Dominik Enste
Transcript of Dominik Enste
Family Supporting Services in Germany
Prof. Dr. Dominik Enste, 11.11.2010, MadridCologne Institute for Economic Research
University of Applied Science CologneUniversity of Cologne
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Overview
The importance of FSS
The Supply of FSS in Germany
The Demand of FSS in Germany
The Market Volume
Policy Options
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Why are Family Supporting Services important?
Quality time for families in the "Rush hour of life"
Jobs for less qualified people (in households)
Legalisation of Illicit (undeclared) work
Why not "Do it yourself" (DIY)? More wealth as the result of the division of labour
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The market for FSS in Germany -Employees and WagesNumber of Employees in FSS (broad definition)Main Profession 666.193As a sideline 344.315Overall 1.010.508
Other professions 31.048.408
Source: SOEP, Own Caculations
Supply
Wage and Income
Other professions
FSS
Main Profession As a sidelineGross Income 2.200 1.250 100Gross hourly wage
13,03 8,65 7,50
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A Typical Supplier
Socio-economic attributes
Gender: more female
Age: relatively old employed persons (due to elderly men)
Nationality: no difference in relation to other professions
Main Profession: mainly women without specific characteristics in age and nationality; two-thirds of them live in a two-person household
As a sideline: mainly young, single women
Persons in marginal (precarious) employment occur three times more in FSS than in other professions
Lower qualification than in other professions
Supply
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Typical Demand
Single households as well as elderly people living in two-person households
Two-person household with children, both working; very high income, mainly academic background, long working-hours
Two-person households without children with relatively high income
FSS strongly depends on (high) income
Demand
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The market for FSSFewer demand in households with children Share according to types of household
6,7
3,64,5
2,4
11,2
6
0
2
4
6
8
10
12
Households with children underthe age of 16 years
Households without childrenunder the age of 16 years
Domestic help (on regular basis) Domestic help (occasionally) Total
Source: SOEP, Own calculations
Demand
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The market for FSSMedian equivalent income on the demand side(in brackets: Share of all households in per cent)
Domestic help employed on... AllOccasional
basisRegular basis households
Singles aged < 60 2,000 (0.5) 2,600 (0.7) 1,300 (20.5)Single aged 60 and > 1,400 (1.6) 1,600 (2.6) 1,224 (17.9)Couples without children 2,080 (1.2) 2,800 (1.9) 1,533 (29.3)Single parent 1,333 (0.1) 2,000 (0.2) 1,092 (5.3)
Couples with children1 child 2,222 (0.3) 3,000 (0.5) 1,430 (11.9)
2 children 1,619 (0.4) 2,850 (0.5) 1,377 (10.0)3 and more children 2,235 (0.1) 1,860 (0.2) 1,310 (3.3)
Total 1,680 (4.2) 2,090 (6.7) 1,350 (100)Source: SOEP, own calculations
Demand
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Different forms of employment
4%1%
95%
Undeclared employmentin 4 million households
Marginal employment in158,000 households
Employed personssubject to social secritycontributions in 39,000households
Source: own calculations according to TNS Emnid, 2007
Illicit workSelf-employedMinijobService AgencyHouse-keeping
Market Volume of FSS in Germany
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Full-time equivalence Gross Income
Legalisation of illicit work: 30 per cent 60 per cent
177,000355,000
2.8 Bn. Euro5.5 Bn. Euro
Demand according to preferences of Consumers: with an hourly wage of 8 € with an hourly wage between 10 to 12 €
594,000417,000
9.2 Bn. Euro8.1 Mrd. Euro
International comparison: EU 15 average EU leaders
304,000*) 727,000*)
4.7 Bn. Euro11.3 Mrd. Euro
MaximumLegalisation of 60 per cent the services currently provided through illict work plus realisation of existing consumer preferences with an hourly wage between 10 to 12 €
772,000 13.6 Bn. Euro
* employees
own calculations
Policy Options
Reduction of tax burden on labour costs
Immigration according to needs (through point system)
Supporting the development of a legal market for FSS
Less bureaucracy e.g. to support self-employment
Vouchers for Families (because of positive external effects of children)
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Outlook: increasing demand e.g. in Germany
Major job potential in private households
Demographic development: - 17 per cent among those:
aged between 70 and 80 years + 20 per cent
aged between 80 and 90 years + 154 per cent
aged 90 years and > + 301 per cent
2005: 25 Percent of the population aged 60 years and >
2050: 42 Percent of the population aged 60 years and >