Public policy and European society

University of Castellanza

Session #2(b)Blocked Societies?

The crisis of continental corporatism and the success of the Scandinavian model

11 November 2009

Outline

Euroscelorosis?» Europe has less people at work than the USA –lower

employment» But some European societies have very high levels of

employment Blocked societies (France, Germany, Italy)

» Low employment, inflexible labour markets Scandinavian success

» High employment, flexible labour markets and high social welfare!

France as new model?

‘Euroscelerosis’: Fewer Europeans than Americans at work

Employment ratePercentage of potentially active population who have some job.Activity rate: Percentage of potentially active population who are at work or looking for work.Unemployment rate:Percentage of actually active population who are without a job.NB Definitions!

Lisbon Declaration

Lisbon targets» 70% overall employment» 60% women» 50% older workers

‘Arbeit macht frei?’» But many societies and groups have ‘chosen’ low

employment rates, sometimes with high productivity Economic citizenship

» justifies employment» ensures work compatible with social reproduction

Employment rates 1997-2006

50.0

55.0

60.0

65.0

70.0

75.0

80.0

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

EU27

Germany

France

Sweden

Denmark

Italy

Greece

Ireland

UK

Source: Employment in Europe 2007

Overall participation

Divergence greatest in core age group Two extremes:

» High Scandinavia, low Mediterranean

Activity rate:

% of populatation 15-64

Activity rate % of pouluation aged 25-54

France 62.7 78.7

Germany 64.2 78.0

Italy 47.9 60.3

Sweden 75.8 85.5

UK 68.3 76.4

EU15 60.9 73.2

Employment statuses 2006

0%

20%

40%

60%

80%

100%

UK Denmark Italy France

Employed Unemployed Inactive

Full-time or part-time

Home duties

Studying without part time work

Early retired

Prison (Important in USA)

Source: Employment in Europe 2007

Forms of women’s participation

Countries with high overall participation have very different forms of participation Deregulated labour markets = ‘bad’ jobs?

Part time as % all employment

Hours worked: difference- households with and without children

Marginal part-time as % all dependent employees

France 29.4 -1 9

Germany 36.4* -3.3 18

Italy 16.9 +2 8

Sweden 33.1 +0.1 6

UK 43.9 -6 21

EU15 33.5 -3.4** 14**

Three worlds of welfare – and ‘defamiliasation’

Liberal regime» Market solutions» Deregulated labour market-» Immigrant caring labour» Part-time and temporary work for women

Social democratic» Extensive care services:» Good low skill employment» Enable women to leave home

Conservative/ corporatist» Subsidiarity so family important» Insurance based benefits» Priority of full-time work

Mediterannean (?)» As conservative but incomplete coverage

Which countries?

UK and Ireland

Scandinavia

France and Germany

Italy, Spain, Greece…

New member states?

Changes?

Employment Protection Legislation – laws that make it difficult and/or expensive for employers to dismiss employees

Blocked societies

Insider/outsider labour markets» Low employment rates» High unemployment» High youth unemployment

Ineffective third level education» Disconnection from labour market (low returns to education)» Long duration» Low research

And in Italy:» Low female employment » Corruption

A new France?

Nicholas Sarkozy Ségolène Royal

Scandinavian flexicurity

Flexicurity•Activation•Retraining and life-long learning•Protect the worker, not the job•Low Employment ProtectionResults•High employment rate•High job mobility (‘flexibility’) and effective job search•Firms can innovate without employment problemsBUT needs high trust and is expensive!

Scandinavian successes

Family and social services– Extensive good quality services (especially childcare) enable

women to participate in employment by moving ‘women’s jobs’ outside the home

– Social services provide good quality caring jobs (largely for women)

– Contributes to relatively high birth rate and egalitarian household division of labour

– BUT public sector/private sector gender divide High and continuing education

– High overall levels of education (no US or UK ‘tail’) – The basis for innovative enterprises through links to commercial

R&D– Creates flexible workforce

New strength of ‘Continental’ ‘conservative regimesExtensive automatic stabilisers (welfare)Acceptance of state regulation and intervention

A continental solution?