COMBATING PRECARIOUS WORK: MINIMUM …...Source: Broughton et al. 2016 In-work poverty in the EU...
Transcript of COMBATING PRECARIOUS WORK: MINIMUM …...Source: Broughton et al. 2016 In-work poverty in the EU...
COMBATING PRECARIOUS WORK: MINIMUM WAGES, TRAINING AND ACTIVATION POLICIES
Anke Hassel
WSI
Copyright rests with the author. All rights reserved
Precarious work in the EU
Alternative/ non-standard employment
In-work poverty
Low Pay
Precarious work in the EU
Alternative/ non-standard employment
In-work poverty
Low Pay
Open-ended full-time contracts and
open-ended part-time contracts:
relatively low risk of
precariousness.
Marginal and involuntary part-time
work, fixed-term work and
involuntary fixed-term
work, work and self-employment:
medium risk of precariousness.
Temporary agency work and posted
work: medium/high risk of
precariousness.
Informal/undeclared work and in
some cases zero hours contracts:
high risk of precariousness.
Source: Broughton et al. 2016
In-work poverty in the EU (in%)
0
2
4
6
8
10
12
14
16
18
20
Change of in-work poverty 2005-2015
-40-30-20-10
0102030405060708090
100110
Deuts
chla
nd
Slo
wenie
n
Zypern
Estland
Italie
n
Schw
eden
Spanie
n
Malta
Fra
nkre
ich
Lu
xe
mb
urg
Belg
ien
Öste
rreic
h
Tschechis
che…
Dä
ne
ma
rk
Un
garn
Griechenla
nd
Vere
inig
tes…
Lettla
nd
Litauen
Po
rtugal
Fin
nla
nd
Nie
derlande
Pole
n
Irla
nd
Slo
wakei
Low pay in the European Union, 2014 (by sex, in %)
0
5
10
15
20
25
30
35
Swed
en
Bel
giu
m
Fin
lan
d
Den
mar
k
Fran
ce
Ital
y
Luxe
mb
ou
rg
Po
rtu
gal
Spai
n
Au
stri
a
Mal
ta
EU2
8
Hu
nga
ry
Bu
lgar
ia
Slo
ven
ia
Net
her
lan
ds
Cze
ch R
epu
blic
Slo
vak
Rep
ub
lic
Cyp
rus
Un
ited
Kin
gdo
m
Irel
and
Gre
ece
Ger
man
y
Esto
nia
Cro
atia
Po
lan
d
Lith
uan
ia
Ro
man
ia
Latv
ia
Low Pay Incidence (men)
Low Pay Incidence (women)
Source: Eurostat, Structure of Earnings Survey 2014.
Low pay in the EU 2006, 2010 and 2014
0,00
5,00
10,00
15,00
20,00
25,00
30,00
35,00S
weden
Be
lgiu
mF
inla
nd
De
nm
ark
Fra
nce
Italy
Luxem
bourg
Port
ugal
Spain
Austr
iaM
alta
EU
27
Hungary
Bulg
aria
Slo
venia
Neth
erlands
Czech R
epublic
Slo
vakia
Cypru
sU
nited K
ingdom
Irela
nd
Gre
ece
Ge
rmany
Esto
nia
Cro
atia
Pola
nd
Lithuania
Rom
ania
Latv
ia
2006 2010 2014
Structural changes and challenges
The rise of alternative/non-standard work, in
particular part-time work
The persistence of low pay
The rise of in-work poverty
The heterogeneity of European labour markets
In-work poverty
Individual characteristics of the working poor:
Low skills
More blue than white collar workers
More younger than older workers
More migrants
More women (marginal)
Household characteristics:
More part-time
More unemployed in households
In-work poverty
Policy context
In-work poverty risks rise with
Higher wage inequality
Lack of public child care
Lower replacement rate of unemployment insurance
Stricter activation measures
Risk of in-work poverty and spending on ALMP
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
0 0,3 0,6 0,9 1,2 1,5
Ist-Wert
Red: unskilled and temporary
Blue: skilled and permanent
Risk of in-work poverty and sanctions
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
1,0 1,5 2,0 2,5 3,0 3,5 4,0
Ist-Wert
Red: unskilled and temporary
Blue: skilled and permanent
Low pay
Minimum wages can make a contribution to lowering the
low-pay incidence.
