Czech Republic: Working conditions of young entrants to the labour market

  • Observatory: EurWORK
  • Topic:
  • Job quality,
  • Published on: 18 Prosinec 2013



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Young labour entrants, together with elderly workers, belong to disadvantaged groups in the labour market in the Czech Republic. High unemployment rates and the wide-spread use of fixed-term contracts for such workers imply lower levels of employment security in comparison to other groups of employees. This tendency is even more pronounced in the case of young women and entrants with low levels of educational attainment. Highly-educated labour entrants tend to have fewer problems finding employment, but the job position often does not correspond to their qualifications and is often only part-time. The Government is attempting to address the problem of the unemployment of young people, but the issue of the quality of jobs offered to them remains somewhat neglected.

QUESTIONNAIRE

This EWCO CAR is specifically focused on the group of “young entrants to the labour market”. This group includes all young people (between 15 and 30 years old) who have recently entered into the labour market (i.e., people with a work experience shorter than 1-2 years in the labour market), with relative independence of their age and for whom work is their main and core activity. This definition excludes young people for whom studies are their main activity but who combine their studies with some remunerated activity as part of their training programmes (e.g. apprenticeships in dual systems), as well as unemployed young people, even if they are actively looking for a job (see Background note for more detailed information on the concept of young entrants to be considered in the research).

The CAR coordinating team is conscious that such as “narrow” definition of “young entrants to the labour market” can make difficult the identification and collection of relevant information on the topic. Therefore, and in the case no national information is available using this “narrow” definition, National Correspondents can use a “proxy” definition of “young entrant to the labour market” as any young person (i.e. between 15 and 30 years old) who is in employment, irrespectively of the number of years of experience that he/she has in the labour market (again, unemployed young people are excluded from the analysis).

The questionnaire focuses on the following topics:

  • General description and characterisation of the main current working conditions of young entrants to the labour market in your country in comparison to other age groups (around 700 words)

  • Identification and characterisation of existing differences in working conditions within the group of young entrants to the labour market in your country (around 600 words)

  • Evolution of working conditions of young entrants to the labour market in the last five years. Effects of the economic crisis (around 500 words)

  • Initiatives taken by national governments/social partners in order to improve employment levels and working conditions of young entrants to the labour market (around 500 words)

  • Final commentary on the main results (around 100 words)

Block 1: General description and characterisation of the main current working conditions of young entrants to the labour market in your country in comparison to other age groups

NCs are kindly requested to provide the most updated information (coming from national surveys, administrative registers or ad-hoc national research/studies) on a number of working conditions-related variables specifically related to young entrants to the labour market in comparison to other age groups. Please provide the information only for those variables where significant/important differences, either positive or negative, can be identified in relation to other age groups, stressing the causes and rationale of these differences

Suggested extension of this section: around 700 words

1.1 Career and employment security issues

In comparison with other age categories young workers are most at risk of unemployment. Indeed, according to the Labour Force Survey (LSF), unemployed young people aged 15 – 29 represented 32.4% of total unemployment in 2011, although only 48.6% of those in this category were economically active and that workers of this age made up only 18.5% of the total labour force.

Table 1: Employment rates and economic activity in different age categories (in %)

Age categories

15-29

30-44

45-59

60+

Labour force as percentage of total population

48.6

88.2

85.8

11.4

Employment rates (percentage of employed in the total labour force)

88.2

94.5

93.9

97.1

Source: Czech Statistical Office: Labour Force Survey 2011

However, young entrants are less likely to remain unemployed over the long term in comparison with older age categories. Indeed, in 2011, 31.3% of unemployed people aged 15-29 and 29.2% of young unemployed aged 15-24 experienced long-term unemployment as compared to 41.4% of those unemployed aged 15-59.

