5th german sino conference atypical employment in germany - recent trends and social implications

Berlin, 10.11.2010 Fußzeile 1

“Atypical” employment in Germany:

Recent trends and social implications

Dr. Sigrid Betzelt

Professor for Sociology of Work and Organizations

BLE / Faculty of Business and Economics

5th German-Sino Conference on Public Administration

Berlin, 14-17th Oct. 2010

2Prof. Dr. Sigrid Betzelt

Agenda

“Atypical” employment in Germany: Recent trends and social implications

1. The traditional employment model in (Western) Germany

2. Changed economic, social, and political conditions

3. Outcomes: Recent trends of “atypical”employment in Germany

(…and in other European countries)

4. Social implications

5. Conclusions: Political responses?

Berlin, 10.11.2010

Berlin, 10.11.2010 3Prof. Dr. Sigrid Betzelt

1. Traditional employment model in

Western Germany

A brief historical review:

1950s-60s: Specific historical conditions favouring labour

� Economic boom period in Western Germany

� Labour shortage � strengthened trade unions

� Welfare state: employment-based social security system

(Bismarckian social insurances)

� � Establishing a certain form of employment with strong

protection & social security as a „standard employment

relationship“:

Berlin, 10.11.2010 4Prof. Dr. Sigrid Betzelt

1. Traditional employment model in

Western Germany

The „standard employment relationship“:

� permanent employment (strong dismissal protection),

based on work contract with one employer

� full-time, normally 8 hours/5 days a week

� collectively agreed, living wages: breadwinner for family

� rule of seniority: upward mobility for senior workers

� full social security: full entitlements in public insurances for

old-age, invalidity, unemployment, health care (later: long-

term care)

Berlin, 10.11.2010 5Prof. Dr. Sigrid Betzelt

1. Traditional employment model in

Western Germany

This standard employment relationship:

� is a reference model for employment in Germany:

- characteristics seen as “best practice” of labour

- social security entitlements preconditioned to this norm

� empirical reality: only for large majority of male workers

� This form of employment is complemented by a

specific family model: “male breadwinner model”

� clear division of labour: women stay at home and care for

husband and children, husband is breadwinner

� women & children are socially secured by social entitlements

of husband (not in their own right)

Berlin, 10.11.2010 6Prof. Dr. Sigrid Betzelt

2. Changing economic, social and political

conditions

Challenges to the standard employment relationship:

Since mid 1970s:

� Economy: Recession, increasing unemployment, weakened

trade unions, firms’ demand for more flexible labour contracts

and lower labour costs

� Society: birth control, expanded higher education, social

movements

� individualisation, increased female labour market

participation

Berlin, 10.11.2010 7Prof. Dr. Sigrid Betzelt

2. Changing economic, social and political

conditions

� modernisation of family model: women in part-time

employment

� first “atypical” employment form matches both firms’

demand for flexible, low-payed work and greater female

economic independence

But: standard employment still predominating for men

Berlin, 10.11.2010 8Prof. Dr. Sigrid Betzelt

2. Changing economic, social and political

conditions

Since end 1980s, 1990s:

� Economy: more competitive & volatile markets

(globalisation), tertiarisation (new demand for services),

increasing unemployment, firms’ demand for flexible, low-cost

labour

� Politics: collapse of European socialist countries, German

unification, public budget constraints ?

� neoliberal paradigm

� deregulation of labour market: lower dismissal

protection, strong support of flexible employment forms

Since 2000s: Lower social protection against unemployment

Berlin, 10.11.2010 9Prof. Dr. Sigrid Betzelt

3. Recent trends of “atypical” employment

Outcomes of economic, social and political changes:

Standard employment relationship is eroding:

� empirically: decreasing shares of labour force,

though still majority of mid-aged men

� but still the reference norm in social security schemes

� raising social problems (section 4.)

Berlin, 10.11.2010 10Prof. Dr. Sigrid Betzelt

3. Recent trends of “atypical” employment

Source: Statist. Bundesamt 2008; Microcensus; sum smaller than single value because of multiple

employment in atypical forms; part time only defined as atypical if < 20 hrs.

Berlin, 10.11.2010 11Prof. Dr. Sigrid Betzelt

Different Data Base (German Socio-Economic Panel)

that includes part-time >20h:

37% of all employees “atypical“

(+12 percentage points since 1997)

• marginal employment doubled

• temporary agency work tripled

• fixed-term employment +46%

3. Recent trends of “atypical” employment

Berlin, 10.11.2010 12Prof. Dr. Sigrid Betzelt

Graph 2: Gender distribution of atypical employment 1997-2007

0

5

10

15

20

25

30

35

1997 1999 2001 2003 2005 2007

year

em

plo

ye

es

in %

men: part-time employees < 20hrs

men: marginal employees

men: fixed-term employees

men: temporary work agency employees

women: part-time employees < 20hrs

women: marginal employees

women: fixed-term employees

women: temporary work agency employees

“Atypical work” = still mainly women’s work,

but men are catching up

Source: Statist. Bundesamt 2008; Microcensus; sum smaller than single value because of multiple

employment in atypical forms;

part time only defined as atypical if < 20 hrs.

