[Intro]
00:00:32 Mary McCaughey
Welcome to Eurofound Talks. This edition of our podcast series which looks at the way Europeans live and work across the European Union today and on this occasion we’re looking at Europe Day. The 9th of May is a time to reflect on the accomplishments and the challenges of European integration. And every year Eurofound marks the 9th of May with a yearbook ‘Living and working in Europe’. We trawl through the data to analyse the trends and suggest future developments in labour markets and social policies which we think can inform the policymakers at EU and at national level. And we hope that some of this information will be used as they shape the future in terms of policies that matter most to their citizens.
The 2022 yearbook is, however, published in the shadow of the COVID pandemic. Clearly, the pandemic itself is not over and, of course, tragically, we are also now dealing with the implications and effects of the ongoing war in Ukraine.
So for this podcast, as we look at what it means to live and work in Europe today, I will speak to five colleagues to get their perspectives on developments in their particular fields of expertise. So firstly, I turn to Barbara Gerstenberger, who’s our expert on working conditions and sustainable work. Barbara, we’re now two years on from the start of the pandemic which has brought so many changes to all our working lives and, indeed, our lives in general. How have working trends developed in that time? Can you tell us over the last year specifically in terms of 2021, is working from home still as prevalent as it appeared to be at the height of the pandemic?
00:02:38 Barbara Gerstenberger
The highest level of telework we saw during the spring of 2020 when, according to Eurofound’s e-survey, 34 % of workers worked exclusively from home and then a year later in spring 2021 when we repeated the survey this was down by ten percentage points so only 24 % of workers were working from home exclusively, even though at this point in time, in many countries, there were again relatively strict lockdowns.
00:02:48 Mary McCaughey
And remind us, Barbara, how does that compare to the situation before the pandemic?
00:02:52 Barbara Gerstenberger
Only around 3 % of workers were working from home regularly in the EU in 2019. So a hybrid model, combining working from home with working from the employers’ premises, is here to stay. Now, what workers cherish is the increased flexibility that hybrid work brings, especially with regard to organising working time, which allows a better combination of work and non-work-related responsibility. At least this is the perception, that it’s easier to find a good work–life balance if the possibility for hybrid work exists.
00:03:34 Mary McCaughey
So what we’re seeing is that these changes may suit workers more in the way they live and the way they engage with their work environment. But does it suit employers? What do employers make of this flexibility?
00:03:34 Barbara Gerstenberger
We did interviews in the framework of Eurofound’s European Company Survey and those showed that the main concern is about the impact on collaboration and the impact on the workplace climate, lack of social interaction and of informal encounters. It seems to be the case that people, when they’re working remotely, communicate with their immediate team members but less and less with the wider organisation. And this is the fear can impact negatively on creativity and innovation, for example.
00:04:32 Mary McCaughey
Indeed, Barbara, very clear. John Hurley, you are our labour market expert. And to follow up on these changing trends, can you talk to us about how these changes are going to impact on the way we work? Can you tell us what’s the risk of a kind of two-tier labour market developing? And also, what kind of workplace inequalities can we expect to grow?
00:04:56 John Hurley
The majority of people do jobs that really don’t lend themselves to remote working. And you know, in a paper that we did with Joint Research Centre colleagues, we did point out that this is a potential digital divide. And this largely revolves around the extent to which jobs involve physical manipulation or physical handling tasks or jobs which involve intellectual work, knowledge-based work, and the majority of that work is capable of being worked remotely. But that tends to be high-paid work. And the work involving a lot of physical handling and physical manipulation tasks tends to be lower-paid work. So again, there is a possible development of a digital divide and kind of a new emerging form of inequality in our labour markets as a result of that the greater incidence of telework.
00:05:42 Mary McCaughey
So looking back now then over the past two years and the impact of the pandemic, what can you say, John, about the resilience of the European Union’s labour market to this most dramatic of shocks?
00:05:57 John Hurley
If there was a distinctively European response to COVID, as compared let’s say to the United States, it was very much about this emphasis on retaining the employment relationship, whereas in America the emphasis was much more on ensuring people who lost their jobs had some degree of unemployment coverage and unemployment benefits. So, there was a different emphasis but I think the labour market data from America and from the European Union illustrate that the European approach has been more successful in terms of actually retaining employment and ensuring that employment levels recovered reasonably fast from this big shock in early 2020.
