2001 NAP issued

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May 2001 saw the publication of Italy's 2001 National Action Plan (NAP) for employment, at a time when employment is increasing and the unemployment rate has fallen below 10% for the first time in a decade. The new NAP focuses mainly on outlining the employment policies which have been implemented in recent times, rather than detailed new measures, which will be the responsibility of the new centre-right government that came to power following the general election on 13 May.

In May 2001, the outgoing centre-left government issued Italy's 2001 National Action Plan () for employment, in response to the EU Employment Guidelines for the year (EU0010276F).

Employment trends

The NAP begins by giving a quantitative analysis of current employment trends. Between January 2000 and January 2001, employment in Italy increased by 3.2% (or 656,000 jobs). For the first time 10 years, the unemployment rate has fallen below 10%, standing at 9.9%. This confirms the upturn in employment that began in the second half of the 1990s. The employment rate among the working-age population (15-64 years of age) is 53.5%, which is up nearly three percentage points on the 1995 figure (50.6%).

There has been a particularly high rate of growth in female employment, which over the five-year period 1995-2000 rose by 5.1%, compared with 1.7% for men. The employment rate for older workers (aged 55 to 64) has remained substantially stable - between 1995 and 1999 it fell from 28.5% to 27.6%, and then rose slightly in 2000 (up 0.1 point).

In regional terms, between January 2000 and January 20001, employment growth was greater in the South - up 3.7%, compared with 3.0% in the Centre and North. However, regional disparities in the Italian labour market still persist. It is significant that while unemployment is still high in the South, in the more dynamic areas of the country (especially the North-East) numerous firms find it difficult to meet their demand for skilled labour, especially among blue-collar workers.

A substantial contribution to employment growth has been made by "atypical" work - notably freelance work "coordinated" by an employer (IT0011273F), fixed-term contracts and temporary agency work. In 2000, employment in such atypical employment relationships amounted to more than 3 million (around 14.6% of the labour force). Although 2000 saw an increase in recruitment on open-ended contracts, around 60% of new jobs still involved fixed-term contracts. The growth of female employment, in particular, is connected with atypical and notably part-time work. As regards the latter, part-time employment among women has increased, and in 2000 accounted for 16.5% of female employment (compared with 3.7% among men).

Despite the positive employment trends, the Italian NAP states that Italy cannot realistically achieve the targets for increases in employment rates set by the European Council summits at Lisbon (March 2000 - EU0004241F) and Stockholm (March 2001 - EU0104208F). These targets, to be attained by 2010, are employment rates of 70% for men, 60% for women and 50% for workers aged between 55 and 64 However, achievement of values close to these targets is foreseen for the regions of the Centre and North if employment trends over the coming years are similar to those recorded between 1995 and 2000.

Employment policies

The current employment growth is partly due to macroeconomic trends, and in particular to the growth in GDP, which in 2000 was 2.9%. However, the NAP also emphasises the positive contribution made by the structural reforms undertaken in recent years. As regards the labour market in particular, these reforms have concerned: part-time and other "atypical" work; apprenticeships; tax incentives; tax relief on labour costs; and the "regularisation" of "illegal clandestine" labour. More generally, reform of the public administration and of the training system has had a significant impact.

Specifically, the reform of the job placement system (IT9710312F) is proceeding according to schedule, states the NAP. From an institutional point of view, 17 regions out of 20 have approved a regional law on the new decentralised system. Monitoring of the placement system by the Ministry of Labour (which has produced two reports, in June 2000 and February 2001) has shown that a total of 481 job centres have been created, covering around two-thirds of the country (there have been delays in some areas of southern Italy). However, difficulties have arisen in operating employment services because of the reorganisation of the facilities and problems with the implementation of a suitable information system. In generally, the employment services most widely made available under the new system are preselection of candidates for jobs and matching labour demand and supply, while job counselling services are the least widespread. However, the situation is rather heterogeneous and differs according to the area of the country considered.

Bearing these differences in mind, the NAP recognises the importance of employment policies being defined at the regional level. Development of the South is considered to be of paramount importance, and the aim is thus to increase public investment in this area. Beyond providing financial incentives for firms to invest in the South, priority is given to improving the context by intervening in infrastructure, for example.

