Social partners tackle unemployment and skills deficit

In early October 2007, Austria’s social partners presented a joint programme aimed at improving employment opportunities for unskilled, unemployed and young people. The proposals aim to replace the current, generalised system of apprenticeships with individualised qualification programmes for young and unemployed people, and to introduce a special programme for unemployed older workers. Partial opening of the national labour market to workers from new Member States will help to offset the chronic shortfall of skilled domestic workers. The government has accepted many of the proposals.

On 2 October 2007, Austria’s main social partner organisations presented a joint employment programme which is designed to substantially reform the country’s vocational training and qualification system. This programme ensued from intense and long-lasting negotiations between the Austrian Trade Union Federation (Österreichischer Gewerkschaftsbund, ÖGB) and the Chamber of Labour (Arbeiterkammer, AK) on the employees’ side and the Austrian Federal Economic Chamber (Wirtschaftskammer Österreich, WKÖ) and the Standing Committee of the Presidents of the Chambers of Agriculture (Präsidentenkonferenz der Landwirtschaftskammern, PKLWK) on the employers’ side. The employment programme, entitled ‘Labour market – Future 2010 (in German, 171Kb PDF), contains a variety of proposals for meeting the business demand for skilled labour on the one hand and securing a high level of youth employment on the other hand.

Main proposals of social partners

The measures proposed by the social partners focus on a number of main provisions.

  • The current promotional scheme providing employers with a lump sum of €1,000 for each apprentice employed (AT0210201N) will be replaced by a more tailor-made and flexible scheme for promoting apprenticeships. This means that state subsidies payable to employers who take on apprentices will directly depend on the amount of the apprenticeship allowance paid and on the apprentice’s actual completion of the entire training year. Moreover, additional subsidies will be granted to those employers offering apprenticeships for the first time or for young people with special needs.
  • Those young people who have failed to find an apprenticeship, as well as socially underprivileged and disabled persons younger than 18 years of age will be entitled to attend special ‘qualification centres’. These centres aim to provide special vocational training programmes, culminating in a final examination entitling each participant to perform a formally recognised occupation. Furthermore, special job placement schemes originally introduced for older employees shall also apply to young employees older than 17 years of age who may have left the education system early. The same applies in relation to the special ‘crash qualification course’ on skilled labour. These schemes will also conclude with a final examination.
  • With respect to older employees, the country’s Public Employment Service (Arbeitsmarktservice, AMS) will be commissioned to implement a special qualification programme, the so-called ‘Project 10,000’. Under this programme, at least 10,000 unemployed people will be retrained for metalworking-related occupations by mid 2008. Workers for these occupations are considered to be mostly in demand by businesses. In addition to this programme, the existing subsidised wage scheme (Kombilohn) introduced in 2005 (AT0509202N) will be amended, thereby extending coverage to workers older than 45 years of age who are currently excluded from the scheme. Moreover, under the extended scheme, the threshold of wages eligible to subsidies will be increased from the current amount of €1,000 to €1,700 a month.
  • For those sectors suffering from a chronic shortfall of skilled domestic workers, the partial opening of the labour market to workers from the new EU Member States (NMS), which began in May 2007 (AT0703029I), will continue. It is planned that around 50 occupations which currently record a shortfall of skilled labour will be opened up to foreign workers by ministerial decree on 1 January 2008. According to AMS, a current need exists for at least 6,000–7,000 skilled workers throughout the country which could be satisfied by the employment of well-trained NMS citizens.

Government welcomes initiative

The social-democratic and conservative coalition government has expressed its satisfaction with the joint social partner programme. The Federal Minister of Economy and Labour Affairs, Martin Bartenstein, thanked especially the trade union organisations for having given up their strict opposition to any advance opening of the Austrian labour market to workers from the NMS. The government has also appraised the social partners’ proposals regarding the funding of the planned measures. The social partners’ proposal suggests reintroducing unemployment insurance contributions to be paid in respect of all employees up to the age of 60 years as well as appropriately using part of the surplus means of the Insolvency Payment Insurance Fund (Insolvenzentgeltsicherungsfonds). Overall, the ‘Labour market – Future 2010’ employment and qualification programme is expected to cause additional costs of €1.3 billion over the period 2008–2010. Nevertheless, the government has shown its willingness to largely fulfil the social partners’ proposals.

Georg Adam, Department of Industrial Sociology, University of Vienna

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