of the foreign population drapped under replacement level in several countries,

Very broadly, while in the 1960s migration could be primarily c h a m terised as a search for empioyment and, in the 1 9 7 0 ~ ~ as, family reunion, in the 1 9 8 0 ~ ~ a continued increase in the flow attributable to family reunions was accompanied by a rapid growth in the numbers of refugees and asylum-seekers and, from the middle of the decade onwards, a significant spurt in the numbers of new immigrant workers. Remarkably, over the decade, virtually all QECD countries became countries of net immigration (Table 2.1). The southern European countries (notably Greece, Italy, Portugal and Spain) received major flaws of migrants from developing countries, from the middle of the decade on wards.

While migration added to the total populations of Member countries, it remained too low ts “rejuvenate” them by lowering the average age, especially given the tendency for migrants’ fertility rates to approach the overall average? OECD (1991, Chapter V) gives a

theoretical analysis of the impact of migration trends on population ageing. The conclusion is that it is highly unlikely that migration could be used to prevent a long-term decline in population, nor even its progres- sive ageing. Both would requite the admission of new migrants at a very much higher rate than seen over recent decades.

2. Medium-term trends in the labour farce and in participation

Labour force gruwlh S ~ Q W ~ X ~ in North America ,. Labour force growth over the period 1980-88 was, at

1.3 per cent, only slightly lower than the annual aver- age of 1-4 per cent recorded in the 1970s. The differ- ence was almost entirely due to the sharp decline in the growth rate in North America, from 2.6 to 1.6 per cent. For the QECD region as a whole, at least three quarters of the increase in the labour force could be attributed to the growth in the population of working age, the rest to changes in participation rates [UECD ( I. 990t.1, Table 1.1 )I. In some countries, migration played an important role. The female labour force grew about 50 per cent faster than the total (Table 2.2).

30

Page 3: INTRODUCTION OECD )I. of

. . : . a , > , i . . L . , I _. ..., , 1

Table 2-2. hbur force grawth, 1960-1989” Annual average growth rates in percentages

1950-70 1970-880 1980-89

Nortb America Canada United States

Centrat and Western Europe Austria &lgiurn France Germany Ireland Luxemburg Netherlands Switzerland United Kingdom

SoutBern Europe G t m Italy Portugal Spain Turkey

&& Australia New Zealand

1.8 2.6 1.7

1.3

0.4 -0.6 0.5 0.7 0.1 0.0 0.6 1.1 1.5 a 3

0.2 -1 .o -0.5 0.5 03 1 .0

0.7 1.3 0.2 2.0 0.7 0.7

2.7 2.8 2.2

0.3 Q.3 1.0

2.6 3.2 2.5

0.9

0.6 0.1 0.8 0.9 0.4 1.1 1.3 1.1 0.1 0,6

0.8 0.5 023 2.0 0.4 0.8

13 1.1 1.2 2.5 2.2 1 .Q

1*9 1 3 1.3

0.7 0.7 1.4

1.6 1.7 1.6

1.2

0.7 1.1 0.2 0.4 0,7 0.4 z,5 2.4 1.2 0.7

1.3 1.6 0.8 0.8 1.3 1.9

0.7 0.9 0,s 3.3 1.2 0.3

2*3 2.4 2.1

0.9 0.8 1.3

Females

1960-70 1970-80 1980-89

3.2 4.9 3.1

1.0

0.7 -0.7

1.1 1.4

-0.3 0.. 1 0.8 2.0 1.4 1.1

-0.0 -2.4 -1.2

4.2 1 .s 0.4

1.9 3.6 0.2 3+6 1.3 2.3

5.1 5.4 3.8

0.5 0.5 1.5

3.9 5.1 3.7

0.8

1.5 0.1 2.2 2.0 0.9 2.2 2.6 3.8 0.7 1.6

1.8 1.2 2.3 6.6 2.3 0.2

2.7 2.5 1.8 4.0 5.4 2.4

3.3 3.2 3.5

1.7 1.9 2.3

2.4 2.9 2.3

1.7

1.6 1.7 1.4 1.3 1.2 1 *2 3.0 5*1 1.7 1.7

3.2 3.9 1 *9 1.5 3.4 1.7

1.3 1.3 0.7 4.8 2.1 1.2

3.8 3.6 4.8

1.8 1.8 2.0

The general rise in female participation rates contin- ued over the 1980s, albeit at a lower rate than in the 1 9 7 0 ~ ~ . By the end of the decade the general pattern of the 1970s was still evident. The highest rates were found in the Nordic countries, followed by North America and the United Kingdom. Japan, Australia and New Zealand were near the top of the remaining countries, Ireland and the southern European countries (with the exception of Portugal) generally had the low- est rates (Chart 2.1 ).

These rises in overall female participation rates were driven by gains in the middle age ranges, particularly

among mothers with young children, For example, the Canadian participation rate of mothers with children under 3 rose from 32 per cent in 1976 to 56 per cent in 1986. For mothers with children between 3 and 5 , it went up from 41 to 62 per cent, and for those with children between 6 and 11, from 50 to 68 per cent [OECD (1990a, p.l25)]. The gap between the partici- pation rates of women with younger and older children thus declined in Canada, As shown in QECD (1990a, Chart 5.1) this appears to have been a general tendency.

The spread of participation rates of young people across the Member countries is wide, reflecting in part the different propensities to combine warking and edu- cation. Over the decade the rates for teenagers, espe- cially male teenagers, fell in mast countries, though

31

Page 4: INTRODUCTION OECD )I. of

Chart 2.1

Female labour farce participation rates a Percentage

Canada

United States

Austria

Denmark

Finland - Noway - - - - I

Switzerland

Sweden ...I.llt.L.IL.

I

Belgium

France

Germany

Iceland

G-4

70 72 74 76 78 80 82 84 86 3883

YO

90

8C

7G

60

50

40

30

2 cr 70 72 74 76 78 30 82 84 86 8889

0x3

90

8C

7Q

60

50

4c.

36

7i3 - -. 70 72 74 76 78 80 32 84 86 8889

a) Ratio of female labour force of ail ages to popuiation aged 15-84.

90

80

7c

66,

50

40

3c

20 _ _ 70 72 74 76 73 80 82 34 86 8889

5% 90

8Q

70

60

50

40

30

70 72 74 76 78 80 82 84 88 8889

90

80

76

60

45

30

20 _ _ 70 72 74 76 78 80 82 84 86 8889

1 Australia y _ _ P

Japan

New Zealand 3.-.1,-*

Greece

Italy

Po ftug al

United Kingdom

Netherlands

Luxernbou rg

Ireland

S O U P X OECD Labour Force Statistics, 1969- 1989.

Page 5: INTRODUCTION OECD )I. of

Chart 2.2

Participation rates of older men a Percentage

Australia Canada

Japan

New Zealand United States

70 72 74 76 78 80 32 84 86 8889

Yo

70 72 74 76 73 80 82 84 86 8889

YO

Finland

Noway Portugal

Sweden

70 72 74 76 78 80 82 84 €36 8889 70 72 74 76 78 80 82 84 86 8889

%a

United Kingdom - - - - -

Netherlands

Ireland Germany

CV

70 72 74 76 78 80 82 84 86 8889 -..

70 72 74 76 78 80 82 84 86 3339

a) Male labour force aged 55-64 djvjded by male population aged 55-64. b) Ages 60-64.

Page 6: INTRODUCTION OECD )I. of

Table 2+3. Trend in the share of foreigners or immigrants in the total labour force of selected OECD countries

Total population (thousands)

A. EUROPEAN CUlJIYTRIES

Share of foreign-barn pcmm in:

total population total labour €mix (percentages)

Total labour force (thousands)

1980 1989 1980 1989

Austria Belgium France Germany Luxembourg Netherlands Sweden Switzerland

3 315 4 155

23 374 27 217

159 5 406 4 318 3 176

3 454 4 217

24 274 29 774

I. 72 6 714 4 529 3 538

5.4 8.0 6.2 7.8

326 3.5 5.4

15.3

5.2 9.8” 6.5 6.6

2 8 3 2.9 5.2

17.9

u) Data for 1987. Sowces : OECD Labour Force Slolissics, 1969-89, Paris, 1991; and “!3SOPEMI 1989”, OECD Directorate for Social Maim, Manpower and Education, Pa&,

1990,

Australia

Canada

United States

1971 1931 1936

1971 1981 1986

1970 1980 1990

12 756 14 576 15 602

21 568 24 343 25 353

205 052 227 757 249 632

20.0 20.6 20.8

15.3 16.1 15.6

4.7 6.2 8 .3b

24.5 25.7 26.W

20.2 20.1 21.9

5.3 6.7

a] 1989. b) F%Q*iOnal results.

Suum : Censuses or labour force 8umy8, sec “SOPEMI 1989”, OECD, 1990.

Canada and Norway were cases where they rose signif- icantly. By the end of the decade around 60 per cent of Canadian teenagers were in the labour force. In France the corresponding figures were under 10 per cent for young men and under 15 per cent for young wc

... m the purficipatian of older men deched

Participation rates of older men (55-64) con

nen.

inued their decline, dropping to levels of under 50 per cent in several countries, including Finland, France and the Netherlands. However, the level in Japan was still over 80 per cent. In several countries there were signs of some recovery in the rates towards the end of the decade, perhaps reflecting moves away from policies to encourage early retirement (Chart 2.2) and stronger labour demand.

inflows of foreign workem, lower than in the 1 9 7 0 ~ ~ rose in the second hay of the 1980s

‘In several OECD countries, inflows of foreign wark- ers, while iawer overall than in the 1 9 7 0 ~ ~ ruse from the middle of the 1 9 8 0 ~ ~ coming both through regular channels (as temporary, permanent or seasonal work- ers) and illegally. In France, the United States, Spain and Italy, a substantial number of illegal immigrants were granted regularisation of their status [OECD (1989)]. However, the share of legal immi- grants in the total labour force remained stable in the European countries (with the exception of Luxembourg and Switzerland) while rising slightly in other countries (Table 2.3). Southern European coun- tries received substantially higher flows of immigrant workers from developing countries, employed mainly in agriculture, small-scale manufacturing and services.

34

Page 7: INTRODUCTION OECD )I. of

C. EMPLOYMENT AND PRODUCTIVITY GROWTH

Qverull output, empluyment and productivity growth ratesfQr the OECD area as a whole were similar tu thaw of the 1 9 7 0 ~ . The level of employment and unemployment is

strongly influenced by the state of the economic cycle and comparisons over time are best made over similar periods. For most countries, the 1980s may be roughly divided into two periods; a recession at the very begin- ning of the decade, foilowed by a long recovery - the longest of the post-war era - lasting almost until the end. As part of its cyclical indicators programme, the QECD Secretariat establishes a chronology of the dates of peaks and troughs for gross national product (see the Annex to this chapter). The dates for GDP

cluster roughly around 1979 or just after as a peak year, and 1983 as a trough, and, for the sake of sim- plicity af presentation, these are the years generally used for each country in this chapter. When appropri- ate, the decade is taken to be the period 1979-1989, considered as one complete cycle, and is compared with the previous cycle, 1973-1979. This ignores a cer- tain number of peaks and troughs identified in the period 1983-1987.

