The ‘Employment in Europe 2007’ report identifies strong economic growth within Member States, accompanied by significant challenges in raising employment rates. It addresses topics high on the European Union’s employment policy agenda, including issues of age, flexicurity, vocational training and labour income share. This article focuses mainly on age and flexicurity, areas of interest which are particularly topical in relation to working conditions.
The European Commission has outlined key messages (148Kb PDF) from its report Employment in Europe 2007. The report begins by providing a brief analysis of European labour markets (Chapter 1 (752Kb PDF)), noting that in 2006 EU economic growth was better than anticipated. This had consequences for employment growth and labour productivity, and these were particularly strong in the new Member States of Bulgaria, Estonia, Latvia, Poland and Slovakia. The report indicates that these high growth rates will be sustained through 2007.
Employment levels
At the Stockholm European Council in 2001 (EU0104208F), the EU adopted target employment rates. The 2007 report finds that, while the target for female workers is within reach, it will be more difficult to achieve the objective set for older workers. Thus, despite a generally positive analysis on employment, there are areas of concern. Youth unemployment remains a challenge for many Member States and no real breakthrough has emerged in the average youth unemployment rate, which is higher than in the rest of the industrialised world. The major cause of their exclusion from the labour force is related to poor levels of education and the lack of effective activation strategies in helping young workers enter the labour market.
Age and employment
Chapter 2 (707Kb PDF) focuses on policies designed to keep an increasingly older workforce in employment. Over half of all 55 to 64 year olds are classified as ‘economically inactive’ due to poor health, personal or family responsibilities, or the belief that no work is available. At the same time, measures to support active ageing, such as those called for by the European Employment Strategy, are starting to produce results, with a growth in employment rates of seven percentage points in less than 10 years.
However, the report finds that the general increased participation of female workers accounts for much of this rise. For male workers, the analysis notes that active ageing polices can be successful if they are delivered in an environment where older people enjoy good levels of general health, and where reasonably high average retirement ages are maintained, combined with a high level of spending on lifelong learning alongside flexible working arrangements. Flexible forms of work are particularly dominant among older workers.
Working time and flexicurity models
Chapter 3 (638Kb PDF) identifies a continuing downward trend in average working hours and a growing acceptance of more flexible working practices. This is to an extent accounted for by part-time work, which provides opportunities to reconcile work and family, but which is often associated with negative employment prospects. Various forms of flexible working are now relatively common but are more prevalent in the services sector and among larger employers; the option of varying start and finish times is the most widespread practice in this regard. In terms of flexible work organisation, meeting quality standards and autonomy in speed of work are the most common forms.
The report refers to the Commission Communication on flexicurity and notes that this balance between flexibility and employment security requires the promotion of both flexible working time arrangements and different forms of work organisation. It also uses data from the most recent European Working Conditions Survey, in particular the section on flexibility. The report suggests that the taxonomy of flexicurity regimes, advanced in Employment in Europe 2006, needs to be updated and that a consideration of both external and internal forms of flexibility – and their interaction – is essential to characterise labour markets and flexicurity regimes across the EU.
Significantly, the report highlights two models as delivering relatively good socioeconomic outcomes, namely the ‘Anglo-Saxon’ and ‘Nordic’ models. Each model performs better in some areas than in others, leading to the conclusion that no one model performs better on all counts. Nevertheless, advanced internal flexibility models – combining greater demands on workers with increased autonomy – may represent a ‘win-win solution’, whereas more basic forms of functional flexibility, like task rotation and teamwork, appear to be detrimental to job satisfaction, work-life balance and work-related health outcomes.
Training and income
Turning briefly to the remaining two chapters, Chapter 4 (300Kb PDF) finds an increasing recognition of the importance of continuing vocational training, but that the free market is failing to provide for this efficiently. In relation to labour income share, Chapter 5 (542Kb PDF) notes that this has fallen markedly and that, while the proportion of skilled workers has risen, the share of unskilled workers has declined progressively.
Commentary
Employment in Europe 2007 not only offers a wealth of detailed data on working conditions but also provides analytical comment and observation on employment. Its overall analysis of employment prospects for the EU, while mainly positive, hints at risks and dangers ahead –particularly those associated with demographic change and skill imbalances.
Sonia McKay, Working Lives Research Institute