Post on 24-Feb-2016
description
Centre for Labour Market Research (CARMA)Aalborg University, Denmark
Beyond flexicurity: Labour market policy adjustments and welfare reform in Denmark in
the wake of the financial crisisMads Peter Klindt, Assistant Professor, PhD
Center for Labour Market Research (CARMA)Aalborg Universitympk@dps.aau.dk
Presentation at the MSE, Centre d’Economie de la Sorbonne, Paris
May 27, 2011
Agenda
• The Danish model of flexicurity as it was• Governance reform and policy changes in
2007/09• Rigging the ship: Small labour market
adjustments in the wake of the crisis outbreak • Changing the course: Debt crisis and new
reform agenda• Beyond flexicurity: New dynamics on the
Danish labour market
3
Denmark’s ‘Golden Triangle’ of flexicurity
Aktiv arbejds-
markeds-politik
Traditionelt samspil mellem fleksibilitet og sikkerhed siden 1899/1907 (1969)
Arbejdsmarkedspolitikkens trusselseffekt (2001-)
Opvalificering og omallokering (1994-2001)
Fleksibeltarbejds-marked
Generøse overførsels-indkomster
3
2007/09: Governance reform
Insured (unemployment
benefits)
Uninsured(means tested
social assistance)
Local government(91 Municipalities)
One-stop-shop jobcentres
Ministry of EmploymentState financesu.b. and
activation
Local gov.partly finances
social assistance
Local government take over full responsibility
(50/30 % of benefit payments
reimbursed)
Small adjustments during 2009
• Activation of young persons between 15 - 17• Immediate activation of people between 18-19
year old (ordinary education on ordinary conditions or job training on similar benefit).
• Stronger effort to combat long term unemployment among people aged18-30 (task force, screening of writing skills, regional planning)
• Altogether 500 mio. DKK
2010: Economic restoration plan
Unemployment benefits maximum duration cut from 4 to 2 years (1,3 billion DKK)Eligibility rules tightenedCVT-allowance reduced by 20 percentTax deduction for trade union membership fee reduced+ loads of other initiativesAltogether public spending cut by 24 billion DKK
2011: Reform package 2020
• Further initiatives to cut down public spending (23 billion DKK)
• Most importantly reforms of the early retirement scheme (efterløn) and old age pension
Retirement age will increase according increase in average
lifespan
Early retirement scheme will be reduced from 5 to 3 years and
become less attractive for people with labour market pensions
Incremental developments since the 1990s
• Falling UB compensation rates• Traditional trade unions loose members• Active labour market policy much more focused
on “work first”
UB replacement rates
0
10
20
30
40
50
60
70
80
90
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Bricklayer Average LO-worker Cleaning operative
Independent UB insurance funds in growth
0
50000
100000
150000
200000
250000
300000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Reduced use of ordinary education in the ALMP
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Total number of participants Participants receiving ordinary education Adult apprentices
Conclusion: Denmark beyond flexicurity