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Second France/ILO Symposium
The future of work, employment and social protection:
The dynamics of change and the protection of workers
(Lyon, 17/18 January 2002)
Introduction to the second France/ILO symposium
Peter Auer/ Bernard Gazier
Most of the papers presented in this symposium are organized around two
common themes: policies in the area of work, employment and social protection
are not of a static but a dynamic nature and must therefore be analysed in
dynamic terms. From this stems a second common theme: the necessity to
design and implement integrated, and not fragmented, policies. In this short
introduction, we will develop these two themes, beginning with the necessity of
designing policies relating to work, employment and social protection in
dynamic terms.
We are used to static analysis, although we are aware that everything is in
movement. A brief example is the unemployment rate and numbers that we are
used to dealing with -- around three million in France and four million in
Germany, the result of both inflows and outflows into unemployment. For
example in Germany, more than seven million unemployed face at least one
unemployment spell per year and each spell might bear the risk of long-term
unemployment. In reality therefore we are dealing with seven and not four
million unemployed, and policy has to deal with the flow (seven million) and the
stock (four million). This is the same in most countries: flows (the dynamic) are
a multiple of stocks (the static).
Dynamic analysis can be applied to the concept of decent work, mentioned
by the ILO Director-General, Mr. Somavia, in his introduction. As you know this
concept is a key ILO target: "a vision built around four essential elements: a
universal objective, productive employment, a double condition: the respects of
workers' rights and of social protection, and a method of realizing it: the social
dialogue". Clearly, if we look at the state of the world, this is an idealistic vision,
but as has also been pointed out: "decent work can be a formidable accelerator
for development".
At first glance decent work is a relative, but static and individualized
concept: a job is decent depending on certain benchmarks at a given moment in
a particular (geographical or economic) area. Such benchmarks could be the
income the job generates or the rights that can be derived from it within a given
boundary (region, country, etc.). Rights refer to fundamental rights such as work
not being forced, the right to representation, a voice and collective bargaining,
and the right to social protection and non-discrimination.
However, there must also be a time dimension in the decency of jobs. This
refers to the sustainability of decent work; it does not mean that only lifetime
employment should be considered decent, but that a degree of sustainability is
required for a job to be declared decent with any justification. Consider the
following: an individual could have held a decent job in time t but have lost it in
time t+1. Now the decency of this job over time depends on the chances of
quickly finding another decent job and/or enjoying proper social protection
during the transition from one job to the other. Such an analysis would consider
decent work as an extended form of longer-term employment because it includes
job transitions and accompanying institutions. A decent job is "embedded" in an
institutional network. The example shows at least two things: decent work
should be a dynamic, rather than a static concept, and it should consider the institutions
in which jobs are embedded. A job is really decent only over the long
term, independent of job changes, and when the periods without work are protected.
Furthermore, decency must also have an element of progress in it: decent
jobs are those that present possibilities for professional and personal development.
It is the development dynamic which is important: a job might not be
decent in regard to certain standards (e.g. generating low income, low protection,
no voice) but might lead to decent jobs in the future. It might well be
considered decent if it has offered a bridge into employment. We could extend
this to the development aspects of decent work in developing countries.
From a methodological point of view an analysis of the dynamic dimension
of decent work requires one or all of the following: good time series, which
allow analysis over time, and panel data, which allow life-cycle approaches as
wellas periodically repeated qualitative information on jobs (e.g. surveys on
living and working conditions).
Even without any relative dimension in terms of regions or countries (developed,
less developed, etc.), the time dimension excludes any "one best way"
definition of decent work: requirements in terms of decency of work from the
supply side of the labour market - the working individuals - vary over the
working lifetime of an individual, e.g. one needs less security when one is young
and independent than when one is older with family dependents. Different
requirements over the life cycle in terms of decency of work also stem from the
demand side: a recently set up small firm will probably offer less secure and
well-paid jobs than an established company, but might do so at a later date. If we
integrate an enterprise dimension into the picture we might find that even established
firms are less able to offer decent jobs in the troughs of business cycles
than at the peaks. This leads us on to the second extension of the decent work
concept: the importance of embedding institutions.
There is in fact an institutional dimension to decent work. Take the example
above of an individual losing a decent job. If there are no other decent jobs available
and there are no social plans, none or only very insufficient unemployment
compensation schemes, no active labour market policies, the individual faces
prolonged unprotected unemployment and will most probably fall into poverty
if there is no other source of income. The once decent job has turned into an
undesirable situation with no job. If other jobs are available, then there is no
problem; if accompanying institutions such as unemployment benefits, social
assistance and active labour market policies, as well as some services (employment
services) are available, then the decency of the former job might be upheld
over some time. If these institutions are geared towards allowing smooth transitions
on the labour market, they are an active element of decent work because
the main decent job characteristics (income, social protection, etc.) are organized
not only by the firms but also by collective institutions. It is the interaction
between firms and labour market institutions that bring about decent work.