As regards training, the reforms of recent years have three main objectives: to raise the level of vocational qualifications among young people by introducing so-called compulsory training up to the age of 18 (IT9812334F); to improve training schemes (for example, apprenticeships and job placements) which involve a combination of education and work; and to develop continuing training programmes for workers in employment, and for adults more generally. The effective introduction of the compulsory training scheme is scheduled for 2002. A further important development is an agreement signed in March 2000 by the central state (which has jurisdiction over schools) and the regions (which have jurisdiction over vocational training), which lays down guidelines for the definition of training courses for young people who do not intend to continue their studies after compulsory schooling. The agreement also concerns collaboration with other agencies, such as the employment services, which should provide information and guidance while also performing a monitoring function. In 1999-2000, financing was provided for 616 technical vocational training courses at the upper-secondary level, intended to produce technicians. This is a new track introduced in the Italian training system since 1999 for upper-secondary school leavers.

In the training field, close attention has been paid to measures designed to improve computer skills, which are regarded as indispensable for adjusting employees' capabilities to changes in the productive system and for combating new forms of social exclusion. During 2000, a three-year programme to develop teaching technologies concluded, and all schools now have access to the internet and have multimedia equipment. Moreover, in order to encourage computer use, the "PC for students" programme has been launched, making loans available to upper-secondary school students for the purchase of computers. A three-year plan for the development of basic skills in computer use and in English targeted at young people in the South has begun. Distance training schemes have also been introduced, and will be further boosted in the future, in order to develop the advanced computer skills envisaged by the "Skillpass" programme.

The development of entrepreneurship is also regarded as important for employment creation. As is well known, a distinctive feature of Italy is its large number of small firms. Since 1995, the "birth rate" of small firms has been substantial even in the regions of the South. However, the density of firms in South is still below the national average: in 2000, this density was 67 firms (excluding farm businesses) per 1,000 inhabitants, compared with the national average of 80.

Measures in the NAP to support entrepreneurship are essentially of two types – simplification of administrative procedures, and the provision of incentives and loans for business start-ups – and they are targeted mainly at certain categories of people (women and young people) and areas of higher unemployment. Monitoring shows that these measures have had a certain impact: the chances of survival of firms which receive financing is relatively high, and they make an important contribution to employment creation.

The ageing labour force and equal opportunities

The NAP also deals with the ageing of the Italian labour force and with equal opportunities.

In the course of 2000, the government approved a number of measures designed to encourage older workers to remain in the labour market, the main purpose being to reduce the risk to certain categories of workers (those with less work continuity and lower wages) of receiving inadequate pensions. Thus, the budget law for 2001 abolished a ban on combining receipt of a pension with income from employment or self-employment. Moreover, workers who have earned entitlement to a seniority pension may opt out of paying contributions if they sign a fixed-term employment contract of at least two years' duration. As a consequence, such workers may postpone their exit from the labour market and receive a higher wage, while the employer benefits from lower labour costs.

The promotion of female employment and the combating of gender-based discrimination are singled out as priority objectives for the new employment services system (see above). These should give all women seeking to re-enter the labour market an opportunity to take part in schemes to promote work entry, or training and/or retraining programmes within six months of becoming unemployed.

As regards the reconciliation of work and family responsibilities, the government took action in two directions during 2000: it enacted the law on parental leave (IT9910347F); and it introduced a range of family support measures in the 2001 budget law (tax relief, paid leave of up to two years for parents of disabled children and increased maternity grants for mothers not receiving a maternity allowance).

Commentary

The 2001 NAP was issued by the government at the beginning of May, a few weeks before the general election held on 13 May 2001 (IT0106188N). The Plan was undoubtedly influenced by the fact that it was drafted during a phase of political transition. It is therefore principally important as a document which evaluates the labour market policies implemented in recent years, and during 2000 in particular. Numerous changes have been made in this area: reform of the job placement system; reform of the training system; the spread of atypical forms of work and employment; the shift to active labour market policies; and the introduction of measures to help working mothers. Although some of these reforms have not yet been entirely accomplished, they contributed significantly to the employment creation achieved during 2000. They comply with EU employment policy guidelines as regards employability, the development of entrepreneurship and training.

Understandably, the part of the NAP which deals which the measures envisaged for 2001 is rather generic. In any case, this is a task that will be the responsibility of the new centre-right government which has come to power following the May election. According to the programme of Forza Italia, the largest party in the government coalition, the measures deemed to be of greatest priority for employment creation are reducing the cost of labour by cutting employers' and employees' social security contributions, and deregulation of the labour market. (Marco Trentini, Ires Lombardia)