Berlin, 10.11.2010 13Prof. Dr. Sigrid Betzelt

Microcensus Data: 38% women „atypical“, men 14%

GSOEP (incl. all part-time): 57% women, 17% men

� 1997 – 2007: share of men in atypical empl. doubled

� Young, migrant, and low-skilled people are more often

employed “atypically“

� Working hours decrease, esp. for women, more

involuntary part-time (lack of full-time jobs)

“Atypical work” = still mainly women’s work,

but men are catching up

Berlin, 10.11.2010 14Prof. Dr. Sigrid Betzelt

Huge increase in low-wage employment

Federal Republic of Germany, 1995 and 2006 in Percent

Shares of low-wage empl.

within category

Changes in

low-wage

employment

Changes total

employment

1995 2006 1995-2006 1995-2006

Full-time 11.0 14.3 +12.6% -13.5%

Part- time 22.2 23.4 +24.5% +18.0%

Marginal emp. 86.0 91.7 +181.2% +163.8%

Total 15.0 22.2 +43.3% -3.1%

Source: Kalina/Weinkopf, IAQ-Report 2008-01; SOEP

6.5 million employees work for low wages, i.e. less than two-thirds of the

median wage: West 9.61 €, Ost 6.81 € (gross wages per hour, in 2006)

Berlin, 10.11.2010 15Prof. Dr. Sigrid Betzelt

Low wage employment: mainly female

More than two-thirds of the low-waged employees are

women (69%):

Low-wage shares across gender and working hours, in percent (2004)

Men Women

Full-time 10.8 21.8

Part-time 15.6 21.9

Marginal emp. 87.4 85.5

Total 12.6 29.6

Source: SOEP 2004, Kalina/Weinkopf, IAT-Report 2006-3

Berlin, 10.11.2010 16Prof. Dr. Sigrid Betzelt

Low wage sector no "springboard“: 80% of men, 90% women remain low-waged after

6 years of employment

Low upward mobility

Source: IAB-KB 8/2008

Berlin, 10.11.2010 17Prof. Dr. Sigrid Betzelt

Trends in self-employment:

Increasing

single-

person self-

employed

(without

employees)

Berlin, 10.11.2010 18Prof. Dr. Sigrid Betzelt

Trends in self-employment:

� Mostly single-person self-employed (without

employees) due to different “push”- and “pull”-factors

� More often not lifelong self-employment (transitions out

of and into unemployment or dependent employment)

� Very often rather low incomes (also for highly-skilled)

� No social security coverage!

Berlin, 10.11.2010

Atypical employment rate in Europe

1998 and 2008

19Prof. Dr. Sigrid Betzelt

Source: Schmid / Protsch 2009

employees and

single person

self-employed

Berlin, 10.11.2010 20Prof. Dr. Sigrid Betzelt

4. Social implications (Germany)

Trend towards erosion of standard employment has

problematic social implications, esp. in German

welfare system:

Certain (not all) “atypical” employment forms entail:

� low wages: no living wages, not even for individuals

� low opportunities for upward mobility and upgrading

skills

� low social security (low or no entitlements to social

insurance)

Berlin, 10.11.2010 21Prof. Dr. Sigrid Betzelt

4. Social implications

� affecting certain groups in such precarious jobs:

women, young people (also men), low-skilled,

migrants (from outside EU)

� life-course: more discontinuous employment

careers (periods of unemployment, atypical empl.)

� increasing social inequalities (“insiders / outsiders”)

and poverty risks

� increasing fears of “insiders” (middle class),

due to lowered social protection against

unemployment: threat of downward mobility

Berlin, 10.11.2010 22Prof. Dr. Sigrid Betzelt

5. Conclusions: Political response?

Erosion of standard employment challenges the social

security system (that still refers to it as a norm)

� raising poverty � burdening public budgets

� social security system has to be re-designed:

Idea of “flexicurity”

= combine flexible labour market with social security

e.g. include all “atypical” employment forms in social insurance,

or establish better (tax-based) social security scheme,

improve transitions between different forms of employment,

un- or non-employment (transitional labour markets)

Berlin, 10.11.2010 23Prof. Dr. Sigrid Betzelt

5. Conclusions: Political response?

“Flexicurity” idea is in the scientific debate for about

10 years,

on level of European Union also discussed as concept,

but not yet realised in most countries

Impediments: political power structures (employers’

power), public budget constraints?

Hope for future? Democratic legitimacy of governments

is eroding, but outcomes questionable?

Berlin, 10.11.2010 24Prof. Dr. Sigrid Betzelt

Thank you for your attention!