Workshop on the flexibility at the labour market

Flexicurity in EU

Ankara, 21 February 2011

Anette BjörnssonDG EMPL – Employment AnalysisEuropean Commission

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Overview of presentation

• Flexicurity in EU• Components of Flexicurity• Principles of Flexicurity• Flexicurity at the core of the EU policies• Flexicurity pathways• Flexicurity and Turkey• Flexicurity in times of crisis in EU MS

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Flexicurity in the EU

• The flexicurity is today one of the corner stones of the Europe 2020 being part of the guideline no. 7 and the flagship New skills and jobs

• The principles and methods behind the flexicurity policy can be found in the Communication 2007/0359

• Flexicurity is a well developed model in some EU countries like Denmark, the Netherlands, and Sweden.

Components

• – Flexible and reliable contractual arrangements (from the perspective of the employer and the employee, of ''insiders'' and ''outsiders'') through modern

• labour laws, collective agreements and work organisation;• – Comprehensive lifelong learning (LLL) strategies to

ensure the continual adaptability and employability of workers, particularly the most vulnerable;

• – Effective active labour market policies (ALMP) that help people cope with rapid change, reduce unemployment spells and ease transitions to new jobs;

• – Modern social security systems that provide adequate income support, encourage employment and facilitate labour market mobility. This includes broad coverage of social protection provisions (unemployment benefits, pensions and healthcare) that help people combine work with private and family responsibilities such as childcare.

Principles

• Involves flexible and reliable contractual arrangements

• Balance between rights and responsibilities• Adapted to the specific circumstances• Reduce the divide between the insiders and

outsiders • Internal as well as external flexicurity should be

promoted• Support gender equality• Climate of trust and dialogue between public

authorities and social partners• Contribute to sound and financially sustainable

budgetary policies

Guideline 7 of the integrated guidelines

• Increasing labour market participation and reducing structural unemployment

• integrate the flexicurity principles with a view to – increasing labour market participation– combating

• segmentation and inactivity, • gender inequality, • whilst reducing structural unemployment

The components of guideline 7

• introduce a combination of • flexible and reliable employment contracts, • active labour market policies, • effective lifelong learning, • policies to promote labour mobility, and• adequate social security systems to

secure professional transitions accompanied by

• clear rights and responsibilities for the unemployed to actively seek work.

Undeclared work important

• tackle labour market segmentation with

• measures addressing temporary and precarious employment, underemployment and undeclared work.

Flagship ‘An agenda for new skillsand jobs’

The four main priorities:

• New momentum for flexicurity

• Equipping people with the right skills for employment

• Improving the quality of work and working conditions

• Supporting job creation

Flagship ‘An agenda for new skillsand jobs’

Flexicurity: 10 proposed priorities:

• Focusing on the reduction of segmentation in the labour market (EPL).• Weight on internal flexibility in times of economic downturn (EPL)• Improving access to lifelong learning (LLL)• Adopting targeted approaches for the more vulnerable workers (LLL) • Enhancing stakeholders' involvement and social dialogue (LLL)• Establishing effective incentives and cost sharing arrangements (LLL)• Adapting ALMP mix and their institutional setting to reduce LTU (ALMP)• Reforming unemployment benefit systems to adjust to business cycle

(SSS)• Improving benefits coverage for those most at risk of unemployment (SSS)• Reviewing the pension system (SSS)

The 4 pathways

• 1: Tackling contractual segmentation

• 2: Developing flexicurity within the entreprise and offering transition security

• 3: Tackling skills and opportunity gaps among the workforce

• 4: Improving opportunties for benifit recipients and informally employed workers

Pathway 1: Tackling contractual segmentation

• Characteristics:– Main problem is the segmentation of the labour

market into insiders and outsiders– The new more flexible working contracts

create a trap keeping the employees in short-term contracts

• Proposed solutions:– Need for more ALMP– Need for more resources at the PES– More focus on the people experiencing

frequently unemployment spells– LLL for people working in short term contracts

Pathway 2: Developing flexicurity within the entreprise and offering transition security

• Characteristics– The labour market is characterised by low job rotation– The economy is usually characterised by big companies

which are creating higher job security

• Proposed solutions:– Better opportunities for flexible arrangements– Better cooperation between the stakeholders at the

labour market– LLL important at company level– PES to focus on long-term unemployed– More conditions related to the payment of

unemployment benefit

Pathway 3: Tackling skills and opportunity gaps among the workforce

• Characteristics:– high employment rate– But specific groups like women, younger, older

workers are excluded from the labour market

• Proposed solutions:– LLL very important in order to increase

education level– PES’ role is to clarify the education level

thereby focusing the ALMP on the most urgent needs (it should be more efficient to employ low-skilled)

– More focus on primary education.

Pathway 4: benefit recipients and informally employed

• Characteristics:– Countries that have experienced economical reforms– Many people are receiving social benefits which can be

characterised as labour market exit benefits– Investment in ALMP is limited– Gender specific differences exist– High informal sector

• What needs to be changed:– New job opportunities for unemployed– Decrease/stop informal work

• Tools suggested are – ALMP focusing on education and lifelong learning– Benefits that have an adequate size

Main conclusions from an ETF report on flexicurity in Turkey

• Turkey is on the way to use the flexicurity principles

• Main obstacles are– The large informal segment of the labour

market– The fact that many people (from the formal

segment) are receiving social benefits, e.g the many people receiving benefits for early retirement

– The very low participation rate for women– The high share of low-skilled people in the

workforce

Flexicurity in the times of crisis in EU MS

Many Member States have • temporarily introduced new publicly sponsored short-time

working arrangements, or have increased their level, coverage and duration, and made their use more manageable (increased internal flexibility)

• strengthened unemployment insurance systems (i.e. the level of benefits, their duration, and their coverage for new groups).

• Active labour market measures have increased, including business start-up incentives, training and work experience programmes.

• Public Employment Services provided more targeted job-search assistance for particular groups such as young people, immigrants, workers on short-term contracts, the newly redundant, or those not receiving benefits.

• In some countries, employment services raised their staffing levels by 10% or more to cope with the rise in the number of job seekers.

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Thank you for your attention

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