Employment security

Policymakers are facing the crucial challenge of regulating a rapidly evolving labour market in the context of the globalized economy. Will they listen to calls made for greater flexibility to overcome what have often been characterized as labour market rigidities: employment protection and legislation, union bargaining power, generous welfare systems and high labour taxation? Or can they place their trust in a "flexicurity" model: new ways of balancing flexibility and security in relation to employment, income and social protection? The ILO encourages a "flexicurity" approach which requires, but also promotes, high employment rates. Without competitive enterprises which are able to adjust their workforces to market conditions, employment performance will be poor. However, high levels of labour market flexibility per se cannot solve the unemployment problem, unless workers enjoy sufficient employment and income security, through intensive re-employment assistance, active labour market programmes and income support, to motivate them to accept higher mobility and flexibility, and facilitate their adaptation. Dialogue between governments, workers and employers on policy choices is the foundation of the "flexicurity" approach.