Comparing the 1979-1989 cycle with the previous one, 1973- 1979, reveals rather similar patterns of real output and employment growth for the OECD area as a whole, at around 2.8 per cent per annum on average far output, and 1 . 1 per cent for employment (Tables 2.4 and 2.5). As a result, productivity, mea- sured as real output per person employed, also grew at a similar pace during both cycles, at around 1.6 per cent per annum (Table 2.6). However, within

Table 2.4. Growth of real GDP Annual a.verage growth rates in percentages

1940-58 1968-73 1973-75 1975-79 1979-83 1983-89

North America Canada United States

Central and Western Europe Austria Belgium France Germany Ireland Luxembourg Netherlands Switzerland United Kingdom

Southern Europe Greecj: Italy Portugal Spain Turkey

Nordic countries Denmark Finland Iceland Norway SWedGn

Oceania Australia New Zealand

4.5 5.5 4 s

10.1

4.1 4.1 4.5 5.4 4.0 4.2 3 .o 5.0 4.4 3.0

5.9 7.3 5.7 6.6 7.5 5.8

4.3 4.4 3 3 4.6 4*4 4.4

4.9 5.0 3.0

4.3 4.3 5.2

3.0 5.4 3 .U

8.8

4.7 5.6 56 5.5 4.9 4,7 5.8 4-7 4.6 3.3

4.9 8.2 4.6 7.4 6.6 6.2

4.2 4.0 6.5 7.0 4.1 3,8

5*3 5*3 5.1

47 4.7 4.2

-0.9 3.5

-0.9

1.0

-0.2 1.8 1+3 1.4

-0.6 3.2

-1.3 1.9

-2.8 -1.1

1.6 1.1 1.3

-1.6 2.9 7.7

2.4 -0.8

2.1 3.6 4.7 3.0

1.8 1.8 2.4

0.0 0.0

4 . 4

4.3 4.7 4.3

4.9

3.5 3 s 2.8 3.5 3.9 3.9 2.6 3.0 1.1 2.9

4.4 5,o

5.5 1.9 3.5

2 2 3.3 2.4 6.8 5 .o 1.2

2.9 3.0

-0.9

3.6 3.6 4.4

4.9

0.7 1.1 0.7

3.3

0.8 1.4 1.3 1.5 0.6 0.7 1.1 0.1 3.5 0.5

1.6 0.6 1.7 2.0 1 .o 2.7

1.6 1 .o 3.4 1.9 2.5 1.1

1.5 1.5 2.0

0.9 0,9 1.3

3.9 4.3 3.9

4.6

2.9 2.5 2.6 2.5 2.8 2.2 4.7 2.7 2.8 3.4

3.2 2.3 3,l 3.2 3-8 5.3

28 2*1 3.8 3.1 3.1 2.6

4.5 4.5 1.8

2.9 2.9 3.9

1973-79 1979-89

2.6 4.3 2.6

3.6

2.2 2.9 2.3 2.8 2.3 3.7 1.3 2.6

-0.2 I .5

3.5 3.7 3.7 3,l 2.2 4.9

2.3 1.9 2.3 5.7 4.9 1.8

2.5 2.6 0.2

2.4 2.4 2.8

2.6 3.0 2.6

4.0

2.0 2.0 2.0 2.1 1.9 1.6 3.3 1.3 2.3 2.2

2.5 1.6 2.4 2.7 2.7 4.2

2.3 1.7 3.7 2.6 2.8 2.0

3.3 3.3 t .9

2.1 2.1 2.9

-

Aggresates were computed on the Wis of 1987 GNP/GDP weights expresswl. in 1987 US dollars. S w c e : OECD Econwnic 6Wftwk. Na 48, aecemtrtF 1990.

35

Page 8: INTRODUCTION OECD )I. of

Table 2.5. Growth a€ total employment Annual average growth rates in percentages

North America Canada United States

c m w d Wmmn Europe Austria kl@m Franm Germany Ireknd Luxemburg Netherlands Switzerland United Kingdom

ikxmia Australia New Zeaknd

1960-68 1968-73 1973-75 1975-79 1979-83 1983-39

19 3+1 1-8

1.5

0.3 -0.6 0.6 0.4

4 . 1 0.1

4 . 1 1.1 1.4 0.3

0.1 -0.9 -0s -0.3 0.6 0.8

0*4 0.7

-0 .3 1 *7 0.6 0.4

2.4 2.5 2.1

0.3 0.1 1.0

2.4 2.9 2.3

1 .o 0.6 0.2 0.6 1,l O S 0*1 2.9 O S 1.5 0.2

0.5 0.3

-0.3 0.6 0.9 1.2

1 ,0 1.3 0.9 2.9 1 ,0 0.7

2.6 2.7 2.2

0,6 0.5 1.2

0.7 2.9 0.5

-0.3

-0.8 -1.2

0,O -0.1 -2,l 0.3 2,o

-0.3 -2.5 -0.2

1.2 0-1 1.3 5.9

4 . 4 1.6

1.1 -1.4

1.3 2.6 1.6 2.3

1.2 0.8 3.0

-o*o -0.2 0.2

3.5 2.9 3.6

1.2

0-4 0.9 0.0 0.5 0.4 1 +6

-0.1 0.5

-0.1 0.4

0.4 0.9 0,7 097 -1.3

1.1

1.a 1.2 0.4 1.9 2.2 0.7

0 3 0.8 I . .0

0.4 0.3 1.6

0.5 0*7 0.5

1.1

4 .5 0.4 -1.1 -0.2 0.1

-0.5 0.1 -1.3

1.3 -1.6

0.3 1.7 0,4 1,6

-2. I 1.3

0.5 -0.3

1 .J 2.9 0.6 0.3

0.6 0+8 0.1

4.2 4.5

0.3

26 2.6 2.6

1.1

I*@ 0.6 0.7 0.2 03

-0.5 2.4 1.3 0,3 2.0

1.2 0.6 0*4 1.2 1.6 2.3

0.9 1.2 0.6 2.8 1 *o 0.9

2 9 3.4 8.4

1.1 1.0 1.6

1973-79 1979-89

2.6 2.9 2.5

0*7

0.0 a 2 0.0 0,3

4 . 4 1.2 0.6 0.3

-0,9 0.2

0.6 0.6 0.9 2.4 -1 .a

1.3

1.1 0.3 0.7 2.2 2.0 1.3

1.0 0.8 z -7

0.3 0.2 1.1

1.7 1.8 1.7

1.0

0.4 0.5 0.0 0.1 0.5

-0,5 1.5 a 1 0.7 0,6

0.8 1 .o 0.4 1.4 0.1 1.9

0.8 0.6 0.9 223 0.8 0.7

2.0 2.4 0.3

0.6 u.4 1.1

the OECD area, while the relatively rapid rate of pro- ductivity growth in Japan continued at around 3 per cent, there were changes in both North America and OECD Europe, resulting in some convergence between them,

... and the gap between OECD Eurupe and North Americu narmwed One of the striking features of the 1973-1979 cycle

was that, while average output growth in OECD Europe and in North America was similar, at around 2-5 per cent per annurn, North American employment growth was much faster, at 2.5 per cent as against 0.3 per cent. Productivity growth was thus close to zero in North America, as opposed to just over 2 per cent in

OECD Europe, Qver 1 979- 1 989 these regional differ- ences were less pronounced (Chart 2.3). Employment growth slowed in North America but improved in Europe and the gap between the productivity growth rates fell to 0.7 per cent. In the 1983-1988 recovery, this gap was even smaller (Table 2.6).

During the 1983- 1988 recovery, employment growth for the area as a whole was, once again, very similar to that seen in the 1975-1979 recovery, at 1.6 per cent in both cases. There was a significant deceleration of employment growth in North America, but the region still pasted one of the fastest rates over the recent recovery, at 2-6 per cent, a little behind Australia. OECD Europe recorded an employment growth rate of only 1.1 per cent, though this was considerably higher than the figure of 0.4 per cent recorded in 1975-1979.

36

Page 9: INTRODUCTION OECD )I. of

Table 2*6+ Growth of productivity (GIIP per person in employment) Annual average gmwtb rates in percentages

1960-68 1968-73 1973-75 1975-79 1979-83 1983-89

N o d America Canada United States

Central and Wmtm Europe Austria hlgium France Germany Ireland Luxembourg Net herlands Switzerland United Kingdom

soytbene Europe Greece Italy Portugal spain Turkey

Nordic Couaajes Denmark Finland iceland N~rway Sweden

u m d a Australia New Zealand

2s 2.3 2.6

8.5

3 3 4.7 4.0 4.9 4.1 4.1 3.1 3.8 2,9 2.7

5.9 8.3 6.2 6.9 6.9 5 .o 3.9 3.7 4.0

3.8 4.0

2.5 2-4 0.9

3.9 4.1 41

2.8

0.7 2+4 0.7

7.7

4.0 5.4 4.9 4.3 4.3 4.6 2.8 4.1 3.1 3.1

4.4 7.9 4.9 6.7 5.7 5.0

3.2 2.6 5.7 4.0 3.0 3 .O

2.7 2.6 2.8

dl 4.2 2.9

-1.5 0.5 -1.3

1.4

0.6 2.9 1.3 1.5 1.5 2.9

-3.3 2.2

4 . 4 -0.9

0.4 1 .o 0.0

-7,l 3.3 6.0

L3 0.6 0.7 1 .O 3.0 0.6

0 3 0 3

-0.6

0.0 0.2

-0.6

0.8 1.8 0.7

3.6

3.1 2.5 2.8 3.0 3.5 2.2 2,7 2.4 1.2 2.5

4.1 4.1 4.1 4.7 3.2 2.4

1.2 2.0 2.0 4 3 2.7 0.5

2.1 2.2

-1.9

3.1 3.3 2.8

0 2 0.4 0.2

2.1

1.3 1 .o 2.4 1.7 0.5 1.2 1 .o 1.4 0*2 2.2

1.3 -1 .o

1.3 0,3 3,2 1.3

1.2 1.3 1.9

-1 ,Q 1.9 0.8

0.7 1.9

1.1 1.4 1.0

1.3 1 +6 1.3

3.4

1.8 1.9 1.8 2.4 1.8 2.3 2.3 1.4 2.4 1.3

1.9 1.7 2.7 2.0 2.2 2.9

1.9 0.9 3.3 0*3 2. I 1.7

1.5 1 .o 1.3

1.8 1.9 2.3

0.0 1.4 0,o

2.9

2.2 2.7 2+3 2.5 2.8 2.4 0.7 2.3 0.7 1.3

2.8 3.1 2.8 0.6 3.2 3A

1.2 1.5 1.6 3.5 2.8 0.5

1.6 1.8

-1.5

2.1 2.3 1A I '

0.8 1 .1 0,9

2.9

1.6 1 .ti 2.1 2.1 1.4 2.1 1.7 1.4 1.5 1.7

P"7 0.4 2.1 1.3 2.6 2.3

1.6 1.1 2.7

-0.2 2,Q 1.3

1.2 0.9 1.5

1.5 1.7 1.7

Aggmgataa computed on the Wi of 1987 GNP/GDP weightg expressed in 1987 US dollars. Sotrrm : OECD E e c Oudd, No. 48, December 1990.

1973-79 1979-89

The fa!/ in average llnnual hours wurked sluwed The long-term decline in annual average hours of

work per person in employment slowed in several coun- tries during the 1980s. In some countries, including Canada, Japan, Norway and the United States, the trend levelled off while in Sweden it even turned upwards (Chart 2.4).

Making an adjustment for the changing trend in hours of work alters the relationship between the trends in productivity in the 1980s and 1970s. Because the downward trend in hours was stronger in the 197Os, it produces a larger upward adjustment in the 1970s than in the 1980s. While the overall trend in productivity over the two decades was slightly faster in the 1980s on the output per person measurep it was slightly lower on the basis of output per work-hour.

D. MEDIUM-TERM TRENDS I" UNEMPLOYMENT

The 1980s were u decode of high unemployment ... By historical, post-war standards, the 1980s were a

decade of particularly high unemployment. For the OECD area as a whole, the average unemployment rate for the years 1980-1989 was 7.3 per cent, com- pared with just under 5 per cent during 1974-1979 (and a similar figure over the whole period since 1960). Each Member country was affected by this rise in average unemployment from cycle to cycle, with the possible exception of Turkey,

Despite the long recovery, by 1989 the unemploy- ment rate in the majority of OECD countries was still

37

Page 10: INTRODUCTION OECD )I. of

Chart 2.3

Comparisons of cyckal changes in Europe and North America

1973-79 Growth of employment

Sources and nates:

See Tables 2.4,2.5, 2.6 and 2.7.

