Zusammenfassung der Ressource
Short-term labour market effects of structural reforms: Pain before the gain? (OECD, 2016)
- SUMMARY
- KEY FINDINGS (7)
- 1. Reforms increasing level
of competition in network
industries --> Induce
non-negligible short-term
loses with employment
falling below the pre-reform
level.
- 2. EPL which reduce
dismissal costs -->
short-term unemployment
and wage loses --> But
reversed within a few years.
- 3. Labour market reforms
can be designed to attenuate
costs (not eliminate).
- 4. Effective activation
strategies --> Reduce
adverse effects of structural
reforms.
- 5. Individual bargaining (+
flexibility as firms adapt to
individual situation) -->
Limits any short-term job
losses.
- 6. "Grandfather clauses" -->
offset short-term eployment
costs of EPL reforms.
- 7. Countries with low
unemployment-benefits
entitlements + strong
fiscal positions --> Can
cushion short-term
effects in downturns.
- E.g. Temporarily extending benefit durations.
- E.g. Apply reforms only to new hires.
- CONCLUSIONS (4)
- 1. Reforms yield benefits
in the long run and
entail losses in the short
run.
- 2. Costs are higher during
downswings and
statistically insignificant
during upswings.
- 3. Policy makers -->
Implement reforms
during downturns
(greater support)
- 4. Pros and cons of
complementary policies to
minimize costs' impact.
- Depends on: Availability of resources and infrastructures.
- Goal: Investigate short-term effects of reforms that ease anti-competitive product market regulation and employment protection legislation.
- 1. PRODUCT
MARKET
REGULATION
(Goal: Lower
barriers to
improve
efficiency and
enhance
competition)
- A. DIRECT LM CONSEQUENCES
- - In network industries: Loss in employment with max. in
3 years --> Reabsorbed afterwards.
- - Network industries --> 2 offsetting forces: Immediate
re-organisation of (large) incumbents + gradual
expansion of successful entrants .
- B. INDIRECT LM CONSEQUENCES
- Long run benefits, not short run
- Spill-over effects on performance of
activities using these services --> Benefits
in terms of their value added and export
shares.
- CONCLUSIONS: Short-term
employment costs depend on
characteristics of industry.
- 2. EMPLOYMENT
PROTECTION
LEGISLATION -
EPL (Set of rules
governing the
hiring and firing
of workers)
- CONCLUSIONS
- - Extensive EPL reforms quickly modify hiring patterns by strengthening open-ended contracts (reducing dualism).
- - Reforms might also engender temporary declines in total employment.
- Solution --> Complementary reforms to limit adverse effects.
- A. EVIDENCE: INDUSTRY-LEVEL
+ CROSS-COUNTRY DATA
- - In short run, costly in wages and employment --> Disappears in a few years
- - Loses larger in downturns than in upturns.
- - The larger the share of temporary contracts in an economy, the
higher the rate of separation and, in downturns, the greater the job
destruction rate.
- - In long run, flexibility-enhancing EPL reforms affecting regulations for regular --> Reduce dualism
- B. EVIDENCE: THREE COUNTRY
STUDIES, key pillar: EPL
liberalisation for regular contracts
- Estonia (July 2009)
- - Notice periods
- Severance pay
- Reinstatement
in unfair
dismissal
- Spain (Feb. 2012)
- - Dismissal
legislation
- Collective
bargaining
- Slovenia (April 2013)
- - Notice periods
- Severance pay
- Trade unions
- Redundancies
- Temporary
contracts
- 3. DISINGING
STRUCTURAL
REFORMS THAT
LIMIT
SHORT-TERM
COSTS (Structural
reforms defined in
broadest sense)
- A. SCALING-UP
ACTIVATION
STRATEGIES IN TIMES
OF CRISIS?
- Address challenges through
providing better incentives to
various actors involved in
interventions: Employers and
employees.
- Limits: How rapidly policies can be set-up when
unemployment increases in downturn + Effective
functioning on PES (necessary professionals and
infrastructure)
- B. RFORMING
COLLECTIVE
BARGAINING:
SPAIN
- Firms: Internal flexibility
measures as an alternative to
terminations + Simplification
of firing procedures +
Reduction of associated costs
to employers.
- Results: Marked reduction of
separations (for temporary
workers) + No impacts found
on dismissal rates.
- Complementarity between EPL +
collective-bargaining reforms.
- C. GRANDFATHER
CLAUSES IN EPL
REFORMS
- Expected effects:
Temporary
increase in the
number of new
hires and
unemployment
levels + Delay
effect of EPL
- Findings suggest
that might
dampen
short-term costs,
but more
evidence is
needed.
- D. SUSTAINING INCOME
OF DISPLACED WORKER:
UNITED STATES
- Overall: Extending unemployment
benefit programes in bad times has, at
worst, no adverse welfare effects. -->
Countries with low benefit
entitlements can temporarily extend
benefit durations to cushion
short-term effects of structural
reforms.