global trends and nordic labour markets - bhm

31
Global Trends and Nordic Labour Markets Scenarios for University Graduates Christian Lyhne Ibsen, FAOS at University of Copenhagen Assistant professor, PhD Reykjavík, November 2016

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Page 1: Global Trends and Nordic Labour Markets - BHM

Global Trends and Nordic Labour Markets Scenarios for University Graduates

Christian Lyhne Ibsen, FAOS at University of Copenhagen

Assistant professor, PhD

Reykjavík, November 2016

Page 2: Global Trends and Nordic Labour Markets - BHM

Program

About the Nordic Model

Four major trends

1. Transition to wage moderation and flexibility

2. Precarious work in the knowledge economy

3. Organisation of workers and employers

4. Socio-economic equality

Scenarios and Discussion

Page 3: Global Trends and Nordic Labour Markets - BHM

Nordic success… partly based on collectivist industrialrelations

OECD, 1990 (grøn) og 2010 (lilla)

-

10

20

30

40

50

60

70

80

90

100

ISL

FIN

DN

K

SWE

NO

R

BEL

LUX

ITA

IRL

OEC

D

AU

T

CA

N

GB

R

GR

C

NLD

PR

T

DEU

AU

S

CH

E

ESP

MEX

PO

L

USA

KO

R

FRA

TUR

Fagforeningernes organisationsgrad 1990, 2010

Page 4: Global Trends and Nordic Labour Markets - BHM

Background for Nordic Model

• Collective agreements the main regulatory device for terms and conditions of employment

• High organisational density

• Coordination between industrial relations, welfare state and macro-economic policies

• High degree of socio-economic equality and competitiveness

Page 5: Global Trends and Nordic Labour Markets - BHM

Trend 1: Transition to wage moderation and flexibility

Page 6: Global Trends and Nordic Labour Markets - BHM

Trilemma for Nordic model

Full Employment

Page 7: Global Trends and Nordic Labour Markets - BHM

Nordic model survived…

Balance between wage-moderation, flexibility and self-regulation secured (Finland pending…)

Wage-moderation and flexibility has not (yet) erodedsocio-economic equality

Trade unions and employers still strong organisations

State has been facilitative (Common Declaration, National Mediation Office, TUPO and Solidarity-Inivitative)

Welfare state and unemployment benefit supports collective bargaining

Page 8: Global Trends and Nordic Labour Markets - BHM

Coordination: The Danish Example

1. Manufacturing

norm

2. Federate level bargaining

3.a Yes in union ballot. DA ratifies

3.b Bargaining breakdown

4. Mediation

5.a Yes in union ballot. DA ratifies

Agreement in line with norm

5.b Breakdown and

concatenatedmediationproposal

6.a Yes in union ballot. DA ratifies

Agreement in line with norm

6.b No in ballot

cross-sectorstrike

7.a Agreement

in accordancewith power

relation

7.b Governmentintervention

High degree of coordination around labour cost normBut also flexibility in wage agreements through local bargainingRequires local bargaining capability and responsibility

Page 9: Global Trends and Nordic Labour Markets - BHM

Wage Moderation? Developments in Unit Labour Costs(entire economy, 1990-2012)

0

1

2

3

4

5

6

7

Tyskland Finland Sverige Danmark Italien UK Norge Island

1990-94

1995-99

2000-08

2009-12

Source: OECD.stat

Page 10: Global Trends and Nordic Labour Markets - BHM

Trend 2: Precarious work in the knowledgeeconomy

Page 11: Global Trends and Nordic Labour Markets - BHM

Knowledge economy

15

20

25

30

35

40

45

50

55

20

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14

Labor force with tertiary education (% of total)

DNK

FIN

ISL

NOR

SWE

CAN

Source: World Bank

Page 12: Global Trends and Nordic Labour Markets - BHM

Precarious work and Non Standard work

Source: EuroFound

Page 13: Global Trends and Nordic Labour Markets - BHM

Precarious work and Non Standard work

0

0,5

1

1,5

2

2,5

3

3,5

4

4,5

5

20

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20

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15

Temporary employees with tertiary education (index=2000)

Denmark

Finland

Sweden

Iceland

Norway

Source: Eurostat

Page 14: Global Trends and Nordic Labour Markets - BHM

Precarious work and Non Standard work

-0,5

0

0,5

1

1,5

2

2,5

20

01

20

02

20

03

20

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20

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15

Part-time employees with tertiary education (index=2001)

Denmark

Finland

Sweden

Iceland

Norway

Source: Eurostat

Page 15: Global Trends and Nordic Labour Markets - BHM

Challenges for academic self-employed/free-lancers

Source: Dansk Magisterforening 2014

Page 16: Global Trends and Nordic Labour Markets - BHM

Dualization: A question of cohorts?

