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For some time, the public job placement offices in Italy have played an increasingly minor role in the filling vacancies and finding jobs. This induced the Government to issue a draft decree-law in September 1997 which aims to reform the legislation on placement services. In order to rationalise the public employment service, the draft decree-law envisages the decentralisation of responsibilities to the regional authorities. It will also liberalise the system, with private organisations also allowed to provide services bringing together labour supply and demand.
The context
Since the end of the Second World War, job placement services in Italy have been managed directly by the state through local offices of the Ministry of Labour, the uffici di collocamento.
Until the beginning of the 1980s, the Italian labour market was regulated by laws which gave precise specification to hiring (and firing) practices and which imposed, at least in principle, close constraints on firms' freedom of action. The criterion that governed recruitment by firms was the so-called chiamata numerica("numerical recruitment") system, whereby firms notified the placement office only of the number of workers that they intended to hire. The placement office then drew up a list of names on the basis of the length of time that unemployed workers had been enrolled on the placement lists. Exceptions were made in the case of specific professional categories - exceptions which in reality meant that the rule was frequently bypassed.
Since the early 1980s, the Italian labour market has been gradually deregulated. This reform has also affected job placement services, so that since 1987 the chiamata nominativa("recruitment by name") system has become the usual practice in hiring, while "numerical recruitment" has persisted for people with disabilities, agricultural workers, and low-skilled workers in the public administration.
The reform of job placement services
The Government's project to reform the public administration has led to enactment of law no. 127 of 15 May 1997, the so-called Bassanini Law (taking the name of the Minister of Public Services). One of the aims of this law is to increase the efficiency of the civil service by devolving competences to the regional administrations.
On the basis of the provisions set out in law 127/97, in September the Ministry of Labour and the Ministry of Public Service issued a draft decree-law intended to reform state-run placement services. The main points covered by this draft decree-law are:
- the devolution of competences to the regional level; and
- ending the public monopoly of mediating labour supply and demand.
The draft decree-law will transfer the powers exercised by the state through the local offices of the Ministry of Labour to the regional administrations. The state will continue to exercise control, settle disputes and manage the information system, whereas the regional administrations and other local authorities will assume responsibility for all job placement initiatives. For this purpose, a number of new bodies will be created, while those already in existence will be reformed. A body consisting of representatives from the regional and provincial administrations, the municipalities and the Ministry of Labour will be created in each region. This body will coordinate initiatives at the local level while their actual management will be the responsibility of a regional public agency. A joint committee will also be set up consisting of representatives from local governments and the social partners, which will draw up proposals and assess the effects of local-level employment policies.
The second major change introduced by the draft decree-law is the opportunities it provides for private organisations to offer job placement services. Thus the state's monopoly of this activity will be superseded. However, these private organisations must obtain authorisation from the Ministry of Labour, which will also fix the criteria for eligibility to undertake such activities. These organisations must be non-commercial enterprises (including cooperatives) or agencies with a capital of at least ITL 200 million. Moreover, the operators of these enterprises or organisations must possess appropriate professional experience, and the placement service must be provided free of charge. Finally, these private organisations must work in close coordination with the newly-created public bodies at regional level, to which they must send the relevant data on labour demand and supply.
Commentary
Public job placement offices in Italy perform a marginal role in filling vacancies and finding jobs. Indeed, although at the end of 1996 there were more than 6 million workers enrolled on the unemployment lists, only 5% of hirings were mediated by the public placement offices (according to il Sole 24 Ore, 2 October 1997). This was due to a number of factors. The efficiency of the public job placement offices was hampered by the high level of "bureaucratisation" resulting from: the centralisation to the state level of placement services; and the fact that employment policies were translated into rigid legislation creating constraints, rather than the provision of services like counselling and training. Moreover, the spread of "recruitment by name" provided firms with greater freedom of action. Even before 1987 partial relaxation of the rules, the rigid legislation regulating the labour market was frequently bypassed by firms, which in many cases did not respect the "numerical recruitment" criterion.
The aim behind the decentralisation of powers in matters concerning job placement is to eliminate the inefficiencies of the public service arising from bureaucratisation and lack of coordination among the various parties. To this should be added the fact that in a labour market like Italy's, with its marked geographical heterogeneity, decentralisation allows the regional administrations to design measures that are more closely targeted on the local situation.
The removal of the public monopoly is a response to an undeniable fact - the marginal role of the job placement offices. However, given the legislation currently in force, there are numerous, often "underground", agencies and/or firms operating in this area, which evade every form of control. Consequently, a further aim of the proposed decree-law is to set rules and controls for the activity of bringing together labour supply and demand. (Marco Trentini, Ires Lombardia)