BULLETIN OF COMPARATIVE LABOUR RELATIONS - 73
Labour Productivity, Investment in Human Capital and Youth Employment: Comparative Developments and Global Responses
Editor in Chief:
Roger Blanpain
Editors:
William Bromwich
Olga Rymkevich
Silvia Spattini
Notes on Contributors
Giuditta Alessandrini – Professor, Faculty of Education, University of Rome III, Italy
Christina Anagnostopoulou – Head of Executive Development, UniCredit Holding, Italy
Henryk Bednarczyk – Researcher, Institute for Sustainable Technologies, National Research Institute, Radom, Poland
Francesca Brait – Researcher, Italian National Statistics Institute (Istat), Rome, Italy
William Bromwich – Research fellow, Marco Biagi Faculty of Economics, University of Modena and Reggio Emilia, Italy
Rosemary Chew – Associate Professor, Division of Economics, Nanyang Technological University, Singapore
Chew Soon Beng – Professor, Division of Economics, Nanyang Technological University, Singapore
Bengt Furåker – Professor, Department of Sociology, University of Gothenburg, Sweden
María Luisa Martín Hernández – Professor of Labour Law and Social Security, University of Salamanca, Spain
Hilary K. Josephs – Professor of Law & Dean’s Distinguished Research Scholar of Asian Law, Syracuse University College of Law, Syracuse, New York, USA
Karl Koch – Emeritus Professor, Faculty of Business, Computing and Information Management, London South Bank University, United Kingdom
Attila Kun – Senior Assistant Professor, Károli Gáspár University, Faculty of Law, Department of Labour Law and Social Security, Budapest, Hungary
Li-Li Fang – Professor, School of Education Science, Foshan University, People’s Republic of China
Tal Lotan – Director, Training and Technology Department, Manufacturers’ Association of Israel
Merle Mude – Associate Professor of Labour and Social Security Law, University of Tartu, Estonia
John Opute – Senior Lecturer, Faculty of Business, Computing and Information Management,
London South Bank University, United Kingdom
Roberto Petrillo – Researcher, Italian National Statistics Institute (Istat), Rome, Italy
Massimo Pilati – Associate Professor, Marco Biagi Faculty of Economics, University of Modena and Reggio Emilia, Italy
Jolanta Religa – Researcher, Institute for Sustainable Technologies, National Research Institute, Radom, Poland
Ekaterina Ribarova – Research fellow, Institute for Social and Trade Union Research, Confederation of Independent Trade Unions, Sofia, Bulgaria
Olga Rymkevich – Researcher, Marco Biagi Foundation, University of Modena and Reggio Emilia, Italy
Silvia Spattini – Researcher, Marco Biagi Foundation, University of Modena and Reggio Emilia, Italy
Massimo Strozza – Researcher, Italian National Statistics Institute (Istat), Rome, Italy
Alexander Zavgorodniy – Professor, Labour Law Department, School of Law, St. Petersburg State University, Russia
Zhang Xiao-ming – Professor, School of Education Science, Hua Zhong University of Science and Technology, People’s Republic of China
Editorial
This issue of the Bulletin contains a selection of papers from the international conference on Productivity, Investment in Human Capital and the Challenge of Youth Employment: Comparative Developments and Global Responses, held at the Marco Biagi Foundation in Modena, Italy, on 19-21 March 2009, and inaugurated by the President of the Republic of Italy, Giorgio Napolitano. The intervention by the President was a tribute to the outstanding courage, determination and dedication of Marco Biagi as a labour law scholar engaged in a far-reaching reform of labour law at the time of his untimely demise on 19 March 2002. During his visit to the Marco Biagi Foundation, President Napolitano underlined his own concern for youth employment, and dedicated part of his time to meeting the doctoral research students of the Foundation engaged in comparative and international research in the field.
Marco Biagi’s awareness of the problem of youth employment was one of the factors that led him to be extremely critical of the performance of the Italian labour market. His interest in this matter can be traced back to the early phase of his career, when as a young lecturer he was appointed to teach at the University of Calabria, a world apart from his own background in Bologna. His experience in Calabria gave him a profound insight into the lack of employment opportunities for young people in the Mezzogiorno of Italy, and gave him the motivation to carry out further research in the field, later coming to fruition in a series of projects with Sinnea, the training institution for co-operative enterprises. He also took part in the design and implementation of vocational training programmes for the Emilia Romagna region, and the development of an internship programme for undergraduates, initially at the Faculty of Economics in Modena, and later in all the Faculties of his University. The inspiration for this project came from his comparative studies, in particular from one of his many trips to study the intricacies of the Japanese labour market, where his hosts gave him the opportunity to see a university placement office at work, with a view to providing a smooth school-to-work transition.