With regard to employment status, young people work relatively more often as employees: 88.7% of workers aged 15-29 and as many as 90.3% of workers aged 15-24 worked as employees in 2011 compared to 81.9% of the overall working population. This applies especially to women who generally tend to work more as employees than do men; in 2011 as many as 91.5% of working women in the age category 15-29 worked as employees. The proportion of those self-employed, which amounts to 8.7% in the age category 15-24, increases with age in a similar way to the proportion of employers; a category which is practically non-existent among workers aged 15-29:

Figure 1: Employment status by age


Source : Czech Statistical Office: Labour Force Survey 2011

Young entrants to the labour market are among those who are considerably more often employed on the basis of a fixed-term contract. Whereas this type of contract makes up only 7% of employment contracts on average, the proportion of those aged 15-29 working on such contracts amounts to 13.4%. Nevertheless, fixed-term contracts are even more common (19.4%) with regard to workers aged 60 and over, e.g. working pensioners.

Furthermore, the youngest workers in the employment market work slightly more often in part-time jobs than their older counterparts; however, the difference between age categories is not significant in this respect due to the generally low number of those with part-time jobs in the Czech Republic (just 5.5% of employees). Nevertheless, in certain sectors young entrants are more likely to work in part-time jobs than other employees (with the exception of workers aged 60 and over who consist to a large extent of working pensioners, which is reflected in the high share of fixed-term contracts and part-time jobs in this age category). The highest share of part-time employees among workers aged 15-29 was found to be in the educational sector, in which 20.5% of young employees worked part-time in 2011 (compared to an average of 12.2% in this sector overall), and the professional, scientific and technical sector in which 12.6% of young employees worked part-time (sector average: 10.5%). In accordance with these figures, young people working in professional positions worked part-time more often (in 10.6% of cases) than other young workers.

Since wage levels usually depend to a considerable extent on the level of experience and length of employment, young workers tend to have lower salaries than their older counterparts. This is reflected in the number of young workers receiving only the minimum wage, which amounts to CZK 8,000 (EUR 310) per month for a full time job (40 hours per week) and CZK 48.10 (EUR 1.86) per hour. The percentage of employees who receive up to 8,800 CZK (340 EUR) per month amounts to 2.8%; however, workers aged 15-21 earn up to this amount in 4.6% of cases (Duspivová 2012).

1.2 Skills development

With respect to the participation in vocational training activities, there is no significant difference between young workers and other age groups.

1.3 Health and well being

The youngest age group of workers is more vulnerable to occupational injury than other age categories are, but the period of incapacity for work is significantly shorter than the average. Therefore, the average percentage of incapacity for work is on average lower in the worker age group 15-17 than in the total working population:

Table 2: Juvenile incapacity for work due to occupational injury in comparison to the average in 2012
 

Juveniles (15-17)

Total working population

No. of newly notified cases / 100 insured persons

1.25

0.99

Average % of incapacity for work due to occupational injury

0.085

0.148

No. of calendar days of incapacity for work / 1 newly notified case

24.71

54.94

Source: Czech Statistical Office: Incapacity for work due to disease or injury 2012

These figures would tend to indicate that a considerable proportion of young employees work in unsafe environments; on the other hand, minor employees are protected from working in certain potentially dangerous work positions such as transportation services, certain positions in the construction sector etc. with a high risk of serious (or even fatal) injury.

1.4 Reconciliation of working and non-working life

The “youngest” sector in terms of the share of young employees was accommodation and catering where it is typical that employees work rotating shifts. Indeed, employees aged 15-29 made up 30% of the labour force in this sector in 2011, while on average they constituted 18.5% of the labour force. Since such a working regime generally find it difficult to reconcile working and non-working life, older workers, particularly those with children, tend to leave the sector, thus rendering the proportion of young entrants in the sector higher than the average.