00:06:37 Mary McCaughey
Looking forward, do you think that we can expect the same positive trends or are we in fact facing new challenges for the labour market in light of the most recent developments, not least, unfortunately and very sadly, the war in Ukraine?
00:06:52 John Hurley
It’s taken two years for us to recover to similar employment rates or similar employment levels this time, compared to six, seven or eight years after the global financial crisis. Does it mean that the trouble is over? Well, there are new problems; there are going to be problems probably as a result of the Ukrainian crisis but there are other different problems and, and maybe some of them are more on the supply side rather than on the demand side. There are clearly indications of employment shortfalls in some sectors, in health notably, but also in hospitality in a number of countries, and of sectors where, frankly, there are there are very significant labour shortages.
00:07:34 Mary McCaughey
Thanks, John. And clearly a lot of the issues that we are discussing, they’re not experienced in the same way across the board. We’ve seen that there have been different consequences for different groups. And specifically, I now turn to Maria Jepsen, who’s our Deputy Director. How has the pandemic impacted women, particularly in the workplace?
00:07:59 Maria Jepsen
The pandemic has had a fairly important impact on women on various dimensions, basically due to the gender imbalances that we have across the economy. So firstly, with regard to the labour market, the sectors that were hit by the pandemic, either in terms of closure or in terms of being on the front line, had a majority of women working in them. So, in retail, which was closed for a large part of the pandemic in certain countries, we have a very large part of the jobs held by women. On the other hand of the spectrum, healthcare, education, which were sectors that remained open to a large extent; in healthcare, for example, 75 % of the jobs are held by women.
00:07:59 Mary McCaughey
And what do you think, Maria, what has that meant for women more generally in their working lives?
00:07:59 Maria Jepsen
Our data shows that, in particular, women with younger children 29 % had a hard time focusing on their jobs compared to only 16 % of men with younger children and 29 % of women were too tired to engage with household work after their job compared to only, once again, 16 % of men. So there’s a large difference in terms of how the closure of the economy, how this impacted on work–life balance, how this impacted on men and women, and that comes down to the imbalances and distribution of, I would say unpaid work in the household.
00:09:36 Mary McCaughey
Eurofound has analysed these pay inequalities between men and women over the years. And at the moment, of course, the EU’s approach to this is via the pay transparency directive. What’s your own view on this? Do you think it’s enough to tackle this gap in pay?
00:10:00 Maria Jepsen
I really think that the Pay Transparency Directive is an extremely important tool in dealing with the gender pay gap because it will enable to identify where you have unexplained gender gaps in pay in companies, not only unexplained but also explained gender pay gaps. You know, even though you can explain why this gender pay gap is there, you can engage with whether that is actually a valid explanation, yes or no. So I think it’s a very important tool, but it’s only a part of a toolbox that is needed to deal with gender equality in the labour market.
00:10:42 Mary McCaughey
Thanks, Maria. Clearly, women have taken a significant hit during the last two years, but unfortunately, they are not alone. We know that the young people of the European Union have also been very badly impacted. And I want here to turn to Massimiliano Mascherini, who’s our expert on youth and we’ve talked before, Massi, about the issues facing young people, to ask you: the effects that Maria has described for women – do they hold true also for young people?
00:11:09 Massimiliano Mascherini
Young people have been hit very hard in terms of employment participation, in terms of their human capital accumulation and in terms of mental well-being. At the beginning of the pandemic, unemployment surged among young people much more than the rest of the population. It was a very hard impact because the sectors where young people were working were those that were closed as a result of the non-pharmaceutical interventions and lockdowns.
00:11:38 Mary McCaughey
Yes. And, Massi, you heard John talking earlier that generally the recovery in labour markets was much swifter after COVID than it was after the financial crisis 15 years ago or so. Do you think that that applies to young people as well?
00:11:56 Massimiliano Mascherini
With the recovery, we have to say that at this time labour markets of young people recovered very very well actually. And now unemployment of youth is at the same level of before the pandemic. Or have they suffered that disruption in human capital accumulation due to the school closures, which will have probably more long-term implications than it was thought at the beginning? Especially if we actually project this with the green transition that we have in front and the accumulation of skills that will be useful in a digital and green world.