One striking feature about this collection of papers, in addition to the impressive range and depth of the research by specialists from the four corners of the earth in a number of fields, including labour law, human resources management, labour economics, sociology, education and statistics, is that the themes discussed by the authors are in many ways complementary to Marco Biagi’s research over the years. These themes include the critical analysis of high rates of youth unemployment, the importance of vocational education and training, with a focus not just on the quantity but also on the quality of employment, the need to improve higher education, the need for career guidance at an early stage and for stronger links with local, national and international enterprises, the need for consultation and co-operation between employers’ associations and trade unions with a view to providing effective (re)training within a given territorial area, including tailor-made measures for migrant workers, the need for a comparative and interdisciplinary approach, and the need for empirical research to examine conditions ‘at the sharp end’, as it were, in contrast with a conception of labour law as a discipline that can be studied without ever setting foot in a production facility.
Marco Biagi was also directly involved with the formulation of labour market policy at the EU level, particularly in his role as a member of the High-Level Group on Industrial Relations and Managing Change in the European Union, and since the focus of EU employment policy in recent years has been on the promotion of flexibility for employers and security in the labour market for workers, it seems fitting that the first paper in this collection is by Bengt Furåker, a professor of sociology from Sweden, one of the countries most often cited in connection with flexicurity. He notes that young people typically change jobs several times before finding a long-term solution. Whereas some settle down quickly, others continue to circulate between jobs. The general pattern is a process of trial and error, the complexity of which has increased significantly in recent years. Furåker also discusses the difference between job security, meaning continuity in the same job on an open-ended basis, and employment security, in the sense of having a reasonable chance of finding another job with similar pay and conditions. His survey findings are to some extent paradoxical: young employees usually have jobs that are less secure than older ones, partly due to employment protection legislation, but they tend to be more optimistic about their chances of a getting an equally good job elsewhere. In his cogent analysis Furåker seeks to explain this paradox.
In the next paper, with reference to one of the transition economies of Central and Eastern Europe, Ekaterina Ribarova gives an account of changes in employment and higher education policy in Bulgaria over the past two decades, since the fall of the Berlin Wall. In the early years of the transition, many Bulgarians, particularly in the younger age groups, saw emigration to the West as the solution to their problems, but the available statistical data show that of 600,000 Bulgarians who emigrated between 2001 and 2005, 400,000 returned home, at times bringing savings and new skills with them, for the benefit of the economy of their home country. The paper focuses particularly on the need to upgrade the education system at all levels, in terms of technical equipment, curricula and above all human capital.
In connection with developments in another transition economy, Poland, the paper by Jolanta Religa and Henryk Bednarczyk examine the fivefold increase in university enrolments in recent decades, that has brought the share of young people in higher education up to almost 50%. The authors consider a range of measures for tackling youth unemployment, such as the partial funding of the cost of vocational qualifications, partial funding for postgraduate programmes, internships and vocational training in the workplace. However, they point to a general lack of interest on the part of companies in giving students internships for short periods and providing mentoring, seen as a cost for the employer: the contribution of the social partners is therefore an essential element if positive results are to be achieved.
In a paper on human resource management in the banking industry, Christina Anagnostopoulou and Massimo Pilati focus not so much on unemployment but rather on the career development of future managers. They take as their starting point the assumption that we are now in the Talent Economy, based on competition for the best people because they are the true creators of value. The implication is that employers need to promote worker motivation and adaptability by increasing employee involvement. This is not a strategy for those at the beginning of their career, but rather a strategy for mid-career development. The bank in this study seeks to identify those with at least five years of professional experience (but not more than 10 years, there is a limit), outstanding performance in their work, and potential for significant professional growth in the company. These employees are then put on a fast-track-to-success, though in terms of gender balance, only 22% of those selected are women. Whether this strategy is a source of motivation or more a cause of frustration and resentment on the part of members of staff who are not invited to take part is not investigated in this study.