Unemployment (reversed scale)

3 979-89 Growth of employment

.. . . .

,. ... . . .C < - - + * < , - . , H H -,,,* r,..,....,..... ......... ,c- Unemployment (reversed scale)

QECD Europe

North America

Page 11: INTRODUCTION OECD )I. of

Chart 2.4

Average annual hours worked per person employed Index 1980=100

All employed persons 1 20

118

114

112

1 la

1 08

1 08

1 04

102

1 0c

98

95

94

92

Emplayees only 1 20

1 I@

1 I 4

112

I10

108

1 04

1 oa

1 OQ

98

98

94

92

9C

All employed persons f 20

114

112.

1 Ifr

108

106

1 02

100

98

- France Italy Spain

1 = - United States

- France Germany

a .. 0 ...*. Netherlands a - Spain 1 m - m - United States

a) There was a change in the method of calculating contractual working hours in 1987. Estimates fat earlier years have been linked to the new estimates using the ratio of new and previous estimates for 1987.

Sorrrce: Table L, Statistical Annex and for definitions. sea Annex 1 .I3 in OECD €m&wnenf . *

70 72 74 76 78 80 82 84 86 88 90 UUt~O~il990.

Page 12: INTRODUCTION OECD )I. of

North America Canada United Statcs

c e l l l lad wegtern Entrolp Austria &!lgiUm France Germany Iteland Luxembourg Netherlands Switzerland United Kingdom

slw4hm Eurrrple 43- Italy Portugal Spain Turkey

N d e cmntrb Denmark Finland NOrWaY Sweden

mads Australia New Zealand

Unemployment rate.

ti7 7.2 6.7

1.9

4.4 1-7 6.3 4,s 3.2 8.4

4.9

5.0

.. 6.6

5.2

2.6 5.8 4.4 1.8 1.9

*a

5,o

4.7 4.8 4.9

5.9 ?,4 5.8

2.1

4.8 1.8 8.2 5.9 3.2 "1.3

5.4

5.0

b.

7.6

8.4

3,1 5 3 5.9 2.0 2.1

.. 6.2

5.6 5.7 51

7.3 9.3 7.2

a s 8.5 3.7

10.8 9.0 5.9

15.2 1,6 9,7 0.3

10.0

12*9 23 9.5 7.3

17.5 6.2

3.2 8.9 4.9 2.7 2.5

6.9 7.5 5.1

9.2 9.6 7.3

5.4 7.5 5.2

2 3

7.3 4.3 8.1 9.4 5.6

17.8 1.4 8.3 0.5 7.1

31x4 3.1

10.9 5.0

16.9 6.0

2.8 9.4 3.4 4.9 1.4

6.3 6.1 7.1

8.6 9.0 6.2

lncidmxe of long-term unemployment*

188 1 -8P 1989 Average 1975-8Qs 19''

5 6 2.9 5.9

36.0

27.1

I*

28.4

.. 3.1 6.0

. I 7.8

.I .. ..

4.2 3.2 4.3

16.4

32.6"

6 1 9 32.6 28.76 3 3 2

3 5:sd

29.56

.. $1.2$

32.8

36.26 27.0

3.3 5.5

.. 19.9

31.56 32.r 26.e

9 3 3.3 9.1

16.4

46.0

703 43.6 45.0 62.7

51,O

44.4

60.0 43.0 64.6 53.7 55.4

19.8 31.6 183 7,7 9.1

3.

26.3

52.0 52.8 33.3

5-9 6.3 5.7

18.7

46.9 13.1 7 6 3 43.9 49.0 67.3

493

40.8

629 52.4 70.4 43.3 58.5

16.5 25.9 5.9

11.6 6-5

** 23.0

52.8 53.7 33.7

a) Standard& unemployment rates, from labour farce surveys, except in the: case of Austria, Denmark, Greece, Luxembourg, Switzerland and Turkey, where

b) Uncmploymmt for twlw months and wtr. Data am from household sumy sources, except in the case of Austria, whew registration data have been used. c) Or adjacent years. dJ 19'19. 8) Awmp of data for 1979 or 1980. Sowraf ; O K D Quurtcdy Labour F m e StaWks, No. 2,1991, for uncmploymcnt; Secretariat data bank for long-term unemplopont (see Statbtical Annex,

Tabb M and PI.

m3bttration data haw been Used,

higher than in 1979. Only Finland, Portugal, Sweden and the United States recorded noticeably lower figures and, in many countries, the figures were strik- ingly higher (Table 2.7).

The first edition of the Employment Uuthok, in 1983, observed that, at the time of writing, the outlook

for long-term unemployment was "extremely bleak". Since then, long-term unemployment has indeed risen, both absolutely and as a percentage of total unemploy- ment. It was one af the main features of the labour market of the 1980s.

In 1980 lang-term unemployment was around a quarter of total unemployment on average for QECD countries. By 1989, the corresponding figure was 34 per cent5 (Chart 2.5 and Table 2.7). For those countries where data are available on a consistent,

40

Page 13: INTRODUCTION OECD )I. of

internationally comparable basis for 1975- 1980 and 1.980- 1989, there is evidence of a substantial rise in the proportion of long-term unemployment from one cycle to the next.

The incidence of long-term unemployment remained much lower in North America; 6.8 per cent in Canada and 5 J per cent in the United States, in 1989, respec- tively. In North America the rate of flows into and out of unemployment is relatively high and most unem- ployment spells are short* Compared to many countries of OECD Europe, in North America job search and hiring are relatively familiar activities for workers and employers, respectively [UECD ( 199011, p. 1 3) 1. Nev- ertheless, there are some European countries where long-term unemployment remained low, In Sweden it was under 7 per cent of total unemployment in 1989. In Finland, the proportion dropped sharply to 6.9 per cent in the same year.

+.. youth und female umwipbyment rates, while still relatively high, moved cIOser to the uveml! told. .. The general increase in unemployment was accom-

panied by a convergence of the rates far youth and women towards the overall average. In 1989 unem- ployment rates of young people ( 1 5-24) were 1.9 times the rate for all ages, on average. This, however, repre-

sented a decline from an average of 2-2 in 1979. Youth unemployment rates actually fell over the period in some countries. The unemployment rates for women also tended towards the overall average, though remaining significantly higher than those of men in most countries (Table 2.8).

Partly owing to these changes in the structure of total unemployment, and to other changes in the labour force by age and sex, the composition of the long-term unemployed altered. In many countries the proportion of young people dropped sharply, halving in several cases.

... but, in Europe, foreign workers were badly uflected

Over the decade, the employment situation of for- eigners deteriorated in several European countries, notably Belgium, France, Germany and the Netherlands. In these countries, Germany excepted, foreign workers were less able than nationals to benefit from the increased employment opportunities towards the end of the decade. However, in non-European Member countries, such as Canada and Australia, immigrants recorded overall unemployment rates lower than the remainder of the labour force, though the rate varied considerably by country of origin.

Table 2.8. Changes in the structure of unemployment

Youth* unemployment rate R4

, 1939 (1979)

North A d a Canada United States

Central d Western Europe Francr: Germany Ireland Netherlands United Kingdom

Nordic cuuntrim Finland Norway SWdt3Zl

ol#anla Australia

11-3 10.5

4.5

19.1 3.1b 24.8' 11.4 8.6

33.5 11.4 32.0

6,l 11.5 3 .o

10.4

-- Ratio of youth to total unemployment rates

1989 ( 1979)

1.8 2.0

2.0

2.0

1 .St 1.2 I. -4

1.14

2.8 2.3 1.9

1.8 2.3 2.2

I .8

1989 ( 1979)

6.2 5.3

2.3

i 2.6 8,8&

12.3' 11.6 4.2

18.7 7,l

25.4

3.4 4.7 1.4

6.2

Ratio of female to total unemployment rates

1939 (1979)

1.1 1 -0

1 .o

1.3 1 3 0.7 1.2 0.7

1.6 1.4 1.5

1.0 I .o 1 .o

1.1

41

Page 14: INTRODUCTION OECD )I. of

Chart 2.5

Share of duration categories in total unemployment

100

9Q

80

70

60

50

4G

30

2(2

10

0 79 80 81 82 83 84 85 86 83 88 89 90

Denmark 1 OQ

90

80 70

6#

50

40

3.3

20

1G

79 80 81 82 83 34 85 86 87 88 89 90

Germany 100

90

aw 70

60

50

40

30

20 10

79 80 81 82 33 84 85 36 87 88 89 90

79 80 81 82 83 84 85 86 87 38 89 30

Finland

79 80 81 82 83 84 85 86 87 88 89 90

Greece

- 79 80 81 82 83 34 85 86 87 88 89 90

100

90

80

70

68

5G

40

30

20

10

0 79 80 81 82 83 84 85 86 87 88 89 90

France

79 80 81 82 83 84 85 86 87 88 89 90

Ireland 100

90

80 70

6Q 50

40

30

20

10

0 79 80 81 82 33 84 85 86 87 88 89 90

Under one month 6 to 12 months

SVUKIE See Statistical Annex, Table M.

Page 15: INTRODUCTION OECD )I. of

Chart 2.5 (cont.)

SOiiTCe: See Statistical Annex, Table M.

Italy

Under one month

1 to 6 months

6 to 12 months = One year and over

79 30 81 82 83 84 35 88 87 88 89 90

Norway

79 80 81 82 83 84 85 86 87 88 89 90

Sweden 1 oc 90

80

70

60

50

40

30

20

10

0’; 79 80 81 82 83 84 85 86 8’7 88 89 30

Japan 1

73 80 81 82 83 84 85 86 87 88 89 90

79 80 81 $2 83 84 85 86 87 88 89 90

United Kingdom

79 80 81 82 83 84 85 86 SS 88 89 90

Netherlands

73 80 81 82 83 84 85 86 87 8% 89 90

79 80 81 82 83 84 85 88 87 88 89 90

United States

n:‘ 79 80 81 82 83 84 85 86 87 88 89 90

Page 16: INTRODUCTION OECD )I. of

E, CHANGES IN THE INDUSTRIAL STRUCTURE OF EMPLOYMENT

Services took a higher prupurtion uf ~ t a i empluyment.. , The broad pattern of industrial change continued in

the 1980s. The overall proportion of employment rep- resented by the services sector ruse from 57 per cent in 1980 to 62 per cent in 1988. While in 1470, only the North American countries had recorded levels of over 60 per cent, eight countries reached this range by 1930 and twelve by 1988. The United States proportion was then over 70 per cent, while in western Germany and Japan it remained under 60 per cent (Chart 2.6). To some extent, this growth reflected the practice of con- tracting out service-type activity from firms in the manufacturing sector to firms in business services, which saw a particularly rapid expansion over the period.

... while the growth in guvernmmt employment slackmed On the other band, the trend in government employ-

ment over the 1980s marked a clear break with the past. Figures published in OECD (1990b) indicate a fall in the average growth rate from 2 per cent over the 1973- 1979 period to I , 1 per cent over 1979-1 988. The overall OECD average far the proportion of the employed population working directly for the govern- ment was slightly higher in 1988 than in 1979 (15.1 per cent as opposed ta 14-8 per cent) but the figure had dropped since 1983, when it was 15.4 per cent. These figures should be treated with some cau- tion, since part of the reduction in the pace uf growth of government employment may be more a question of definition than of real changes in activity.