00:12:33 Mary McCaughey
So there’s some bounce back there. But in terms of the long-term implications that we are also seeing, mental health figures as one of those key issues. What does the research show us here?
00:12:51 Massimiliano Mascherini
Lockdown, social distancing and school closures has hit young people very very hard in terms of mental well-being. Before the pandemic young people were those that had a higher level of mental well-being in comparison to the rest of the population. Unfortunately due to the crisis, this situation is now reversed, which meant young people were hit much more in terms of mental well-being than the rest of the population and this will have implications for the future that need to be addressed with tailored policy initiatives.
00:13:25 Mary McCaughey
Thanks, Massi. Clearly, that’s one of the most important issues for us all in 2022 as we discus this on the 9th of May, Europe Day, in what we are calling the European Year of Youth 2022. But also, it’s important for us to take stock of the situation for young people as we come to the close of the Conference on the Future of Europe, which has been ongoing for the last year or so. It will help to shape some of the big decisions over the coming years at EU level. And we also have with us today our Executive Director, Ivailo Kalfin. Ivailo, you attended some of these meetings and most recently a session here in Dublin. How important do you think is this initiative – the Conference on the Future of Europe – for addressing the issues at the core of our work here at Eurofound?
00:14:19 Ivailo Kalfin
The conference is very important because listening to the voice of the citizens regarding the EU policies is extremely important because usually, of course, citizens participate in elections. The conference provides a totally new opportunity for the citizens to discuss issues that are important for them. And I’m very happy to see that many of these issues are those that Eurofound is working on; living conditions, working conditions, the possibility to move freely across the European countries and to get access to public services across the EU.
00:14:57 Mary McCaughey
Certainly, we feel and see that the conference is taking place at a time of crisis. Firstly, we had the COVID pandemic, now we have the war in Ukraine. It is a moment in time and for the European Union it potentially is a crossroads. How do you think the European Union should look to the future?
00:15:25 Ivailo Kalfin
The European Union has to look a little bit further. This is not an integration community which is created in order to tackle current crises, even if they are the deepest ones. So what we expect from Europe, this is to look a little bit further to see how we are going to live in 10, 15 or 20 years ahead, to prepare the European society and the European economy for these changes also. In that sense, I think that it’s very important to keep the importance of the green transition. The digital transition is happening anyway we are adapting to it and we have to find the best way to adapt. But these are important issues.
00:16:05 Mary McCaughey
Yes. And tragically, with the war in Ukraine continuing to unfold, we have begun to see the knock-on effects, both financial and economic, in addition to the horrors of the war itself. We’ve seen a dramatic increase in inflation recently. We’ve seen cost of living rises. We’ve seen energy prices increase. But in terms of the inflation increase, it’s a factor that’s potentially diverting the EU’s attention away from other themes. Is this something that the EU should lead on, or should national governments take the primary role?
00:16:45 Ivailo Kalfin
We had already higher inflation after COVID. Here at the national level, you hardly can do anything else than compensating to the extent possible, especially the groups that are the most vulnerable. These are people that have difficulties to cope with the increasing prices. So here we have the role of the European Central Bank, we have the role of the European Union looking for the monetary policy, the European coordination, looking for alternative supplies of full-time energy and we have the national solutions and eventually some coordination trying to help the most vulnerable groups during this time. If you take one of them and forget about the other ones, then the result is going to be less convincing.
00:17:39 Mary McCaughey
Thanks Ivailo, and indeed thanks to all our guests; to Maria, Barbara, John and Massi. We’ve looked at the living and working as it is in Europe today, clearly raised many challenges which are ahead for Europe, but we hope also we’ve given you some insights and ideas from our experts on how potentially we could address them. Our role here in Eurofound is to provide the data and analysis that can help shape better lives and work for all Europeans. You can continue to find all of this and more in the Living and working in Europe yearbook, which will mark Europe Day 2022, and you can of course download the yearbook and all of our other research from the Eurofound website ongoing. Subscribe to our social media channels and listen in to the next time when we have another episode of this podcast series when Eurofound talks to you.
[Outro]
