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A Polarised Labour Market in a Polarised Society. Miroslav Beblavý (CEPS), Lucia Kurekova (SGI), Ilaria Maselli ( CEPS), Barbara Vis (VU), Frank Vandenboucke (KUL). Introduction. Polarisation of what? Context How is each group (low/middle/high skilled) changing in the process?.
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A PolarisedLabour Market in a Polarised Society Miroslav Beblavý (CEPS), Lucia Kurekova (SGI), Ilaria Maselli (CEPS), Barbara Vis (VU), Frank Vandenboucke (KUL)
Introduction • Polarisation of what? • Context • How is each group (low/middle/high skilled) changing in the process?
Is it happening? The UK plus other 16 countries Belgium plus other 7 countries High skilled jobs Low qualified jobs High skilled jobs Medium skilled jobs Low qualified jobs Medium skilled jobs
The shrinking middle: routine workers • Pay a penalty for doing a routine job • Even though they became more sophisticated (trained, use a pc, educated, etc), the penalty for a routine job increased between 2000 and 2010 • => the owner of the capital captures a bigger share of income
Consequences of job polarisation • A risk of skills mismatch > a new problem: excess of middle skilled workers! • Higher income inequality • Lower social mobility
Questions • Who are the low-skilled across Europe? • What skills do employers seek in low and medium skilled jobs?
Low-skillness is diverse across EU • The character of low-skillnessdiffers across-countries • South-Eastern Europe versus Central and Eastern Europe • Even within a country, same education level leads to different labor market outcomes • Age/experience, gender, ethnicity, nationality
Low-skilled job are demanding • A wide range of skills and characteristics are listed in vacancies for low-skilled occupations • Experience matters nearly everywhere • Service sector occupations typically demand more non-cognitive skills than other types of occupations
Demand in low-skilled jobs is diverse • Labor demand across countries differs in importance given to cognitive skills versus other skills (cognitive versus non-cognitive) • No universal type of demand or synchronized shift towards other skills • Domestic institutions and structures shape very strongly how demand is structured
Summary • The character of low-skill job has changed during the past decades: a variety of skills is requested from workers • Diversity in low-skilled supply and demand across Europe
Policy implications • Education and skill formation policy - importance of experience is likely to grow • Labor migration policy and migrant integration policy - tool to address rising inequalities and fast-changing skill needs • More targeted policies and interventions might be necessary - growth of socio-economic inequalities along ethnic, gender and age lines
As quantity increases...(1): lessons from the expansion of secondary education Upper secondary sectors expanded at different speeds in different countries General education tended to grow at the expense of vocational education (the position and popularity of vocational schooling has been diverse across countries) As the enrollment rates exceed 80%, the generalization of the upper secondary schooling seems to have spilled to the bachelor studies Although elite, mass and universal access to education are analyzed as sequential stages of educational expansion, expansion can reproduce social stratification
As quantity increases…. (2) • WHAT to study more important than IF Net Present Value of Education, 5 years from graduation, male students. Average = 100
Which Social Policy Fits such a Shift? From the micro to the macro level!
Are Social Investment Policies the Answer? • Combine “old” re-distribution with investment • Relatively cheap • Increase in, say, childcarespending of 0.5% of GDP is highlyvisible • Can increase both economic growth (increased labor participation) and quality of labor force (through human capital development)
Wrap-up and Possible Future Developments • Job polarisation and polarisation between countries • Educational expansion likely to continue • Public finance constraint as well….if social investment is added, how will the investment be done? • Risks of social / intergenerational conflict (higher education fees)
We are not the firsts to worry about these issues! “It is not open to question that, by closer coordination, the existing social services could be made at once more beneficial and more intelligible to those whom they serve and more economical in their administration”. William Beveridge, from the Beveridge report (1942) (page6)