Decent work should therefore be seen in such a wider context, including a
dynamic and institutional view, the latter showing that there is a need for policy
integration. The symposium raises awareness on these matters.
POLICY IMPLICATIONS OF A DYNAMIC APPROACH
Things change fairly radically if a dynamic and longitudinal viewpoint is
adopted. A major issue - the implications for economic and social policy - then
presents itself. Obviously, changes will have to be considered in comparison to
the traditional approaches and requirements. But what changes are involved?
Some are obvious, but more often than not they are difficult to identify.
Consider three examples of the problems presented:
1. Many effects are indirect, because the economic and social system is more
than capable of offloading measures that interfere with existing operations
onto other people or other areas. Early retirement is a notable example here.
Early retirement schemes are expensive and feature many disadvantages,
which will be highlighted and discussed during the symposium. Many
countries that have previously applied them on a large scale have since tried
to restrict them or even abolish them altogether. But firms have continued
their policy of retiring workers early in many countries, and now these
countries have large numbers of unemployed workers in the 55-65 age
bracket. Because their chances of re-employment are not good and the
demand for early retirement remains strong, it has been decided to keep
them unemployed and "exempt from seeking employment", which is tantamount
to giving them early retirement on the cheap, with less income and
in a less socially accepted position. The solution here is to act further
upstream, by trying to influence firms' and workers' behaviour.
2. We therefore need to stress the prevention side, but it is difficult to link up
preventive and remedial policies, and to give the appropriate weight to these
two principles of intervention. At first sight this appears to be the classic
dilemma of how to distribute limited resources among mutually exclusive
objectives. But we can see that this is a very static view and that we need to
look beyond it. It is absurd to condemn ourselves to always taking action
too late. The problem is how to encourage everyone involved to make
choices that will be good for the long term. One procedural solution is to
organize funding and pay in such a way that those who succeed in making
savings in the medium term, such as by increasing the rate at which they
place their "clients" in permanent employment, have more resources put at
their disposal. They are then able to step up their preventive measures, and
the balance shifts accordingly. The question, although still a difficult one,
is now expressed in different terms: what are the best ways of making those
involved see the long-term consequences of the choices they make?
3. Policies need to be more transversal or even integrated - which seems
guaranteed to make the situation even more complicated! For example, it
appears that some of the interactions between the goods market and the
labour market need to be clarified: the social regulations that can be used as
an excuse for the Northern countries to apply protectionist policies against
the Southern countries are a telling example. It suggests that there should
be places where problems of world trade and "decent work" could be
discussed side by side, and that the affirmation of social regulations should
go hand in hand with measures to combat protectionism in the Northern
countries.
On the other hand, "social" measures can turn out to have a huge
"economic" impact on the labour market itself, particularly measures to promote
equality between men and women. For example, the right to stay at home to look
after a sick child is a "social" measure that can have the effect in the long term
of increasing the employability and income of women who do not have to interrupt
their careers. More generally, measures to promote female employment and
occupational equality between men and women are intrinsically productive in
the long term, since they provide access to an increasingly skilled reservoir of
labour and do more to guarantee funding for pensions.
Much of this symposium will consist of defining regulatory concepts rather
than detailed requirements.
The purpose is an in-depth exchange of views between economic, social
and political decision-makers and researchers, with journalists also involved. We
hope that the "cocktail" will be creative and that the discussions will go some
way towards finding long-term solutions.
Just a quick word about how we will work. We wanted to have both free
debate, on a fairly informal basis and with as little distance as possible between
the speakers presenting the reports and the participants, and also in-depth discussions,
with documents distributed in advance and available for consultation, and
debates prepared in advance. Obviously, these aims were difficult to achieve
when you consider how busy everyone is!
We decided on a two-fold compromise: to first hold a meeting to discuss
the sessions in small parallel groups (which we did yesterday) and to leave
around half the time for a general discussion.
As these talks begin we would like to thank all those who have helped in
the preparations, both by giving us the benefit of their expertise and in terms of
organisation.
In conclusion, could we just say how exciting we have found these preparations,
and that we hope that you will share in this excitement.
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Introduction by Peter Auer and Bernard Gazier