Block 2: Identification and characterisation of existing differences in working conditions within the group of young entrants to the labour market in your country

NCs are kindly requested to provide the most updated information (coming from national surveys, administrative registers or ad-hoc national researches/studies) on differences of working conditions within the group of young entrants to the labour market, for a series of variables. Please provide the information only for those variables where significant/important differences, either positive or negative, can be identified, stressing the causes and rationale of these differences

Suggested extension of this section: around 600 words

2.1 Personal characteristics of young entrants

LFS data suggests that young women are employed considerably more often on the basis of fixed-term contracts than young men. While the percentage of men aged 15-29 with fixed-term contracts amounts to 10.9%, women from the same age category work under this arrangement in 17.2% of cases. This difference is even more significant in the group of young workers with the highest educational attainment: women who have attained some kind of tertiary education qualification work in 18.1% of cases on the basis of a fixed-term contract, whereas men from the same category in only 9.6% of cases. This can be explained by the unwillingness of employers to conclude permanent contracts with young female employees who are expected to interrupt their careers for several years due to maternity and parental leave, and who, should they have a permanent contract, have the right to return to their job position up to three years following the commencement of maternity/parental leave . In certain sectors young women make up the largest group of employees with fixed-term contracts, e.g. in the construction and in the professional, scientific and technical sectors. In contrast, equal working conditions for young men and women in terms of type of contract were identified in the education and arts, entertainment and recreation sectors.

As for working hours, women tend to work generally shorter hours than men. However, in the lowest age categories, the difference is quite significant in the case of those self-employed. It can be assumed that young women opt to work for themselves so as to have more flexible and often shorter working hours (employment contracts usually do not allow a high level of flexibility), whilst men tend to pursue different motivations.

Figure 2: Weekly working hours of those self-employed aged 15-24 by gender (in % of self-employed men/women)


Note: Those self-employed who have worked within the last four weeks.

Source: Czech Statistical Office: Labour Force Survey 2011

Accordingly, women tend also to work part-time more often than men, except in those sectors with a generally high share of young part-time employees: 26.1% of men aged 15-29 work part-time in the education sector compared to 19.2% of women, and 14.9% of men in the same age category have part-time jobs in the professional, scientific and technical sector compared to 10.3% of women. Young men in professional positions work part-time in the same proportion as young women, i.e. in 11% of cases.

As regards the share of fixed-term contracts in relation to different levels of educational attainment, employees with the lowest level of education, i.e. with only the primary education, are significantly more likely to have such contracts. Although this applies to all age categories, low-educated elderly and the youngest workers are most likely to work on fixed-term contracts.

Figure 3: Proportion of employees with fixed-term contracts by age and educational attainment (in %)


Note: SLE = school-leaving exam

Source: Czech Statistical Office: Labour Force Survey 2011

As for part-time employment, it is most common for young workers with the lowest level of educational attainment (12.1% of employees in this group) and the most highly-educated young workers (8.3% of such workers). Whilst in the first case the high share of part-time workers is due mainly to a high proportion (23.2%) of young women with the lowest educational attainment working part-time, in the case of highly-educated employees the relatively high proportion of part-time workers results, among other things, from the relatively high number of men working part-time (7.6%).

Data from the LFS further suggests that young entrants with the highest (i.e. tertiary) level of educational attainment are forced to accept, in the majority of cases (51%), a job with lower requirements in terms of qualifications than corresponds to their educational attainment since the number of highly-qualified positions is limited. On the other hand, highly-qualified young entrants find their first jobs relatively quickly compared to workers with lower levels of educational attainment. In the period 2005-2009 highly-educated young entrants needed on average 3.1 months to find their first job, while their counterparts with only an elementary level of education needed 10.6 months. Young entrants with some level of secondary education required 4.6 months to find employment (Nývlt and Bartoňová 2011).

2.2 Occupational characteristics

The practice of employing new and inexperienced workers on the basis of a fixed-term contract which is subsequently replaced by a permanent contract is more frequent in the public sector, especially in those professions that require additional qualifications or certification. Hence, the shares of young employees with fixed-term contracts are higher in different parts of public sector (e.g. 23.5% of employees in the education sector and 16.5% of employees in the health and social care sector in the age category 15-29 work only on fixed-term contracts).

