Flexibility is a term frequently used in the context of EU employment and industrial relations but its meaning is contested. This is because it includes three dimensions.
- It can refer to employers’ desire for variable (flexible) labour inputs, in terms of numbers employed or hours worked, to match changes in demand for products or services. It can also refer to changing the tasks and skills of employees to increase productivity. The first type is sometimes described as ‘external’, ‘quantitative’ or ‘numerical’ flexibility; the second as ‘internal’, ’qualitative’; or ‘functional’ flexibility.
- It can also refer to employees’ desire for variable (flexible) contractual arrangements and working conditions to match changing private and domestic needs. Flexibility may concern different forms of contractual arrangement (including ‘atypical work’), particularly as regards working time, to in the interests of achieving a better work-life balance.
- Flexibility is also often presented in the EU context as a policy response to ‘labour market rigidities’, which some economists regard as contributing to unemployment. Strategies on employment have been influenced by studies, such as that of the OECD Jobs Study in 1994, which favourably compare the US labour market with the ‘rigidities’ characteristic of the labour market in some EU Member States. However, policies of deregulation aimed at increasing flexibility (e.g. easier hiring and firing of labour) may be seen as a threat to employment security and quality of work. Accordingly, flexibility is now usually referred to in EU documents alongside security. For example, in the 2016 Annual Growth Survey, one of the priorities highlighted by the European Commission is the need for labour market policies to balance flexibility and security considerations. It underlines the challenges:
Achieving both flexibility and security in the world of work requires comprehensive reform efforts that tackle at the same time labour market segmentation, adequate wage developments, well-designed income support systems, policies to ease transitions to new jobs, equip jobseekers with the right skills and better match them with vacancies (p. 11).