The Israeli experience of vocational and technical education, and the contribution of employers’ organizations to the inclusion of young people in the labour market, is examined by Tal Lotan, who notes that in 2007 the Israeli labour market participation rate of 56.3% was lower than that of the USA (66%) and but higher than that of Italy (48.6%). A key finding is that the rate of participation in the labour force rises in correlation to the level of education. The author also presents survey findings to show that the ability to remain active in the labour force later in life is correlated to higher levels of education.
In her paper María Luisa Martín Hernández examines the role of vocational qualifications in providing safeguards for workers in a framework of flexibility, and considers the changes taking place in higher education, particularly in Spain. She also provides a close reading of developments over the last decade in European higher education policy, including the promotion of access to lifelong learning by means of the European Qualification Framework (EQF) that is intended to facilitate worker mobility by providing recognition for diplomas, certificates and vocational qualifications in general.
Moving the frame of reference beyond Europe, Hilary Josephs provides an authoritative overview of employment prospects for young people under China’s ‘socialist market economy’. She argues that China is well positioned to deal with the present economic crisis due to excellent economic indicators prior to the recession: high rates of economic growth, a significant reduction in poverty and extreme poverty, high workforce participation by young people and women, and low unemployment rates among adults and young people. One of many important insights in this paper is that China presents an admixture of characteristics usually associated with the developed world alongside features more typical of the developing world: for example, high levels of gradúate unemployment exist alongside the extensive use of child labour. Traditional labour law models are therefore inadequate to describe developments in China today.
In similar vein, Li-Li Fang and Zhang Xiao-ming discuss higher education, employment and the labour market in China, and present the findings of a survey of graduate employment in Guangdong. They highlight the exponential growth in the number of university graduates in the past nine years (from just over one million to over six million), and provide evidence of a mismatch between the expectations of graduates and what the labour market is actually able to deliver in terms of salaries and career prospects. The authors underline the need for professional career guidance during the undergraduate years, enabling students to acquire a greater self-awareness and reliable information about the needs of the labour market.
Rosemary Chew and Chew Soon Beng provide an overview of primary, secondary and vocational education in Singapore, which has a labour market characterized by unrelenting pressure from unskilled immigrant workers seeking employment in lower-income jobs. The young people of Singapore can only hope to escape the low-wage trap if they are sufficiently disciplined to complete their vocational training and learn a skilled trade. The earn-as-you-learn scheme allows workers to take part in training for a period from one to three years, including both on-the-job and off-the-job training. Such schemes even make provision for training abroad, in countries including Australia, Canada, China, India, USA and Vietnam, showing that they are highly stimulating programmes for young people with ambition.
With reference again to the European context, Giuditta Alessandrini focuses on survey findings relating to doctoral programmes in schools of education. The survey highlights the fact that a range of disciplines are taught in these schools, and that the main career opportunities for graduates in the field are to be found in schools and universities, with a smaller proportion of graduates opting to pursue a career in business. The author tracks the development of the European Employment Strategy and the Bologna Process in recent years, noting the necessary connections between the two strategies. At the same time she argues that the rhetoric of these policy documents needs to be supported by a sufficient level of funding, and points out that in Italy the funding allocated for research amounts to only 0.9% of GDP, the same as the Slovak Republic, a meagre amount compared to the Lisbon target of 3%.
In their paper on student and graduate mobility in Italy, Francesca Brait, Roberto Petrillo and Massimo Strozza provide a detailed statistical account of the multitude of individual choices that taken together constitute a substantial flow of human capital, particularly from the Mezzogiorno towards central and northern Italy. Some students move just once, at the beginning of their undergraduate studies, and remain in the same city or province also once they start work, whereas others move at least twice, once to go to university, and then again to find employment. The net loss of human capital for the Mezzogiorno is substantial, with the result that the authors describe the trend as a ‘domestic brain drain’.
In Central and Eastern Europe, domestic legislation regulating the labour market has had to undergo major reform since the Eastern Enlargement of the EU in 2004, and Merle Muda provides a detailed account of the legal provisions now in place for promoting youth employment in Estonia. During the boom years from 2005 to 2008, young people could join the labour market directly from school, but since 2008 the situation has changed drastically with a sharp rise in unemployment. With unemployment for the 15-24 age group twice as high as for the entire population of working age, the author sees an urgent need for more extensive apprenticeship and internship programmes to provide adequate vocational training.