0,0

2,0

4,0

6,0

8,0

10,0

12,0

14,0

20

01

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14

20

15

Youth unemployment, 20-29 years with tertiary education

Denmark

Finland

Sweden

Norway

Source: Eurostat

Iceland: 7.8 in 2011

Page 17: Global Trends and Nordic Labour Markets - BHM

• Exclusion• Not representing atypical workers to avoid the existence of atypical work altogether

• Subordination• Representing atypical workers primarily to avoid that they undercut typical workers

• Inclusion• Representing atypical workers interest by getting them at par standards

• Engagement• Representing atypical workers and letting their interests affect the organisation of trade

union (leadership, strategy etc.)

Source: Heery 2003

Trade union strategies for atypical workers

Page 18: Global Trends and Nordic Labour Markets - BHM

Trend 3: Organisation of workers and employers

Page 19: Global Trends and Nordic Labour Markets - BHM

Nordic Unions still strong, but…

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10

20

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50

60

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80

90

100

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02

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06

20

08

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12

Denmark

Finland

Iceland

Norway

Sweden

Source: OECD

Page 20: Global Trends and Nordic Labour Markets - BHM

Relationship between trade unions, employerorganisations and union density

Source: OECD and national statistics

0

10

20

30

40

50

60

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80

90

100

Sweden Norway Finland Denmark Iceland

Employer density

Bargaining Coverage

Union Density

Will employers still dance?

Or need for statutoryextensions or regulation?

Page 21: Global Trends and Nordic Labour Markets - BHM

Academic organisations are strong in Nordics

0102030405060708090

100

1994

1997

2008

Page 22: Global Trends and Nordic Labour Markets - BHM

Trend 4: Socio-economic inequality

Page 23: Global Trends and Nordic Labour Markets - BHM

Falling wage share

48

50

52

54

56

58

60

62

64

19

60

19

62

19

64

19

66

19

68

19

70

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14

20

16

Compensation per employee as percentage of GDP at market pricesper person employed (Denmark)

Yearly 5-year av.

Page 24: Global Trends and Nordic Labour Markets - BHM

Development in Wage Ratios (D9/D1 og D5/D1 in selected countries mid-1990 and 2011)

2,31 2,34

2,58

2,81 2,86

2.972,97

3,34

1,39

1,591,48

1,67 1,621.50

1,50 1,87

0

0,5

1

1,5

2

2,5

3

3,5

4

SE NOR FIN DK NLD FR GER UK

D9/D1 MID1990s

D9/D1 2011

D5/D1 mid-1990s

D5/D1 2011

Source: OECD

Page 25: Global Trends and Nordic Labour Markets - BHM

Wage ratio: High-tech manufacturing vs. low-techservices 1980-2007

1,20

1,40

1,60

1,80

2,00

2,20

19

80

19

81

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82

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07

Tyskland

Danmark

Finland

Sverige

Source: EU KLEMS

Page 26: Global Trends and Nordic Labour Markets - BHM

Wage premium for education

Source: E. A. Hanushek, et al. 2013

Individual bargaining can makesense for academics

Employers use salary for recruitment and retention (human capital theory)

Some benefits better colletive: leave, education, sick pay, pension

Individual bargaining higher pay-off but also more risky (womenlag behind!)

Page 27: Global Trends and Nordic Labour Markets - BHM

Scenarios for University Graduates

‘Business as usual’ – Still enough demand for graduates

Knowledge economy creates sufficient jobs

Reforms of ‘Business as usual’ – Tighter integration of supply of skills with labour market demands

Knowledge economy creates new types of jobs and universities have to follow

Fundamental change – Dualization

Knowledge economy does not create enough demand to match supply of graduates

Page 28: Global Trends and Nordic Labour Markets - BHM

• Increased dualization of labour market between insiders and outsiders• Drop in collective bargaining coverage means less parental leave, occupational pension etc.

• Outsourcing of medium to high cognitive task – nothing is sacred anymore?

• Increased use of atypical employment; project society, platform economy, etc.

• Representational Stretch! Work-life satisfaction and stress becoming more and more salient for some workers vis-à-vis ‘traditional’ issues like wage and working time for other works

• Individualization of terms and conditions requires bargaining power and skills –unions should help!

• Women seem to be systematically disadvantaged by individualized bargaining

Dualization of ‘Academic’ labour market

Page 29: Global Trends and Nordic Labour Markets - BHM

Discussion of Scenarios

What is the status of university educated workers and how are their options to get jobs just after university graduation?

How can gaps between typical and atypical workers be addressed?

How do trade unions see themselves and their role in the labor market of the future?

How has the development of salaries/wages been for workers with higher education? Too high, too low?

Page 30: Global Trends and Nordic Labour Markets - BHM

Discussion of Scenarios

How do we generate trust between the social partners and the government to be able to establish a well-functioning labour market model in Iceland?

What kind of institutional setup should be put in place?

Are/should wage increases in collective agreements be tied to a political strategy?

How are real wage increases and flexibility secured in collective agreements?

Page 31: Global Trends and Nordic Labour Markets - BHM

Tak for opmærksomheden!