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Flexibility@work 2013/2014 IOE GIRN meeting

Flexibility@work 2013/2014 IOE GIRN meeting. Annemarie Muntz. April 9 th, 2014. Paris. fast facts randstad. our environment: trends and developments. volatility. demographic changes. globalization. sectoral shifts. global migration. skills mismatch. persistent unemployment.

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Flexibility@work 2013/2014 IOE GIRN meeting

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  1. Flexibility@work 2013/2014IOE GIRN meeting Annemarie Muntz April 9th, 2014 Paris

  2. fast facts randstad April 2014, Flexibility@work, GIRN

  3. our environment: trends and developments volatility demographic changes globalization sectoral shifts global migration skills mismatch persistent unemployment technological changes job quality new attitudes to work April 2014, Flexibility@work, GIRN

  4. research at the basis of our thought leadership 2007 2010 2012 2013 april 2014 April 2014, Flexibility@work, GIRN

  5. flexibility@work 2013 development flexible employment 2001-2012 April 2014, Flexibility@work, GIRN

  6. labor market efficiency is key to competitivenessappropriate regulation on flexible labor helps to improve labor market efficiency Labor Market Effectiveness Index score 1,5 Based on BusinessEurope reform barometer DK CH AT NO NL SE KO 1,0 market type market driven social dialogue legislation driven emerging market R = 0,52 0,5 US FI GE UK AU JP 0,0 -0,5 IR FR IT ES PL BE LU GR PT Based on WEF Global competetiviness report CL SI SK CZ HU Global Competitiveness Index score -1,0 4,0 4,5 5,0 5,5 6,0 Source: CIETT / BCG, adapting to change 2012 April 2014, Flexibility@work, GIRN

  7. flexible labor relations flexibility@work 2013 research showed: NO structural worldwide growth of share of flexible labor relations in total employment since 2000 Source: Randstad/SEO, flexibility@work 2013 April 2014, Flexibility@work, GIRN

  8. size flexible labor remains modestin all regions flexible labor constitutes less than a third of all employment Source: Randstad/SEO, flexibility@work2013 April 2014, Flexibility@work, GIRN

  9. structural growth agency work penetration generally increases each economic cycle United Kingdom 3,8% Netherlands 2,7% Germany 2,0% United States 2,0% France 2,0% Belgium 1,9% Japan 1,4% Poland 1,0% Italy 0,9% Spain 0,5% Source: Ciett, economic report April 2014, Flexibility@work, GIRN

  10. agency work provides growth and transitions • agency work provides growth • German study shows companies using agency work accelerate faster out of downturn • revenue growth for agency work user organizations is 11% versus 6% without agency work Source: Ciett / BCG: Adapting to Change 2012 • agency work provides transitions • from education to work: in France 84% of under 25 entering the labor market through TAW have never worked before • from unemployment to work: in Italy 40% of unemployed or unexperienced find work through TAW • from temporary to permanent employment: 48% of agency workers in the UK and 33% in the Netherlands find permanent work within a year • transitions for target groups: in Belgium 12% of workers with a disadvantage work through agency work Source: Eurociett / UNI Europa Project: “Temporary Agency Work and Transitions in the Labour Market” April 2014, Flexibility@work, GIRN

  11. flexibility@work 2013key findings • NOstructuralworld-widegrowth of flexiblelabor relations • growth or decline of different types of flexible labor attributed to changes in local society, economic structures, institutions and legislation • flexible labor in general, and agency work in particular, facilitates transitions to employment and bring new non-traditional labor market participants to the labor market • strong correlation between the share of flexible labor and economic growth, particularly with respect to fixed-term contracts and agency work  • structuralgrowth of agencywork: penetrationratesmoving up over last decade April 2014, Flexibility@work, GIRN

  12. flexibility@work 2014 - tackling undeclared work job quality - a shared priority april 2014 April 2014, Flexibility@work, GIRN

  13. 3,9 3,8 2,5 2,7 3,3 3,8 3,7 1,2 1,7 defining job quality • job quality rating based on: • job security • job conversion • working time limits • discrimination protection • pensions • welfare • training • decent pay • representation • 0 = lowest, 5 = highest no LMU rating un- employed informal labor (bogus) self-employed zero-hours contracts casual work seasonal work agency work & payroll fixed-term contracts parttime open-ended fulltime open-ended Source: London Metropolitan University, ‘Study on Precariousworkandsocialrights’ (2012) April 2014, Flexibility@work, GIRN