Small companies with less than 50 employees appear to provide the most unsafe working environment for young workers in terms of the incidence of occupational injury with two new cases of incapacity for work due to occupational injury per 100 juveniles. Companies of this size are also the only ones in which the average percentage of incapacity for work due to occupational injury is not lower in the case of juveniles than in the total working population (both 0.13%).

Figure 4: Number of newly-notified cases of incapacity for work due to occupational injury per 100 injured persons


Source: Czech Statistical Office: Incapacity for work due to disease or injury 2012

Block 3: Evolution of working conditions of young entrants to the labour market in the last five years. Effects of the economic crisis

NCs are kindly requested to provide information on the following items: NCs are kindly requested to provide information (coming from national surveys, administrative registers or ad-hoc national researches/studies) on differences of working conditions amongst the group of young entrants to the labour market in comparison to the situation five years ago. Please provide the information only for those variables where significant/important differences, either positive or negative, can be identified, stressing the causes and rationale of these differences

Suggested extension of this section: around 500 words

3.1 Please provide information on the evolution of working conditions of young labour entrants in the last five years. Have working conditions of this group improved/deteriorated in comparison to the existing situation five years ago (before the economic crisis began)? What are the reasons for these changes

The working conditions of young labour entrants have deteriorated over the past few years, in particular in terms of employment security, which can be illustrated by reference to the evolution of the unemployment rate of young people and to the extent of the use of fixed-term contracts for young employees.

The unemployment rate of young people is generally higher than the average unemployment rate and still increased over the four years from 2007 to 2011 from 7.4% to 11.8% respectively, peaking in 2010 at 13%.

Figure 5: Unemployment rate of young people in comparison to the average unemployment rate (in %)


Source : Czech Statistical Office: Labour Force Survey 2007-2011

The risk of unemployment for young people increased by 41% between 2007 and 2011: while the ratio of the unemployment rate of young people (persons aged below 25 years) and adults stood at 2.2 in 2007, four years later it had increased to 3.1, indicating that youth unemployment grew faster than the average unemployment rate (European Commission 2012).

This evolution has taken place despite the fact that up to the global financial crisis young entrants in the Czech Republic were not considered to be particularly threatened by high unemployment and job losses rates, unlike workers in the oldest age category. However, following the onset of the economic downturn, employers chose to release firstly those employees who had not been provided with long-term training, i.e. those who had worked in the company for a relatively short period of time. Moreover, the number of available positions in the labour market was very limited during the crisis meaning that new labour entrants were faced with a low level of demand for labour force. Thus, the economic slowdown affected young workers and labour market entrants to a higher degree than other worker age categories.

In comparison with the situation in 2007, an increase was also recorded for the same reason in the proportion of young employees working on the basis of fixed-term contracts. Even though a similar tendency was identified in the 30-44 worker age group, the increase was considerably less significant than that which impacted the youngest age category.

Table 3: Proportion of fixed-term contracts in different age groups (in %)

Age categories

2007

2008

2009

2010

2011

15 – 29

10.5

9.6

11.0

13.2

13.4

30 – 44

4.4

4.0

4.2

4.7

5.2

45 – 59

4.5

4.0

3.9

4.1

4.0

60 +

35.3

34.8

34.0

27.0

19.4

Source: Czech Statistical Office: Labour Force Survey 2007-2011

3.2 Based on possible existing prospective studies, please provide information on the expected evolution of employment levels and working conditions of young labour market entrants in your country in the near future (coming 2-3 years)

No prospective studies on the expected evolution of working conditions of young labour market entrants in the Czech Republic are available. However, it seems reasonable to predict that the unemployment rates of young people will decrease with economic recovery. Fixed-term contracts and other flexible arrangements are, on the other hand, likely to be employed increasingly often as a consequence of measures introduced aimed at increasing the degree of labour market flexibility (see CZ1212029Q) which will affect young entrants and elderly workers to a greater extent than other age categories.

Block 4: Initiatives taken by national governments/social partners in order to improve employment levels and working conditions of young entrants to the labour market

4.1 Identify main recent national measures/initiatives (1-2) put in place in your country by public authorities in order to improve employment opportunities and working conditions for young entrants to the labour market.