F. NON-STANDARD FORMS OF EMPLOYMENT

The numbem and diversity of nm-stundard jobs increused Over the decade there was debate about whether the

incidence and diversity of non-standard forms of employment was growing, whether this might be due to high rates of unemployment and whether it might indi- cate an increase in the general insecurity, or “precari- ousness” of employment or, to use a term rnure com- mon in the United States, in the numbers of “contingent workers” [Rodgers and Rodgers (1989); 3elous (1989); Palivka and Nardone (1989)&

There has always been a wide variety of *‘non-stan- dard” jobs. They include part-time working, work involving a temporary employment agency, fixed-term

contracts, self-employment, “concealed employment”, home-working, seasonal employment and casual employment. A further sub-category is represented by temporary work designed by governments to aid entry into working life. The wide variety of such schemes is listed in OECD (1990a). And all these categories tend to overlap to a greater or lesser extent.

At the international level, data are rarely available on a consistent basis for a wide range of countries. Even for the major categories, such as part-time wsrk- ing and self-employment, where coverage is relatively good, the data are Far from comparable, Nevertheless, it is possible to build up a partial picture of develop- ments in the 1980s in three broad types of non-stan- dard employment: part-time working, temporary work- ing and self-employment.

3, Trends in part-time working

Part-time working increased in ahmr ull cuuntries.. . The proportion of part-time workers in total employ-

ment increased virtually everywhere over the 1980s. This applies to the two sexes taken together and to men, though the proportion of part-timers among emptuyed men remained under 10 per cent in all but a few cases (see Table 2.9, which, it should be noted, contains data relating to a mixture of definitions and is not suitable for making comparisons between COW- tries), Part of the reason for the increase in part-time working among young men was the spread of training programmes offering part-time employment,

For most countries, the proportion of part-timers among employed wurnen also rose, but there were declines in the Nordic countries, the United States and the United Kingdom (Table 2.9 and Chart 2 3 , In the Nordic countries, where the proportion of part-time working is the highest, the figures may have reached their peak around the beginning of the 1980s.

Part-time employment is by no means homogeneous. Biichtemann and Quack (1989), in particular, have drawn attention to the different employment patterns of workers assessing themselves as “regularyy or “mar- ginal” part-timers. “Regular” part-time workers in western Germany appear to have quite similar employ- ment patterns to full-time workers, while “marginal” part-timers are less stable, show less confidence in their job stability and are more often found in low-income families.

A related distinction i s between part-timers who work hours close to full-time workers and those work- ing relatively few hours. Part-time employment for a few hours per week may not be subject to tax or social security contributions and oEer littk or no security of employment [Rodgers and Rodgers (1989, p. 411. It represents an extreme form of flexibility for both employer and employee,

44

Page 17: INTRODUCTION OECD )I. of

Chart 2.6

Employment by sector

1 I I I 1 1

United States

Canada ;::: Netherlands i!:

Belgium lg80 1989

Australia ’ 980 1989

Norway ii:i United Kingdom

Sweden lg8* 1989

Denmark i::: Luxembourg 1 :z:

New Zealand izi: France lg80 1989

Finland :z:: Switzerland ’ 980 1989

Italy igg: Japan iigt

Iceland iiE: Germany ;:&

Ireland ::i: Austria izg:

Spain ii!z Greece i:::

Portugal

Turkey ;:::

Services: public sector a Services: other a) Ilata on national accounts basis.

UECD Labour Force Statistics, 1369-1989 and O€CD Economic Qufi4uk: Histor/-

...................... .............. .............. ............. sources: .~.~.~.1.~.~.1.~.~.-.-.1.-3 .............. Agriculture .............. Industry %.-A

Page 18: INTRODUCTION OECD )I. of

Table 2.9, Size and cornpsitiom of part-time emplaymmt, 1979-1990" Percentages

i

Part-time employment as B proportion of

1979 1983 1990

AWtXdiil Austria ~elgium Canada Denmark Finlandc Franc@ Germany Greece Ireland w y Japan Luxembourg Netherland# New Zealand NOnVay Portugal Spain Sweden

15.9 173 21.3 7.6 8.4 8.8b 6.0 8.1 10.2

12.5 15.4 15.4 22.7 23.8 23.7' 6.7 8.3 7.2 8.2 9.7 12.0

11.4 12.6 13,2f 5.5 5.5'

5.1 6.6 8.1' 5.3 4.6 5.78

15.4 16.2 17Ab 5.8 6.3 6 3

16.6 21+4 33,2 13.9 15.3 20.1 25.3 29.0 25.6

7.8 5.P 4.8b

23A 24+$ 23.2 United Kingdom 16.4 19A 21.8* United States 16.4 18.4 15.9

Male employment 1 Female employment ___

1979 1983 1990 1 1979 1983 1990

5.2 1.5 1 .o 5.7 5-2 3.2 2,4 1+5

2.1 3.0 7.5 1 .0 5.5 4.9 7.3 2.5

5.4 1.9 9.0

6.2 1 s 2.0 7.6 6.6 4.5 2.6 1.7 3.7 2.7 2.4 7.3 1 .0 7.2 5.0 7.7

6.3 3.3 10.3

3.0 1 ,@ 1 .76 3.1 9.W 4.4 3.5 2.1c 2.9 3 3 3.1b 8.P 2.e

15.8 8.5 8.8 3.1b 1 .ti& 7.3 5.P

10.0

352 36.4 40.1 18.0 20-0 20.v 16.5 19.7 25.0" 23.3 26.1 24.4 46.3 44.7 41.5" 30.6 129 10.2 16.9 20.0 23.8 27.6 30.0 30.P

12.1 10.3C 13.1 15.5 17.1" 10.6 9.4 10.P 27.8 29-13 31.96 17.1 17.0 15.1" 44.0 50.1 61.7 29.1 31.4 35.2 503 63.3 48+2 16.5 10,Ob

1 1,9b 46.0 4;,9 40.5 39.0 42.4 43.P 26.7 28.1 25.2

Women's share in part-time emphyrnent

1979 1983 1990

78.7 78,O 78.1 87.8 88.4 88.06 83.9 84.0 89.6* 72.1 71.3 71.0 86.4 84.7 79.4' 74.7 71.7 673 82.2 84.4 83.1 91.6 91.9 903

61-2 6S.TC 71.2 71.6 58.2' 61.4 64.8 64.78 70.1 72.9 73.W 37.5 88.9 80.0" 764 77.3 70.4 77.7 79.8 76.1

80.4 69.gb 77.2b

87.5 86.6 33.7 92.8 89-3 87.P 68.0 66.8 67.6

33.0 83.7 $1.8

Table 2.10 shows the change in the distribution of female part-timers in the services sector, according to their usual hours of work. There were considerable differences between the distributions for different countries. For example, the proportion of part-timers working mare than half-time is significantly higher in western Germany than in the United Kingdom. Despite the general rise in the numbers of part-time workers, the proportions in the various hours categories remained fairly stable over the recowrp,

2, Temporary working Temporary wurking increased rapidly in Some cuantries, while remainivzg low in other$. . . Temporary working comprises many subcategories,

including fixed-term contracts, employment with tem-

porary employment agencies, seasonal employment, casual employment, and certain types of government employment schemes, Precise information about tem- porary work contracts is difficult to obtain. In addition, as argued for example by Casey (1988), it may be misleading. In some countries, custom plays an impor- tant part in determining the length of employment actually offered, The identical employment contract may cover one case where the employment is under- stood, by both sides, to be permanent, another where both sides expect the relationship to be severed in the near future, and a third where the length of the employment relationship will. depend on economic con- ditions. Contracts which had been expected to be per- manent may be broken due to a change in employer policy, In the 198Os, this sometimes occurred in the public service,

46

Page 19: INTRODUCTION OECD )I. of

Canada

Jnited States .I.....**....*

Austria

Denmark a

Norway

Sweden .... *...*..*.*

8elgium

Chart 2.7

Proportion of women employees working part-time

v 7 0 72 7'4 76 78 80 82 84 86 88 90

%

% 65 60

5D 50 48

46 38 30

28

fi

' 7 0 72 74 76 78 80 82 84 86 88 90

"70 72 74 76 78 80 82 84 86 88 90

%

u770 72 74 76 78 80 82 84 86 88 90

YQ

Germany

u70 72 74 76 78 80 82 84 86 88 90 u70 72 74 76 78 80 82 84 86 88 90

Australia

Japan

Greece

Portugal ... ".**.**....

Spain

Ireland

Luxembourg

Wherfands

United Kingdom - - - - - - -

a) Break in series in 1084. b) Break in series in 1387.

Sources and dsfjnifions: See Table 2.9.

'

Page 20: INTRODUCTION OECD )I. of

... . .-.:. _.__ i__ , 4 , . , . . . ~ . . . . . . . . ~ 1 , , . I-.. ”. 8 ’ L . : . _ . .

Table 2,lO. Mstributian of wual hours a€ work of felnslb part-timers in services industriw 1988 (and 19-83) Percentages

- All hours

grow 1-10 hours 11-20 horn 21-24 hours 25-30 3% hours

9.9 (10.0) 15.7 (8.6) 11.9 (16,4) 10.1 (12.1) 9.3 (12.9) 21.8 (22,7) 12.3 (10.9) 31.7 (284 22.9 (..I 21.0 (*.I 23.3 (23.4)

61.5 (58,8) 30.0 (41-6) 43.5 (43.4) 51.0 (,.) 39.5 (19.3) 54.5 (43.8) 46*2 (47.4) 4QA (443) 51.5 (..) 51.6 (..) 44-1 (44.9)

9.8 (13-2)

9.6 (10.7)

7.4 (18.5) 10.3 (10.2) 15.3 (15.3)

8.4 (10.0)

11.0 (..)

8,7 (7.9) 11.0 (.,I 10-2 (.*) 123 (11.8)

11.3 (11.5) 34.1 (31.3) 20.5 (20.3) 23.1 (32.4)

9+9 (13.1) 16.6 (22.2) 11.6 (13.0)

166 (..) 14.8 (14.7)

30.9 (34.0)

10.0 (..)

7,s (5.5) 11.9 (7.9) 14.4 (9+2) 4.6 (5.3)

12.3 (15.3) 3.5 (10.0) 9.5 (4.3) 7.5 (59) 4.6 (..) 0.6 I..) 5.9 (5.2)

loo (100) loo (100) 100 (loo) loo (100) 100 (loo) loo (la?) loo (loo) loo (loo) loo (100) loo (loo) loo (100)

Sowkc : Data from the EURQSTAT publications of the E~ropcan Communities Lukw Forae Survey, 1933 and 1983. %hitions of part-time work are as used in tht sumy. Set Annex 1.B of OECD (19894 and Annex 1.C of OWD (1999). For the Netherlands, &€-a;psessment ki tbe criterion used.

No complete, systematic, international data on tem- porary ernploymen t exists over the whole of the 1 980s. However, there is some aggregate data from the co- ordinated Eurostat surveys for the period after 1983 (Chart 2.8). These figures should be interpreted with Some caution, as the underlying national questions dif- fer significantly. For example, in Belgium and Luxembourg, people are simply asked if their current situation is permanent or if they have a contract of limited duration. The Irish survey ash people whether they would describe their job as permanent or tempo- rary [OECD (1986a)j. In France, a series of questions is posed, including whether people have a fixed-dura- tion or seasonal contract or are apprentices under con tract

The general picture is of an increase since 1983 - especially in France, Ireland and the Netherlands (Table 2.1 1 ). For Spain, there was a particularly rapid increase from 16 per cent of total employment in 1987 to 27 per cent in 1989, following a change in legisla- tion. Apart from the southern European countries, the figure for the European Community lay generally between 5 and 10 per cent, For Sweden, the proportion of temporary employment in 1990 was 9.7 per cent, The incidence of temporary employment in public administration, which varies considerably from country to country, generally folbwed the overall trend for the country concerned. In Greece and Spain, the propor- tion of temporary workers in agriculture and corrstruc- tion had risen to around $0 per cent or over by the end of the decade.

Some national sources give information separately for two of the major components of temporary work- ing: temporary work contracts where the worker is employed by an agency, and fixed-term contracts con- cluded between employer and employee far a definite period of time.