Minimum wages are most effective when combined with
strong collective bargaining institutions. Best results are
obtained in countries that combine high minimum wages
with high collective coverage.
The causal effect runs through wage compression, not
through the displacement of workers (as is often claimed).
Women workers are the main beneficiaries of minimum
wages.
Minimum Wages in % of full-time median wage, 2015
15
Source: OECD
Minimum wages and low pay
AUT DEU
DNK FIN
ITA
GBR
CZE
ESP
EST
LVA
SVK
POL
HUN
IRL
GRC
NLD
BEL
PRT
LUX
SVN
FRA
0
5
10
15
20
25
30
35
0 0,1 0,2 0,3 0,4 0,5 0,6 0,7
Low
Pay
Inci
de
nce
(to
tal,
in %
)
Kaitz Index (minimum wage / median wage) Note: Refers to long-run country averages. Only observations with valid observations for all relevant variables are included. Where no comprehensive minimum wage exists, the Kaitz Index is coded 0. For countries that introduced a minimum wage, observations prior to the introduction are excluded. Source: OECD Earnings Database.
R² = 0.261 (for countries with Kaitz ≠ 0)
Interaction between minimum wages and collective bargaining and low pay
AUT DEU
DNK FIN
ITA
GBR
CZE
ESP
EST
LVA
SVK
POL
HUN
IRL
GRC
NLD
BEL
PRT
LUX
SVN
FRA
0
5
10
15
20
25
30
35
0 0,1 0,2 0,3 0,4 0,5 0,6 0,7
Lo
w P
ay I
ncid
en
ce (
tota
l, in
%)
Interaction term (Kaitz Index × collective coverage)
Note: Refers to long-run country averages. Only observations with valid observations for all
relevant variables are included. Where no comprehensive minimum wage exists, the Kaitz Index is
coded 0.
R² = 0.736 (for countries with Kaitz ≠ 0)
Summary
Precarious work is a key challenge for European
labour markets
Precarious work is closely be related to in-work
poverty and/or the working poor.
Working-poor is influened by activation, childcare
and low pay.
Low pay is affected by minimum wage and
collective bargaining.
Redesign activation, invest in childcare and
address low pay.
Policies
Strengthen minimum wage floor and combat low
pay
Rethink activation: from work placements to
individual support and training
Improve vocational and further training
Enable and support female labour market
participation through child-care
Define minimum standards for non-standard work
(zero hour contracts, minimum hours, return to full-
time).
ANNEX
Risk of in-work poverty and activation measures
Red: unskilled and temporary
Blue: skilled and permanent
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
40,0
60 65 70 75 80 85 90
Ist-Wert
Interaction between minimum wages and collective bargaining and wage compression
AUT
DEU
DNK FIN ITA
GBR CZE
ESP
EST
LVA
SVK
POL HUN
IRL GRC
NLD
BEL
PRT
LUX
SVN
FRA
1
1,2
1,4
1,6
1,8
2
2,2
0 0,1 0,2 0,3 0,4 0,5 0,6 0,7
Low
er
De
cile
Rat
io (
D5
/D1
)
Interaction term (Kaitz Index × collective coverage)
Note: Refers to long-run country averages. Only observations with valid observations for all relevant variables are included. Where no comprehensive minimum wage exists, the Kaitz Index is coded 0. For countries that introduced a minimum wage, observations prior to the introduction are excluded. Source: OECD Earnings Database and ICTWSS Database Version 5.1.
R² = 0.779 (for countries with Kaitz ≠ 0)
References
Daniel Seikel and Dorothee Spannagel 2017: Activation and In-Work Poverty, in:
Henning Lohmann and Ive Marx (eds.): Handbook of Research on In-Work
Poverty. Edward Elgar.
Malte Lübker 2017: manuscript
Thorsten Schulten, Torsten Müller and Line 2015: Eldring Prospects and
obstacles of a European minimum wage policy, in: G. Van Guys and Thorsten
Schulten (eds.): Wage bargaining under the new European Economic
Governance - Alternative strategies for inclusive growth, ETUI, pp.327-359.
Andrea Broughton et al. 2016 Precarious Employment in Europe: Patterns,
Trends and Policy Strategies. Study for the European Parliament's Committee
on Employment and Social Affairs.