With regard to the increasing unemployment rate of young entrants, the Ministry of Labour and Social Affairs (MoLSA) is currently promoting programmes supporting the employment of young people, a subject which is also included in the new Plan for Employment (Plán pro zaměstnanost). The Plan offers, among other things, subsidies for employers who employ young labour market entrants registered with the Labour Officeand counselling and retraining sessions for 3,200 inexperienced potential workers up to the age of 30. The retraining project, known as ‘Professional Training for the young up to the age of 30’ (Odborné praxe pro mladé do 30 let), is being financed from the European Social Fund (ESF) under the ‘Human Resources and Employment’ Operational Programme (HREOP).

While promoting inter alia active policy in the labour market as well as professional education, the HREOP also supports other programmes aimed at improving the situation of young people in the labour market, one of the most important of which is a project known as ‘Training for Young Potential Workers’ (Stáže pro mladé zájemce o zaměstnání) that has been in operation since September 2012 under the Fund for Further Education (Fond dalšího vzdělávání, FDV), subsidised by the MoLSA. This initiative enables secondary school and university students in the final years of their studies to acquire work experience before completing their studies through training courses conducted by a range of companies. The project is aimed at tackling the problem of the unemployment of young entrants to the labour market, one of the reason for which is generally considered their lack of experience. A further objective of the programme is to facilitate contacts between employers and potential employees. Training lasts from one to three months and includes soft-skills courses and counselling by the FDV. In addition, the provider covers the salary of trainees as well as a portion of the remuneration of the mentor who is in overall charge of the students involved. It is planned that the programme will operate up to August 2015 and provide support for a total of 840 students from all regions of the Czech Republic.

In June 2012, the MoLSA issued Statutory Decree No. 246/2012 Coll., which repealed the lower minimum wage tariffs that had been stipulated for those employees who were able to participate in the labour market only to a limited extent, i.e. young workers and people with disabilities. The new arrangement came into effect on 1 January 2013. The repealed regulation allowed the minimum wage of workers aged 18-21 to be 10% lower than the standard minimum wage in the first six months of their first employment and that of workers below 18 years to be 20% lower than the standard minimum wage (see CZ0512101T). The objective of the amendment is to apply equality principles in terms of employee remuneration and to prevent discrimination against disadvantaged groups of workers (Duspivová 2012).

Since all the afore-mentioned initiatives have been introduced relatively recently, it is too early to be able to evaluate the outcomes. Nevertheless, it can be assumed that the majority of measures introduced in this area by the Czech government focus on the employment of the young and do not deal extensively with the working conditions of young workers as such, with the exception of the afore-mentioned adjustment of minimum wage tariffs.

4.2 Identify main recent initiatives (1-2) put in place in your country by social partners (either at national, sector or company level) in order to improve working conditions amongst young entrants to the labour market.

Although social partners are concerned about the situation of young workers, in particular with respect to the unemployment rate of this category of workers (for more details see CZ1101019Q), the specific working conditions of young employees are not currently under debate. Since the onset of the economic crisis, social partners have adopted a strategy of close cooperation in order to maintain existing employment positions, sometimes accepting wage cuts (see CZ1212029Q) and a deterioration in other working conditions. One of the measures adopted in terms of maintaining job positions consists of an increase in the flexibility of employment relationships, often with concern particularly to young workers. However, to date, no initiatives have been introduced by social partners focusing specifically on this category of employees.

Commentary by the NC

Young labour entrants were among those most affected by the economic crisis in the Czech labour market which was reflected, for example, in an increase both in youth unemployment and the use of fixed-term contracts for this age category. In response, the employment of young people has become a social policy priority, and measures adopted to tackle this issue address in particular the unemployment of young entrants to the labour market. Useful though they may be, they do not however address the quality of employment positions offered to young workers.

References

Štěpánka Pfeiferová, Research Institute for Labour and Social Affairs (RILSA)

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