  14. Flexibility@work2014: academic research on tackling undeclared labor researchers • method • testing the traditional theories on causes of undeclared work on statistical evidence • two traditional theories • ´the undeclared economy is a direct result of high taxes, state corruption and burdersome regulations and controls´ • ´the undeclared economy is a by-product of inefficient regulation of employment and lack of labour market intervention and social protection´ geography due to availibility of relevant statistical data the research includes EU-28 countries and advanced OECD economies although not included in this research, the statistical results also count for many emerging markets and countries like India & China April 2014, Flexibility@work, GIRN

  15. what is undeclared work? • ‘anypaidactivitiesthat are lawful as regardstotheirnature but notdeclaredto the public -tax, social security or laborlaw- authorities’ • broaddefinition of types • undeclaredworkwithin a formal or informalenterprise, or whatmightbetermedundeclaredwagedemployment. Eitherwholly or partially. • own-account workforanenterprise or anotherclientsuch as a household, conducted in a similar way toself-employment. • more sociallyembeddedown-account work, deliveringgoodsand services directlytoconsumerswho are neighbours, kin, friends or acquaintances. April 2014, Flexibility@work, GIRN

  16. the size of undeclared workin % of GDP europe market type market driven social dialogue legislation driven emerging market rate of undeclared work 13,0 14,2 13,9 27,6 25,5 13,0 28,0 12,2 9,9 23,8 9,1 13,0 16,4 15,5 8,0 23,1 7,5 6,1 22,1 9,7 28,4 18,6 28,4 31,2 21,1 15,0 19,0 data 2013, derived from Schneider 23,6 source: randstad flexibility@work 2014 April 2014, Flexibility@work, GIRN 24,2 25,2 japan north america oceania 9,4 10,8 8,1 6,6 8,0

  17. tackling undeclared work creates more competitive economies global competitiveness index CH GE market type* market driven socialdialogue legislationdriven emerging market FI NL US SE JP UK NO CN DK AT NZ BE AU FR LU IE size of countries EE ES MT PL CZ IT LT PT LV BG GR HU CY SI HR SK undeclared work RO source: randstad flexibility@work 2014 April 2014, Flexibility@work, GIRN

  18. tackling undeclared work increases business opportunities tackling undeclared work more jobs on the market more talent on the market more money on the market potential growth of business opportunities from an average of 15%-20% in advanced markets to over 60% in emerging markets April 2014, Flexibility@work, GIRN

  19. undeclared work affects business • unfair competitive advantage for illegitimate businesses over legitimate enterprises • ‘race to the bottom’ away from regulatory compliance • loss of market potential forced to turn to the undeclared economy to compete April 2014, Flexibility@work, GIRN

  20. undeclared work affects workers • lack of access to health and safety standards • no access to legal and employment rights such as social security and pensions • low job security • loss of employability • constant fear of detection and risk of prosecution April 2014, Flexibility@work, GIRN

  21. undeclared work affects society • loss of revenue: non-payment of income tax, national insurance and VAT • loss of regulatory control over quality of jobs and services provided • damaging on social cohesion • creating a more casual attitude towards law in general April 2014, Flexibility@work, GIRN

  22. causes of undeclared workresults of the research into the two traditional theories • undeclared work thrives in inefficient labor markets as a result of: • no form of labor market policies to protect vulnerable groups • lower level of social protection • inefficient (too strict) regulation of temporary employment and agency work employment • difficulty for firms to resort to temporary employment and temporary work agencies to meet their labour demands April 2014, Flexibility@work, GIRN

  23. less restrictive regulation on agency work helps to reduce the size of undeclared work 2,5 strictness of regulation on TWA employment (0=least restrictions, 6=most restrictions) FI GE UK NL US 2 SE JP CN DK AT NZ BE AU FR LU 1,5 IE ES EE market type market driven social dialogue legislation driven emerging market PL 1 CZ IT PT LV HU SI size of countries SK 0,5 GR undeclared economy as % of GDP source: randstad flexibility@work 2014 0 0% 5% 10% 15% 20% 25% 30% April 2014, Flexibility@work, GIRN

  24. recommendations to tackle undeclared work • providing an efficient labor market infrastructure with: • appropriate social protection and labour market policy interventions for vulnerable groups • efficient regulation on employment and accessible formal flexible labor relations to help workers enter the formal labormarket • alternatives for workers and businesses by making it easier for businesses to turn to temporary employment and agency work to meet their flexible labor demands  April 2014, Flexibility@work, GIRN

  25. Thank you

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