In their study of youth unemployment in Nigeria, John Opute and Karl Koch note that it stands at 21 per cent, that is a substantial figure compared to the world average of 14%, but much less than the corresponding figure for the Middle East and Africa, where youth unemployment is estimated to be 25.6%. These figures give rise to a number of methodological problems, since many young people find work in the informal economy, whereas others get discouraged and stop looking for paid employment altogether. However, thanks mainly to the oil industry, in recent years Nigerian economic indicators have shown a robust rate of growth, in spite of a slight decline from 6.4% in 2006 to 5.9% in 2007. To maintain rates of growth of this kind, vocational education and training is key, and governments need to allocate sufficient funding for training for growth to be sustainable and to deal with the current skills mismatch.
The paper by Attila Kun also places the emphasis on vocational training, but this time with reference to the Hungarian labour market. The transition of the early 1990s resulted in a serious worsening of the labour market position of young people. It improved to some extent in the late 1990s, but the unemployment rate for this group is still relatively high. One crucial indicator of labour market quality is the NEET rate (Not in Education, Employment or Training) and Hungary is one of the EU countries that underperforms on this indicator. Actions taken to tackle youth unemployment include the phasing-out of passive labour market measures, in particular the abolition of unemployment benefit for school leavers. Policy-makers decided that for this age group the available funding should be allocated to training rather than spent on unemployment benefit, which was seen as an unproductive use of funds.
Finally, in a short piece about a specific segment of the Russian labour market, Alexander Zavgorodniy examines the career prospects of graduates from the leading law schools of Moscow and St Petersburg. With the process of globalization and Russia becoming a member of the World Trade Organization, the demand for labour law practitioners and commercial lawyers in this oil- and gas-rich economy has rapidly increased, with demand now outstripping supply. Once again, a mismatch between the supply and demand for labour, but in this case, that would appear to be the only example in this collection of papers, in favour of the young graduates in search of employment, that for many school leavers and graduates in most other countries continues to be something of a chimera. The research papers in this volume provide some useful indicators for labour lawyers, educationalists and policy-makers seeking to address this issue in their specific regional and national contexts.
William Bromwich
Olga Rymkevich
Silvia Spattini
Table of Contents
Part I.
THE PROBLEM OF YOUTH UNEMPLOYMENT IN EUROPE
Chapter 1
Job Insecurity and Job Change Prospects: Views among Employees in Sweden with a Focus on Youth
Bengt Furåker
Chapter 2
The Integration of Young People into the Labour Market in Bulgaria
Ekaterina Ribarova
Chapter 3
The School-to-Work Transition of Polish Students – are there any New Channels?
Jolanta Religa, Henryk Bednarczyk
Part II.
HUMAN CAPITAL: PROMOTING TALENT
Chapter 4
Managing Talent: New Challenges in the Banking Industry
Christina Anagnostopoulou, Massimo Pilati
Chapter 5
The Israeli Experience of Vocational and Technical Education, and the Contribution of Employers’ Organizations to the Inclusion of Young People in the Labour Market
Tal Lotan
Chapter 6
Vocational Qualifications as a Safeguard for Workers in a System of Flexicurity: the Role of Higher Education
María Luisa Martín Hernández
Part III.
HUMAN CAPITAL AND LABOUR PRODUCTIVITY POLICIES: THE CHALLENGE OF THE ASIAN MARKETS
Chapter 7
Youth Chances and China's Urban/Rural Divide
Hilary K. Josephs
Chapter 8
Higher Education, Employment and the Labour Market in China: A Survey of Graduate Employment in Zhujiang Delta, Guangdong
Li-Li Fang, Zhang Xiao-ming
Chapter 9
The Economics of Youth Employment: Prevention is better than CurePRIVATE
Rosemary Chew and Chew Soon Beng
Part IV.
THE REFORM OF EDUCATION AND TRAINING AS AN ANTIDOTE TO PRECARIOUS EMPLOYMENT: NATIONAL CASE STUDIES
Chapter 10
Higher Education Quality Assessment for Innovation and Transfer in the Knowledge Society
Giuditta Alessandrini
Chapter 11
Student and Graduate Mobility in Italy
Francesca Brait, Roberto Petrillo, Massimo Strozza
Chapter 12
Legal Means for Promoting Youth Employment in Estonia
Merle Mude
Chapter 13
The Role of Industrial Relations in Youth Employment: Case Study of Nigeria
John Opute, Karl Koch
Chapter 14
National Youth Employment Programmes in Hungary
Attila Kun
Chapter 15
Employment Problems of Young Lawyers in Russia
Alexander Zavgorodniy