In Belgium, the number of workers employed on temporary work contracts rose from the equivalent of 14 200 full-timers in 1985 to 25 000 in 1988 (0.6 per cent of total working days) [IRS (199O)I. In Canada, 57 000 workers were employed on temporary work contracts in 1983, 73 000 in 1985 and 63 QOO in 1987 (0.6 per cent of total non-agricultural employment) [Akyeampong tl989)j. In France, there was a strong increase in the activities of temporary work agencies over the 1980s. The annual number of contracts con- cluded with user establishments. doubled (from two million to four million) between 1979 and 1987. How- ever, the average duration of the contracts fell, so that the equivalent number of permanent full-time jobs felj from 240 000 in 1980 onwards, recovering only from 1987 to reach 280 000 in 1989, around 1.5 per cent of full-time equivalent jobs [Caire ( 1989); and TRS

In western Germany, temporary work contracts expanded significantly from the mid- 1970s and espe- cially at the end of the 1980s, from the equivalent of 41. 000 full-time workers in 1985 to 79 500 in 1987, representing 0.3 per cent of full-time equivalent jobs [Btichtemann and Quack (1989, p. 111); and IRS ( 1 S90)] +

In Ireland, the number of workers on temporary work contracts in the state sector rose from 6 500 in 1978 to 15 800 in 1983, before falling to 10 000 in 1986 [ElRR (1989a)l. In the Netherlands, the number of workers on temporary work contracts rose steadily from 25 000 in 1982 to 91 300 in 1988, 1.7 per cent of total full-time equivalent jobs [IRS (I 990)] I

In many other countries, including Denmark, Greece, Italy, Luxembourg, Portugal, Spain and Sweden, the volume of work represented by temporary work contracts, involving an employment agency, was

( I 990)17.

48

Page 21: INTRODUCTION OECD )I. of

Chart 2.8

Temporary jobs as a propar employment, 19l

[ion of total dependent 9 and 1989

10 20 30 ......................... 1

Spain

Portugal

Greece

Germany

Japan

Denmark

Ireland

Netherlands

France

Italy

United Kingdom

Belgium

Luxembourg

%

. . . . . . . . . . .

. . . . . . . .

. . . . .

. . .

. . . .

. . . . ' i

4 ,

. . . .

. . . . .

20 3r

Notes and sources:

3

1983 1989

SeeTabla2.11. I

Page 22: INTRODUCTION OECD )I. of

Table 2.1 1. Temporary jobs as a proportion of total wage and salary emplqmenf by industry, 1983" Perantages

Belgium 1983 1987 1989

Denmark 1985 1987 1989

France 1983 1987 1989

Germany 1985 1987 1939

Greece 1933 1937 1939

Ireland 1983 1987 1989

1933 1987 1989

Japanb 1983 1987 1989

Italy

Luxembourg 1983 1987 1989

1933 1937 1939

Portugal 1987 1989

1987 1989

1983 1987 1989

Netherlands

Spain

United Kingdom

5.4 5.6 5.1

12.3 11.2 9.9

3.3 7.1 8,s

1Q.O 11.6 13.0

16.3 16.6 17.2

6.2 8.6 8.6

6.6 5 4 5-3

10.3 10.5 10.8

3.3 3.5 3.4

5.7 9.2 8.5

17.0 18.7

15.6 26.6

5 s 6.3 5.4

7.7 7.0 6.4

19.8 15.0 13.9

5.1 10.1 11.5

21.6 24-4 17.4

51.1 60s 57*2

7.6 9.3

11.8

3 5 3 27 .O 28.1

24.5 25.0 26.7

8.5 8.6 9.3

10,s 20.3 13.0

37,2 31.6

39.4 49.6

11.8 10.2 7.1

1.9 1.8 1.8

3.6 7.9 3,€

2.4 2.3 2.6

4.7 6,O 6.6

5.3 5.2 s.l

3.2 3.9 4.2

2.3 1.3 1.5

2.8 3,2 3,s

1.7 1.1 0.8

3.4 4.4 3.7

7.3 10.3

4+3 8,2

2.0 2.8 3.1

2.2 2.8 2.2

7.1 2.2 3.5

2, i 3.2 7 ,O

6.2 6.9 5.8

9.5 6.3 7.9

2.3 3.7 4.7

0.9 2.0 2.0

0.0 0.0 0.0

1 .0 1.2 1.7

1.8 5.9 5,2

11.7 15.7

8.2 16.6

2.3 3.0 3.3

2.8 2-54 2-7

9 s 8.7 6.8

3.7 6.0 8.9

7.7 8.3 8.2

12.2 10.4 14.0

3.4 5.2 5.2

2.2 2.6 3.7

8.9 9.0 8.8

1.6 2.9 1.6

3.1 8.3 7.3

15.6 18.5

12.3 24,O

2.7 3.1 2.7

2,6 3,7 3.0

15.6 14.6 14.0

5 2 8.4 9.9

10.4 11.2 9.1

47.8 58.3 63.2

8.0 10.7 12.7

11.9 8.3 9.8

17S 15.1 14.2

3.5 2 3 3.6

3.9 4.9 4.7

31.1 29.0

29.5 49.4

6.9 6.9 4.4

6.9 5.4 4.9

15.6 15.2 13.1

6.0 8.9

10.9

I. 2.0 13.9 13.6

19.2 21.2 19,3

7.2 9.6

10.3

7.0 5.9 3.1

13.4 13.9 14.6

5.1 5.8 5.2

5.0 10.6 3.6

19.1 23.3

18.3 31.7

9.0 7.8 7.6

2.7 2.1 2.3

7.1 5.7 5.1

1.1 2.9 3.9

5.5 6.7 6.4

10.2 13.6 12.6

4.1 4.3 3.5

1.5 1.5 1.4

4.2 4.9 6- 1

2.7 1.4 I .3

3.6 6.2 5.9

6.3 3.9

7.8 15.9

2.2 2.7 2.7

4.1 4.4 3.8

7.2 7.6 6.2

3.8 6.5 7.5

9.0 10.0 10.1

10.2 7.7 9.9

6.4 1QA 6.0

1.9 3.8 4.3

3.6 4.6 4.9

I. .2 2.6 2.2

3.6 8.0 7.8

10.6 11.2

8.5 19,3

3.7 4.8 4. I

3.3 9.4 8.5

13.7 12.3 11.7

2.4 9.1 9.5

13.9 15.8 15.4

10.8 13.0 12.3

10.2 13.4 14.7

6.5

7.0

9.9 10.7 11.0

5.3 5.2 5.4

10.1 12.0 10.9

14.8 17.3

13.3 22+8

7.9 9 3 8.8

5.8

8.2 8,ci 8.6

14,4 11.7 11.9

0.7 6.3 5.9

12.4 16.2 15.9

3.0 2.0 3.0

3.1 4.8 1.9

2.3 1.9 2.3

6,7 5.6 5.3

2,7 233 2.7

5.1 6.2 7.4

9.1 9-8

7.7 10.3

4.0 7.4 3.2

rr) Data refer only to wag4 and ashy wwkm. All calculations exclude persons with a non-declad status. With tbe'cxoeption o€ the Unitcd Kingdom, the number with non-dcclarcd status was quite small,

b) The data are annual averages of tb monthly labur E m survey. Templrary employment is the sum of temporary employees (persons employed for a s ydd of a montb or more but not mom than a ycar) and day Lbourcrs @cnsons employed on a dail basis or far a specific perioa of lam than a m o n t h y g a ncst industry nomenclature is sli@t€y dierent from tht NACE systm ugcd in the Eurdpean dmmunity. Spe~ifically, business services art included in

o&r services, and public administraton refers to oycmmcnt, not elsewhere classified. Swuces ; Data far all countries exwpt Japan supplh! by EUROSTAT on the basis of the EC Laboav Fmm Swwp.

50

Page 23: INTRODUCTION OECD )I. of

either negligible 01“ non-existent, often reflecting pre- vailing legislation [IRS (1990); and Table 7.1 1 of this publication].

Regarding fixed-term contracts, concluded directly between the employer and the employee, the infarma- tion available shows quite sharp increases for France, Portugal and, especially, Spain, In France, the number of employees on fixed-term contracts rose from 3 15 000 in 1985 to 61 1 QOO in 1989, 3.4 per cent of all employees. In Portugal, there was a rise from 403 000 workers on short-term contracts in the fourth quarter af 1983 to 5 17 000 in the first quarter of 1988, 12,O per cent of all employees. In Spain, the increase was from 95 000 fixed-term contracts registered with the author- ities in 198 1, to 2 070 000 in 1985, and to 3 750 000 in 1988, 32 per cent of total employment. [See IRS (1990); and EIRR (1989b)J. On the other band, in western Germany and Italy,

the proportion o€ fixed-term contracts in total employ- ment seems to have been relatively stable in recent years, at around 5-5 per cent (in western Germany, 5 A per cent in both 1985 and 1988; in Italy, 5,2 per cent in 1986 and 5+8 per cent in 1488), following a period of expansion in the early 1980s [IRS (199O)j. In Finland, the figure appears to have been stable at around 1 1 per cent [Lilja el a/. (1990, Table 43)].

Over the decade, fixed-term contracts were increas- ingly used in recruitment. For France, Caire (1989, p. 79) reports that they accounted for 13.5 per cent of all recruitment in 1985 (20 per cent in commerce and services). For Luxembourg, a recent study quoted by EXRR (19894 refers to a figure of 15.7 per cent of total recruitment. Biichtemann and Quack (1 989) report that in western Germany one in four of fixed- term workers were given a permanent contract at the end of their employment term. However, in general their employment history was clearly less stable than that of permanent employees. Over a two-year period, under 60 per cent of initially fixed-term workers were found to remain continuously with the same employer, while the figure was 73 per cent for those with a per- manent employment contract at the beginning of the period. For the Netherlands, according to OSA ( 1987), there was a “considerable movement from temporary into permanent employment, though a sig- nificant minority retained their temporary status”.

On the other hand, in Some countries fixed-term contracts were increasingly implicated in flows into unemployment. For western Germany, Buchtemann and Quack (1989) report that the proportion of people entering unemployment after expiration of a fixed-term contract rose steadily to reach 18.4 per cent in 1987. For France, Caire (1989, p-88) indicates that fixed- term and temporary work con tracts together accounted for 47 per cent of all new cases of unemployment in 1987, compared with 31 per cent in 1979, the increase being due entirely to the rise in the number of fixed- term contracts. Fixed-term contracts are also associ- ated with seasonal employment. For Italy, the Decem-

ber 1989 issue of the EIRR reports that 70 per cent of fixed-term contracts related to the recruitment of sea- sonal workers.

... and the ntimber of foreign workers in temporary jobs incremed

Over the decade, the number of foreigners employed in seasonal work rose in QECD Europe, notably in Austria, Luxembourg, Switzerland and the Scandina- vian countries. In the non-European countries, Australia and Canada in particular, the inflow of such foreign workers was almost equal. to that of permanent immigrants. In certain industriaf sectors (for example agriculture, construction and services) , seasonal. or temporary work by foreigners played an important part in labour market adjustment.

3- Se Wemplo y went

In just over half of Member countries for which consistent data are available (10 out of 161, non-agri- cultural self-employment (employers and own-account workers together) took a bigger share of total employ- ment at the end of the 1980s than a decade earlier. In Finland, Sweden and the United Kingdom the rise was substantial (Table 2.12),

It appears that, at least up to the middle of the decade, any expansion of self-employment is largely to be explained by an increase in the number of own- account workers [OECD (1986a)j; the proportion of employers among the self-employed appears to have fallen. Rubery (1989), in a more recent analysis, has argued that this applied to the United Kingdom over the 1980s as a whole, It remains to be seen how many of these own-account workers will stay in business and how many will become employers.

