AGEING AND EMPLOYMENT POLICIES The Netherlands Working Better with Age

1. Dutch Ministry of Social Affairs and Employment, Wednesday 16 April 2014 AGEING AND EMPLOYMENT POLICIES The Netherlands Working Better with Age Stefano Scarpetta Director for Employment, Labour and Social Affairs, OECD

2. Outline of the presentation The labour market situation of older workers in the Netherlands Key recommendations for the Netherlands Working Better with Age: the OECD review

3. THE Labour Market SITUATION OF older workers in the Netherlands

4. The effective labour market exit age in the Netherlands has reached the OECD average Women Men Source: OECD

5. The employment rate of 55-64s in the Netherlands is above the OECD average Employment rates (55-64), 2007 and 2013 As a percentage of the population aged 55-64 Source: OECD estimates based on national labour force surveys.

6. … but lags behind concerning working after 65 Employmentrates (65-69), 2007and2012 As a percentage of the population aged 65-69 Source: OECD, Working Better with Age, Netherlands – Figure 2.1.

7. A strong part-time culture in the Netherlands: 66% of women and 16% of men aged 55-64 work part-time compared with respectively 29% and 10% in OECD average Part-time work, 2012 As a percentage of employment in the age group Men Women Source: OECD, Working Better with Age, Netherlands – Figure 5.9.

8. Full-time equivalent employment rates of 55-64s are lower than the OECD average, particularly for women Employment rates (55-64) (%) adjusted by working hours, 2012 Men Women Source: OECD estimates based on national labour force surveys.

9. Long-term unemployment is high for those above the age of 55 Incidence of long-term unemployment (55+), 2012 As a percentage of unemployed aged 55+ Source: OECD, Working Better with Age, Netherlands – Figure 2.2.

10. The hiring of older workers in the Netherlands is well below the EU average Hiring rate by age group, 2012a Percentages a) For each age group, employees with job tenure of less than one year as a percentage of all employees. Source: OECD, Working Better with Age, Netherlands – Figure 2.6.

11. Inflows into disability benefits of 55-64s are lower than in 2002 but there is not enough focus on re-entry to workInflows into disability benefits between the age of 55 and 64, by gender, Netherlands, 2002-12As a percentage of the population in each group Source: OECD, Working Better with Age, Netherlands – Figure 3.2.

12. The Dutch age-wage profile of full-time workers is steeper than in Denmark, Sweden and the United Kingdom Indexes, age25-29=100, 2010 Source: OECD Earnings Database.

13. What more SHould be done in the Netherlands?

14. Working Better With Age: the Netherlands • In response to the 2005 OECD recommendations, the Netherlands implemented several substantial policy initiatives to encourage work at an older age but there are still challenges • The aims of the review are to: • Assess these policy initiatives and their impact on the employment situation of older workers • Identify areas where more should be done, covering both supply-side and demand-side aspects

15. First areaImproving work incentives • Promote longer contribution periods in second-pillar pension schemes and increase flexibility in withdrawal and combinations of pension and work to encourage longer careers • Reduce the maximum duration of UI benefits combined with better activation of all unemployment benefit recipients, including for the unemployed over 60 who are receiving Income Compensation for Older Unemployed (IOW) • Keep replacement rates of sickness and disability benefits below 100%, and give access to wage-compensation already in the sickness benefit period for re-entry to new jobs with a lower wage

16. Second areaTackling employment barriers on the side of employers • Encourage the social partners to adjust wage setting procedures by focussing more on performance and less on tenure and seniority • Ensure that new practices among innovative firms in the Sustainable Employability programme are promoted and progressively become national standards • Better targeting of measures to reduce cost disadvantages, increase employability and promote recruitment of older workers

17. Third areaImproving the employability of older workers • Link training measures for older unemployed directly to a specific job • Tighten co-operation between the Public Employment Service and the municipalities to increase re-entry to work for the older unemployed • Mobilise more fully labour resources by supporting initiatives to facilitate working on a full-time basis or longer working hours for part-time workers

18. Working better with age The OECD review

19. The first OECD review on older workers: Live Longer, Work Longer • 2003-2006 OECD review • 21 country reports (including the Netherlands in 2005): • Ageing and Employment Policies • And a synthesis report (2006):Live Longer, Work Longer • Agenda for policy actions in three broad areas to encourage work at an older age: • Rewarding work • Changing employer practices • Improving employability

20. Follow-up review: policy review, empiricalstudy and country studies • Policy review: recent reforms and measures presented in 21 country notes (situation mid-2012)http://www.oecd.org/els/employment/olderworkers • 2013 Employment Outlook: focus on changes in labour market outcomes for older workers since the start of the global financial crisis • Country case studies • Norway: publication in 2013 • France, Netherlands, Switzerland and Poland: publications in 2014 • Denmark, Korea and Slovenia: publications in 2015 • Policy synthesis report end-2015

21. Thank you! For further informationhttp://www.oecd.org/els/employment/olderworkers