... and womw swelled the ranks uf the self- employed For many countries the number of self-employed

women grew faster than the number of women employees. In several, including Finland, Italy, Norway, Spain, Sweden, the United Kingdom and the United States, the gap was substantial. In these coun- tries, the number of self-employed women (employers and own-account workers in the non-agricultural sec- tor) rose at an annual rate of around 4 per cent or more during the recovery. The rise in the proportion of women within self-employment was one of the more widespread changes of the 1980s (Table 2.12). The proportion of the under-25s in total self-employment has also generally tended to increase slightly over the past decade, or at least to have declined less than the proportion of youths in paid employment [OECD (1936a)].

Page 24: INTRODUCTION OECD )I. of

Table 2.12. Size and composition of self-employment?, 1979-1989 Percent ages

Total employment

1979 1983 1989

North A d r a Canada United States

Japan

-Central and Western Europe Austria Belgium France Germany Irelandb Luxembourg Netherlands Switzerland United Kingdom

SmithernEurope t3 Gteeceb

Italy Portugal Spain Turkey

Nordic countries lhnmark Finland Norway Sweden

ucm& Australia New Zealand

5.7 7.1

14.0

8.9 i 11.2 10.6 7.7

10,4 9.4 8.8 I

6.6

32.0 I 18.9 12.1 15.7

9.2 6.1 6.6 4.5

12.4 9.5

7.1 7*7

13.3

8.1 1 2 3 10.5

10*7 3.8 8.6

8.6

27,3 20.7 17.0 17.0 !

8.5 7.0 1 6.8 4 3 I

12,l

7.2 7.5

12.0

6.6 12.9 10.5 8.4

13.0 7.4 7.3

11.5

27.4 22.4 17.2 f 7.6

6.9 8.7 6.4 7.1

12.3 14.6

a) Non-agricultural, excluding unpaid family workers. b) 1988 in phce of 1989,

Source : UECD labour Farce Siatistics, 1959-89, Paris, 1991.

Self-employment as a proportion:

Male employment

1979 1983 1989

7.2 8.7

14.6

12.6

9.4

9.0

34.0 21.7

17.1

7.9 8.9 6.2

13.9

7.8 9.5

13.7

14.1

11.1

I 32.3 24. I

18.2

9.1 9.6 6.5

13.6

7.9 9.0

12.3

15.5

15.7

33.1 26.3

I 19.2

I 11.4 8.8

I 10.1

14.5

Female employment

1979 1983 1989

6.0 4.9

12.9

8.3

4.8

3+2

25.7 12.8

12.5

4.2 3.4 2.5

10.0

6.2 5.5

12.6

9.2

5.1

1 15.2 13.5

14.1

4.9 3.2 2.9

9.7

6.2 5.3

lo,$

9.0

6.3

15.1 15.1

14.1

5.9 3.5 3.9

9.2

Women's share in seelf-emplo)tme~~

1979 1983 1989

35.4 29.3

34.5

28,O

23.1

19.4

19.9 1 20.8

23s

33.1 21.4 25.4

29.3

37.5 32.3

36.5

28*4

249

15.3 *

21.2

24.9

34.2 21.0 28.9

30.8

39.0 35.5

35.8

23.5

24.6

f 7.2 23.3

25.8

33.5 25.8 27.0

31.1.

Page 25: INTRODUCTION OECD )I. of

The rise in the proportion’ af women in self-ernploy- ment has been much discussed, for example in OECD (199Oc)+ It reflects an increasing use of women’s entrepreneurial capabifities; high incomes for women are considerably more frequent in self-employment than in dependent employment. However, many self- employed women have low relative earnings [OECD (1988, Table 5-4 and p. 157)3, Self-employ- ment is very diverse, and it is likely that some women took up self-employment jobs which were both ill- remunerated and far from independent. The barriers against women becoming established in small busi- nesses are higher than for men, due to their compara- tive lack of training and relevant job experience and their greater difficulty in obtaining capital [Carter and Cannon (1988, p.2)]. Public assistance for women seeking to develop their businesses is generally directed at own-account working, as opposed to the develop- ment of businesses employing several people.

A correlation analysis reported in OECD (1986a) suggested little association between increases in self- employment and in unemployment: the level of non- agricultural self-employment was found to be gener- ally insensitive to the business cycle. This is no doubt partly due to the concentration of self-employment in the services sector and to the fact that a self-employed person can often reduce his or her rate of working rather than give up the job entirely. In addition, in some countries it may be common for employees to enter family businesses on losing their jobs.

G. “PRECARIOUSNESS” AND “FLEXIBILITY”

The evidence an nun-standard wurking mggest8 sowe increme in ‘yexibiiity * and ‘@recuriuusness ” , , , Qver the decade there was a sustained debate

around two inter-related themes; “precariousness”, or the possible decrease in the security of employment, and the “flexibility” uf the labour market, or its ability to adapt to change.

The type of evidence on non-standard forms of work- ing presented above is clearly relevant to the first ques- tion. For many countries there is good evidence of an increase in the two most common forms of non-stan- dard working: part-time employment and self-employ- ment. Neither can be necessarily assumed to be preca- rious, However, in parallel with the total increase, there does seem to have been an increase in the abso- lute numbers of part-timers usually working 20 hours or less. These part-timers are more likely to be without job security, Again, over the decade the composition of the self-employed population has changed and the pro- portion of women and young people has increased. Since these groups are relatively vulnerable on the labour market, this might also indicate increased precariousness.

For temporary employment, where there is no per- manen t employment contract, the pimu fucie supposi- tion of precariousness is stronger. There appears to be evidence of a rapid rate of increase in some furms of temporary working in a few countries. However, the overall number of temporary workers remains a small proportion of total employment in many others. Finally, the evidence for assessing a possible growth in other forms of non-standard working, such as con- cealed employment or home-based employment, is clearly lacking.

Of course, conclusions about precariousness cannot be settled simply by reference to non-standard forms of working, since it is quite possible that an increase in precariousness might occur without any overt changes in forms of working, simply as a result af changes in employer policy.

. +. but job-mobility and internal migrutim rates were not high International studies of labour market flexibility, for

example OECD (1986b), have referred to two types of mobility data: internal migration and job-mobility (external to the: firm). Occupational migration and mobility within enterprises are also of clear impor- tance, but cannot yet be treated statistically at the international level.

The 2980s do not seem to have been a period of high job mobility. On average, workers stayed longer in their jobs. The increase in average job tenure observed in the 1970s continued into at least the beginning of the 1980s [OECD (1986b, p. 551. At the same time, there was less movement between companies. Labour turnover rates tended to decrease at the beginning of the 198Qs, as they had done in the recessionary period after the first oil shock. In the following years, as the recovery began, mobility rates appeared to increase. However, by 1985 they had still not regained the levels of the early 1970s. The impression is thus one of a continuing long-term decline (Table 2.13). A more detailed analysis [OBCD (1986l1, Table 11-41] shows that quit rates, the voluntary component of separa- tions, tended to decline in several countries,

Gross internal migration flows, measured by the pra- partion of the resident population changing residence over the year, were also generally slightly lower over the 1980s than during the previous cycle (Table 2.14). This fits with a general pattern whereby, over time, high levels of unemployment are associated with lower internal migration levels [OECD (1 990q Chapter 3)]?

H. EARNINGS TRENDS IN THE 1980s

Qver the 198Os, most QECD countries experienced a prolonged period of disinflation in both labour costs and prices, In fact, the share of labour income in out- put fell to the lowest levels recorded over the past two

53

Page 26: INTRODUCTION OECD )I. of

Table 2.13. hbur turnover rates Annual number of accessions (A) and separations (S) per 100 employees

Japan United United Japan* Kingdoma State?

___

A S A S A S A S A S A S A S A S A S A S

1971 1972 4i 1973 44 1974 47 1975 40 1976 34 1977 29 1978 28 1973 35 1980 38 1981 36 1982 34 1983 36 1984 40

36 40 43 39 34 32 29 31 35 36 34 35 37

21

20 19 19 18 16

17

20

19 19 18 17 11

18

22

18 15 16 15 13

13

19

17 18 16 14 16

14

29 29 34 26 25 27 28 28 30 29 28 25

33 31 28 28 28 28 29 30 29 25

28. 29 33 18 11 15 12 11 14 12 9 8

29 26 26 17 14 15 14 12 13 15 15 14

20 19 20 17 14 15 14 13 is 15 15 14 14 15

20 19 19 11 16 15 15 14 14 14 14 14 13 14

18 17 19 14 11 14 12 11 13 14 13 13 13 14

19 18 18 17 15 14 14 13 13 13 12 13 12 12

2 i 22 19 14 15 21 21 13 14 IS 20

22 21 19 17 15 19 20 18 17 16 17

28 25 32 31 23 24 25 23 22 16 12 14 16 19

32 26 31 33 30 25 24 24 24 25 22 21 21 21

47 54 58 so 44 47 48 49 48 42 39

50 52 56 59 50 46 46 47 48 48 41

u] Manufacturing only, Nots that th$ figures gcncnlXy mfcr to turnover at establishment Lwl, including moves between establishments within the same enterprise. For at least Finhnd and Germany, howcvar, some moves within enterprises are not included, For all countries except France for the years 1971 and 1977-84, the rates refer to employees. S w m : Ste Annex A, OECD (198641.

Table 2.14. Internal migration in selected OECD countries: persons who changed region of residence in percentage of total populatiop

Australia Canada Finland Germany Italy Japan Norway Sweden United States

1970 3971 1972 1913 1974 1975 1976 1977 1978 1979 1930 1981 1982 1983 1984 1985 1985 1987

1.7 1.9 1.8 1.9 1,6

1.7 1.9 1.7 1.8 1.8 1.9 1S 1.5 1.6 I .6 1 .d

1 3 1 3 1.8 1-3 2.0 1.8 1.6 1.7 1.7 1.7 1,7 1.8 1 .8 1.5 1.6 1.5 1.5 1.3

2.5 1 .l 2.1 2+3 2 s

1.8 1.5 1.4 1.5 1 .ii 1.5 1.5 1.5

1.6 1.5 i .6

1 ,.4 1.2 I .3 1.3

1.8 1.8 1.7 1.7 1.5 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.2 1.1 1 .o 1 .a 1.1 1.1

1.1 1.1 1*1 1.0 0.9 0.8 0.8 0.7 0.7 0.7 0.7 0.7 0.7 0.6 0.6 0,6 0.6 0.5

4.1 4.0 3.9 3.9 3.6 3*3 3.2 3+ 1 3-0 3 .o 2.9

2.8 2.7 2.6 2.6 2.5 2.6

3.8 3.1 3.0 3.0 3 .o 2.9 2,7

2.7 2.6 2.7 2.6 2.5 2.5 2.4 2.4 2.5 2.6

4.3 4.9 4.3 4.5 4.0 3-7 3.9 4.0 3.5 3.4 3.4 3-7 3.9 40 3.9

1.2

1 .u 1.2

1.1

0.9 1.1 1.2 1,l

3.6 3.4

3.0

2.8 3 .o 2.7 2-8 3,0 3.0 2.8

a) Population 15 ytars old and over far Australia and the United Kingdam. Data exclude persons who changed country of residenw. Sauces .' Awtdia: Australian Bureau of Statistics, I n W d M i p t h , Awtdlu , various hues. Migration across 8 states and territories.

Cumdu: Data provided by Statistics Canada, Demography Division, Migration across 12 provinces and territories, Rtdad; Centrat Statistical OfROe, Statssricai Yewhook of Finid. Migration acms 12 provinces. Fratwe; JNSEE, data based on the yearly labour fur= surveys. Migration across 22 regions, Germany.- Statistisches 3undwmt, W k m ~ g und Enuerbslrrrigkei, Reihe 2.3, various issues. Migration across 11 Lander. !tidy: ISTAT, Cmpttdio Stutisrico Itdium, various issues. Japax Bureau of Statistics, Sfati&uf Y w h k various issues. Migration across 47 prefectures. Data derived from the Basic Resident Register. No~uay,. Central Bureau of Statistics, SfatWcal Ymrbk, Migration acrm 20 caunties. S w d m Statistics Sweden, Statisrical Abstrwi of Sueden, various issues, and Stutistiska maidelanden, BE 1984:4. Migration across 24 counties. Lldfed K h g d m Labour Force Survey data supplied by Jonathan Wadsworth of the Centre for Labour Economics. Migration across 10 regions, excluding Northern Ireland. United States: US, Department of Commerce, Bureau of the Census, GeograpMcul M&iIity: March 1986 to March 1987. Migration across 50 states,

54

Page 27: INTRODUCTION OECD )I. of

decades in many countries, although this was not uni- form across all industries. At the same time there was a levelling-off in longer-run trends in male/ female pay differentials and in the growth of the non-wage compo- nent of total labour costs,

Overall, there was a subslunbial siowduw in earnings growth,..

After the initial boost to inflation as a result of the second oil shock in 1979, there was a prolonged period of disinflation in both nominal wages and prices for most QECD countries (Chart 2.9). While in the 1970s there were several periods when nominal wage growth exceeded price increases by a considerable amount, the 1980s saw a narrowing of #he gap between wage and price inflation, This moderation in wage growth cam- bined with some pick-up in productivity growth resulted in real unit labour costsg in the business sector falling to the lowest levels recorded over the past two decades in many OECD countries (Table 2-15).

The severity of the recession in the early 198Qs, with its very high unemployment rates, had an initial damp- ening influence on wage and price inflation. Real wages (wages deflated by the private consumption deflator), which rose in the aftermath of the first oil shock in 1974, fell initially following the second oil shock in 1979 in a number of countries (most notably Australia, Austria, Canada, Greece, Japan and Sweden), With the resumption of growth, unemployment began to fall in many countries, Nevertheless, wage and price in&- tion remained subdued throughout the second half of the 1980s. There was some pick-up in wage growth in the late 1980s in Australia, Finland, Greece, Italy and the United Kingdom, but this was partly fuelled by food and energy price increases. It has been suggested that the moderation which occurred in wage growth throughout the 1980s marked a fundamental change in wage behaviour which cannot be explained simply by reference to external factors such as the collapse of oil prices in 1986 and depressed commodity prices in gen- eral or to demand pressure, For instance, it is possible that price expectations which are incorporated into wage claims may have changed in response to greater credence in the anti-inflationary policies pursued dur- ing the 1980s. In addition, workers’ wage claims may have become more responsive to prevailing rates of unemployment. The 1980s were also a period of reduced union militancy in must OECD countries with a strong decline in both union coverage of the workforce (see Chapter 4) and in the number of strikes, and this may have affected wage behaviour,

The empirical evidence for a fundamental change in wage formation remains, however, inconclusive. One common method of testing for such a change is to model the short-run Phillips curve relationship between nominal wage growth, price inflation and unemployment’0. Various tests of structural breaks can then be made, Studies by Chan-Lee et nI. (1987) and Poret (1990) give little support far the claim of a

change in wage behaviour in the 1980s compared to the 1 9 7 0 ~ ~ although the first study did find some ten- dency for observed wage growth in the 1980s to be more moderate than was predicted by the wage equations.

... with a particularly strong decline in real unit costs in mantcfaczuring. .. The decline in real unit labour costs in the 1980s

occurred both in the manufacturing and service sectors (Table 2.15), The divergence from trend in the manu- facturing sector was particularly marked in Australia, Denmark, Finland, the Netherlands, Portugal and Sweden. In the service sector, large falls were recorded in western Germany, the Netherlands and Sweden. However, in most countries, the fall in real unit labour costs from their peak in the early 1980s was greater in manufacturing than both in services and in the busi- ness sectors overall. (These comparisons need to be treated with caution as productivity measurement in the service sector is particularly open to a large degree of error.) In the manufacturing sector, strong increases in labour productivity in the 1980s were partly respon- sible for the deciines in real labour unit costs exper- ienced in Canada, Finland, Norway, Sweden, the United Kingdom and the United States.

... a kwliing-off ifi the rute at which fernole earnings caught up with those of merr... Over time, changes in simple average earnings data

are affected not just by changes in earnings but by changes in the composition of the male and female workforces and the kinds of jobs they do. One widely- available measure which avoids some, but not all3 of these compositional changes is the ratio of female to male hourfy earnings of manual workers in manufac- turing industries” (Table 2.16). For most OECD coun- tries there was a significant rise in this ratio over the 1970s which partly coincided with the introduction of equal pay legistation in a number of countries, How- ever, by the late 1970s this trend had slowed or come to a halt in a number o€ countries (including Australia, Denmark, Finland, Ireland, the Netherlands and the United Kingdom) and by the late 1980s earnings dif- ferentials were still considerable. In the two countries with the highest ratio of female to male hourly earn- ings, women were still receiving 15 per cent less than men in Denmark and 10 per cent less in Sweden, At the other end of the spectrum, in Japan earnings for women in manual occupations in manufacturing were only 50 per cent of those for men and, moreover, the ratio of female to male earnings appears to have fallen over both the 1970s and 1980s. Of course, these differ- entials reflect, to a great extent, the kind of composi- tional differences mentioned above. Detailed surveys show that, at a given age, length of service and educa- tional level, female earnings are between 70 and 90 per cent of male earnings [OECD (1988, Note C)].

Page 28: INTRODUCTION OECD )I. of

Chart 2.9

Wage gruwth, inflation and unemployment a

% North America

71 73 75 77 79 81 a3 85 87 39

Yo Nordic countries 25

20

15

5

71 73 75 77 79 81 83 85 87 89

0% Southern Europe 25

20

15

f U

5

71 73 75 77 79 81 83 85 87 89

a) Wage growth refers to business sector earnings and inflation to the ptivate

b) Denmark, Finland, Norway and Sweden. cl Austria, Belgium, Fmncs, Germany, Ireland, the Netherlands, Switmdand and the

d) Greece, Italy and Spain. Source: OECD Ecanomic Ouflook, No. 49, June 1991.

consumption deflator.

United Kingdom.

25

2G

15

10

s

Yu Central and Western Europe

71 73 75 77 79 81 83 85 87 89

% Australia and New Zealand

71 73 75 77 79 81 83 85 87 89

Wage growth

Inflation nernployrnent rate

Page 29: INTRODUCTION OECD )I. of

Table 2.15. Real unit labour costs in business (El, manufacturing (M) and services (S) sectorsu Average for period = 100

Australia

Canada

Denmark

Finland

France

Germany

Iceland

Italy

Japan

Netherlands

New Zealand

Norway

Portugal

Spain

Sweden

United Kingdom

United States

1970 1975 1930 1931 1982 1983 1984 1985 1986 1987 1988 1989

B 93.1 M 98.9 s 91.2 I3 104S M 106.1 s 98.2 €3 105.1 M 101.8 S 103.1 3 103.1 M 95.4 s 97.5 B 102.7 M 102.3 S 103-6 3 104.5 M 95.1 s 108.1 B M s €3 99.2 M 98.7 S 100.4 B 89.6 M 81.9 s 85.5 B 103.7 M 95.2 s 101.1 B M §

B 106.8 M 98.0 S 91.4 B M S B M S B 105.1 M 99.3 s 102.8 B 104.3 M 96.6 S 104.3 B 1023 M 102.4 5 99.5

103.2 1 10.4 101.7 100.8 100.3 100.1 104.3 103.0 103.5 106.5 10&7 106.7 1013 103 -0 99.7 105.3 101 m 1 106.3 103.2 109.3

105.3 109.8 105.1 104.1 105.7 103.0 108S 108.9 107.0 102.6 103.3 99.8 112.0 98.6

107.7

96.8

102.7 98.2 105.8 108.9 107.5 102.6 99.8 99.1 100.3

102.5 97.4 102.8 97.6 99+3 100.6 105.2 100.8 105.7 98.9 98.2 102.9 102.1 102.4 100.8 102.9 105.4 100.7 102.5 103.2 101,l 98,6 37.3 99-1 101.1 102.6 101.8 104.4 111.0 103.5 308.9 109.8 108.2 91,3 99.2 9-73 100,8 101 -0 100.2 i04,3 104.6 102.1 102.7 103.8 102.9 101-4 105.2 101.4 101.3 103.9 100.9

105-9 100,7 105.9 100.0 101.2 101.9 102.9 10 1.3 103.5 99.8 101.8 101.6 102.4 104.5 100.4 102.4 106,X 98.8 102.8 100.7 100.9 99.8 99.0 98.9 102.9 105.5 104.6 300.7 115.1 102.2 107.7 104.5 1065 83+5 103.9 95.6 102.8 102.1 100.0 104.6 104.8 102.8 101.9 107.1 99.2 101.5 107.1 104.3 100.3 102.1 100.6

108.0 102.5 107.0 101.9 108.9 103.1 99.3 98.1 103.6 98.6 102.5 99.5 102.1 104-2 101.7 99.8 104.7 96.3 101.2 105.8 97.6 99.7 99.6

100.1 102.6 105.1 103.3 98,2

108.8 100.4 104.7 104.0 103.5 88.7 104.9 95.3

100.5 103.9 99.2 1013 103.0 101.5 95.9 100.2 93.0 98.4

102-6 102.7 101.4 103.3 102.3

100.7 94.7 102.4 97.3 101.5 98.6 97.6 94.4 100.0 96-6 99.3 98.2 101.2 101.7 102.0 96.3 100.5 92.9 8 7 4 97.8 81,7 100.9 101,3 101.5 102.7 106.4 102.4 95.6 104.5 97.5 95.8 95.6 95.5 86.3 99.9 96.2 97.5

100.6 97.7 101.7 99,2

102.6 92.7 94.9 91.1 95.8 99.9

101.7 100.5 1 Q0.6 101.4

100.2 93.4

101.8 95.2 95.7 99.0 94.3 92.2 97.0 95. I 96.5 97-0 99.5 101.4 99s 95.1 100.1 91.7 86.5 90.0 86.6 98.2 97.8 99.0 101.6 104.1 102.6 90.8 96.7 94.0 93.0 91.2 98.5 84.0 96.2 97.2 95.4 91.1 99.5 94.9 95.1 95.7 91.5 91.8 92+0 95.8 99.3 103.9 98.9 97.9 101.2

99.5 91.8 101.4 96.2 95.5 lO0,O 93.8 93.3 95.7 961 98.3 97-7 98-0 99.1 99.5 94.4 98.7 92.0 93.9 99.2 97.2 97.6 96.9 98.6 99,7 103.3 99.8 89.8 96.4 93.4 94.1 97.3 98.7 85.7 97.5 99.3 82.7 87.2 35.7 92-8 93,3 954 93.3 93.3 94.1 94.8 96.4 100.8 98,4 99.4 99.5

100.0 93.1

101,9 97.6 95.6 93.5 93.7 94.9 94.7 96.3 99.5 96.9 93.6 93.6 95.0 93.6 96.9 92.3 943 88.6 103.4 95.3 95.5 ?4*8 99.9 104.3 100.8 91.7 90.1 93.6 98.3 96.4 95.7 96.3 99,6 98.8 89.6 84.0 98.2

91.9 90.8 93,6 95.8 94.9 98.1 97,9 98.6 98.3

97.0 90.7 98.7 97.4 93.6 99.8 97.7 982 100.1 34.7 34.0 96.5

93.8 99.5 91.3 102.0 98.4 109.9 95.9 95.2 96.5 100.2 103.4 102.4 94.8 93.2 93.4 99.5 100.5 98.3 98.5 100.2 100.8

93.1 92.5 94.4 94.3 93.2 377.1 98.0 97.5 99.4

95.2 87.6 96.4

94.9 94,9 97.1 93.2 91.3 96.4

92.3 98.3 90.0 101.0 39.2

101.9 96,O 93.9 97.4 99.6 101.7 103,O 93.3 88.0 92.3 95.9 97.2 94.6 99.5 97.4 49.6

93.0 93.3 93.9

89.9 95,3 90.3 91.5 92.0 95.4

91.3

962 95.9 97.8

90.3 85.9 90.1

91.2 94.7 94.8

94.6 94.5 97.1

aj The business sector refers to ali activities excluding “Producers of Government. Services and Other Non-Profit Producers” which are also excluded from the

Sources : OECD National Accounts far GDP, compensation of employees and employment series, For Canada and N e w Zealand, the employment series are taken from OECD h h u r Force Sraflsfics and are adjusted by excluding general government employment using estimates from the OECD Business Sector Data Base [(Ketse er a]. (1991)].

services sector.

57

Page 30: INTRODUCTION OECD )I. of

1 . ...,._ , - I . . , -.. - 2 , . .

Table 2.16. Ratios of fernah to male hourly earnings for manual workers in manufacturing Percentages

1970 1975 1980 1981 1982 1983 1984 1985 1986 1987 1988 €989

Australia 63.7 78.5 78.7 77.4 78.2 76.1 79.6 79.4 80.0 79.8 79.6 Belgium 67.7 71.3 69.7 72.5 73.5 74.4 74.5 74.3 74.1 74.7 74.5 Bnrnark 74.4 34.3 36.1 85.8 85,l 85.5 85.8 85.6 84.9 84.2 84.4 84.6 Finland 70.4 72.6 75,4 76.3 77.1 75.6 77.2 76.8 77.4 77-3 77.2 76.8 France 76.4 77.0 73.1 77.7 78.4 78.4 79.1 79.5 79.5 Germany 69.6 72.1 72.7 73-1 73-0 72.6 72.7 72.7 72.9 73.0 73.0 72.8 G r a m 68,O 69.5 673 67.2 73.1 74.6 76.2 77.6 76.9 77.5 78.0 Ireland 56.2 60.9 68.7 67.6 58.5 68.5 68.3 67.6 67.8 67.4 63.9 Japan 52.9 51.2 49.5 49.1 48.8 48.8 4 8 3 43.6 48.5 49.0 48.9 Luxembourg 55.4 50.9 61.2 60.1 60.1 61.5 59.6 62.6 60.7 51.6 58.4 Netherlands 71.8 79,2 80.2 79.3 79.2 79.2 79.0 77.7 78.7 77.6 78.0 Ncw-2dand 71.4 71.6 70.8 70.4 7Q,8 70.2 71.3 72.5 74.6 75.3 Norway 75.1 78,0 81.9 82,6 83.2 84.0 83.9 83.5 83.8 83.7 84.3 85.5 Sweden 30.0 35.2 89.9 90.1 90.3 89,2 90.0 39-8 90.4 90.1 90.0 89.5 Switzerland 64,7 56.0 65.4 66.9 67.0 66.8 66.9 67.1 67.4 57.3 67.5 United Kingdom 57,6 66.5 68-8 68.8 683 69.0 68.8 68.2 67.9 68.0 68.0 63.4

Sources : Japw Y'whk sf Lrrbotrr Smisties. &her mmtdes: ILO, Year W k of hhuw Stais#&s. See also Table C.1 in QECD (1988) for details of definitions and breaks in Series.

1970 1975 1980 1981 1982 1983 1984 1985 1986 1987 I. 988

Australia Austria Belgium Canada Finland France Italy Japan Germany Netherlands Norway Spain Sweden Switzerland United Kingdom United States

3.4 14.4 13.9 6.1

13.9 23.9 28.3

8.3 14.6 19.7 10.9 16.8 13-1 10,9 9.1

10.8

4.9 14.8 14,8 1.4

16.8 24.7 23.9 9.0

17.3 22.3 14.9 19.0 19.7 12.1 11.9 14-1

5.9 16.9 14.2 8.5

18.5 26.1 26.6 11.0 18.3 23.2 14,6 22.7 27.0 12.8 13.5 16.2

6.0 17.2 13-9 9.0

18.3 26.1 25.8 12.2 18.5 23.1 14.8 23.3 27.8 12.8 14.5 16.4

6.4 17.4 13.4 9.2

18.1 26.5 26.4 12,4 18.6 22.3 14.7 23.5 27.6 12.6 14.1 16.8

7.1 17.3 13.9 9.6

17.6 27.1 27.0 12.6 19.0 23.8 14.6 23.9 27.8 12.8 14.3 17.0

7.6 18.3 151 9.7

17.6 27.4 26.5 1x9 19.3 23.5 14.4 23.6 27.4 13.0 14.0 17.0

7.9 13.4 16.2 9.8

18.4 27.9 26.8 13.3 19.4 23.4 14.3 24.5 27.1 13.1 13.5 16.6

3.1 18.2 15+4 9.7

18.6 27.4 27.6 13.6 19.5 23.2 14.4 24.9 27.1 13.0 13.1 16.6

8.2 18.3 17.3 9.3

18.5 28.1 27.1 14.0 19.5 23.0 14.6 23.4 26.6 13.0 12.7 16.3

8.3 18S 17.5 9.9

18.3 28.2 27.1 14.1 19.5 22.6 15.1 23.2 27.2 13.0 12.4 16.3

Sources : OECD Natidnal Accounts and, for Australia, A S , Ausrralim National Accounts

So far, only developments in total earnings have been considered, However, these can be broken down into a wage and nan-wage component. Contributions by employers to social security and pension schemes are an important component of non-wage costsI2 and, as a share of total labour costs, rose almost continu- ously in most countries during the 1970s and first half

of the 1980s (Table 2.17). Thus, during this period, these non-wage costs provided an upward boost to earnings growth. However, in the second half of the 1 9 8 0 ~ ~ the share of these non-wage costs in total labour costs stabilized for a number of countries such as west- ern Germany, Canada, Sweden and Switzerland, and actually fell in the Netherlands, the United Kingdom and the United States, at least up to 1987. This has tended to offset wage growth to some extent in these countries.

58

Page 31: INTRODUCTION OECD )I. of

I. CONCLUSIONS

The period of the 198Qs, the decade just behind us, was more than a simple chronological interval. It cur- responded to a full cycle of economic activity, characterised first by a deep recession and then by the longest period of continuous economic expansion in the post-war period. It saw wide-ranging transformations, many of which, such as the increased prominence of non-standard forms of working, na doubt increased the capacity of QECD labour markets to adjust to struc- tural change, Indeed, the 1980s were marked by many positive features, notably the continuing rise in employment and the substantial wage moderation. Some countries made significant inroads into unem- ployment and long-term unemployment.

However, the legacy of the 1980s includes several, apparently contradictory features which may indicate that, within the labour market, some structural imbal- ances have bcorne more severe. At the end of a partic- ularly long period of recovery, when the proportion of people in employment rose to new heights, long-term unemployment remained a grave problem. Unemploy- ment remained concentrated on vulnerable groups with signs of deepening social malaise in some urban areas.

. _ . 4 - 1 “

Mobility levels were comparatively low, despite record numbers of young people and high levels of non-stan- dard working, both of which might have suggested the opposite,

At the beginning of the 19903, there are warnings of emerging labour supply constraints, and the certainty of a major change in the composition of new entrants into the labour farce, as the numbers of young people begin to decline. High levels of prolonged unempioy- ment have led to under-investment in and loss of human capital. To some exent, the increase in non- standard forms of working may also imply lower investment in skills for the longer term. Without policy action, all this may result in labour bottlenecks and skill shortages, and prevent labour markets from work- ing satisfactorily.

A preliminary poky conclusion is thus the need for intensified efforts to achieve structural reforms - to enhance the quantity and quality of the labour force, improve the efficiency of the labour market and com- bat exclusion. In particular it is clear that more train- ing and retraining will be required and that the “vin- tage” approach to renewing human capital - relying on equipping young people alone with the skills required for the new jabs and the new technologies - is no longer appropriate.

NOTES

1 +

2. See, for example, Business Week, February 1 I , 1991. The fertility of the same national group of foreigners tends to vary from one host country to another. Even where the fertility of foreigners is relatively high, socio- economic factors may be shown to explain the major part of the differences [OECD (1991, Chapter IIl)]. The actual impact an the total population depends partly on the naturalisation rate, which varies conside- rably from one country to another. The proportion of the foreign population granted naturalisation in f488 was over 4 per cent in Sweden, and between 2 and 3 per cent in Austria, Norway and Spain. The Netherlands, which has traditionally had a lower female participation rate than its neighbours, recarded a faster rate of increase in the 1930s. Figures are unweighted averages. Since the proportion of long-term unemployment tends to peak some time after unemployment itself, it is logical to use 1975, 1980 and 1990 as the basis for cyclical comparisons, whenever data are available. For 1980 the average is calculated for the fifteen countries for which data for 1980 or, alternatively, 1979 are shown in Table 2.7. The figure for 1989 i s calculated from the eighteen countries for which 1989 data are shown. It would be very similar (one percentage point kss) were the calcu- lation restricted to the fifteen countries covered in 1980. The changes that can be observed are generally bet- ween adjacent bands.

3.

4.

5.

6 ,

7.

8.

9,

10.

1 1 .

12.

59

Williams (1989) provides data on the pay and benefits offered to workers on the payroll of US temporary help organisations.

Of CQU~SC, regional migration is influenced by many factors other than unemployment rates.

Real unit labour costs are defined as real wages divided by productivity where wages have been deflated by the (business sector) output deflator. This measure can be shown to be more or less equivalent to the wage share in (business sector) output where the wage share has been adjusted to make an allowance for the labour income of employers and the self-employed which is assumed to be equal to the average wage received by all employees.

In fact, in the standard Phillips curve relationship, nominal wage growth is assumed to be a function of expected price inflation and the gap between the “natu- ral” or “full-employment” rate of unemployment and the actual rate, According to this relationship, a rise in expected price inflation or a fall in the rate of unem- ployment relative to the natural rate will lead to a rise in nominal wage inflation and vice versa,

See OECD (1988, pp. 151-163) for a more detailed analysis of male/ female earnings differentials.

For example, in European countries, employers’ contri- butions typically account for more than half of total non-wage labour costs [OECD (1986q Table 33)],

Page 32: INTRODUCTION OECD )I. of

Annex tu Chapter 2 PROVISIONAL PEAKS AND TROUGHS IN GROSS DOMESTIC PRODUCTu

Quarter and year

Peak Trough Peak Trough Fear

Australia Austria klgium Canada Denmark Finland France Germany Greece Ialand Ireland

Japan Luxembourg Netherlands New Zealand Norway Portugal Spain Sweden Switzerland Turkey United Kingdom United States

Italy

- 1 /80 i /SO

2/79 3/80

1/19

3 f79 1 /30 2/79

4/79

I /so 4/78 4/79

1/80 1 /80

3/43 1

2/79 4/78

4/80

1 180

- I. /SO

1 /SO

-

2/83 3/85 - 3/88 1/37 1/37 I

4/82 3/8 1 - -

4/32 2/83 3/33

2/83

2/82 1/83

3/82 2/84 2/85 1 /X3 4/82

2/83

4/33

-

- 3/87 1/85

.”.. 1 /S8 4/88 1 /89

3/82 4/82

Big Four Europe Major Seven EEC OECD Europe North America QECD total

1 /SO 1/80 1 /80 1 /so

1/80 4/78

2/ 84 4/82 2/84

4/82 2/34

4/82

aj Thaw dates may vary from those established by national authorities. They are derived from a wmmon methodology based on the “~3mwth-cycle~’ approach,

b) Provisional iden tifiat ion. Source : OECD Cyclical Indicators data bank,

explained in OECD (1987).

60

Page 33: INTRODUCTION OECD )I. of

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61