The policies of unemployment protection in Europe

The abundant literature on welfare state policies, regimes or ‘worlds’ has been only limitedly interested in unemployment protection, and even less in youth unemployment protection. What is clearly lacking in the literature is an updated analysis of the most recent policies developed in European countries targeting youth. This mini‐symposium aims to fill in this gap by presenting findings from an EU‐funded research project entitled ‘Youth, Unemployment and Exclusion in Europe: A Multidimensional Approach to Understanding the Conditions and Prospects for Social and Political Integration of Young Unemployed’ (YOUNEX). The main aim of the research endeavour was to develop theory and contribute to empirical knowledge concerning the social and political exclusion of unemployed youth in Europe.     

Explaining differences in unemployment benefit takeup between labour migrants and Dutch native workers

The large increase in Eastern European migrants entering the Dutch labour market has led to concerns about their potential claim on Dutch unemployment benefits. We use a decomposition analysis to investigate differences in uptake of unemployment benefits between migrants and native Dutch employees by analysing register data for all employees in the Netherlands in 2015. The results show that Eastern European migrants, similar to other migrants, receive unemployment benefit more often than native Dutch employees. This difference can be largely ascribed to job characteristics. The inclusion of unemployment risk in the analysis reveals that non-working migrants are much less likely to receive unemployment benefits than Dutch natives.     

Institutions and structures as barriers? A comparison of native‐born and immigrant unemployment durations across 12 European countries

This study investigated the effect of institutions on the unemployment duration gap between non‐EU immigrants and native‐born in 12 European countries. Going further than the existing literature, our study encompassed unemployment duration, distinguishing between exits to inactivity, primary and secondary employment. Additionally, we have provided a stronger micro‐foundation to the comparative literature by introducing institutional measures for unemployment‐related benefits at the individual level rather than merely using aggregate proxies. Our analysis found no disincentive effects of benefits for immigrants. Furthermore, the employment prospects of immigrants were better when the demand for low‐skilled labour was high, and immigration policy was labour market‐oriented. In contrast, employment protection legislation did not affect the unemployment duration of immigrants.     

Mandatory occupational welfare: Severance pay as an unemployment compensation instrument

This study focuses on the conceptual and empirical development of severance pay (SP)/redundancy pay schemes established through centralized collective agreements (in Nordic countries) and legislation for unemployment compensation. It argues that these “mandatory” occupational welfare benefits have been neglected in social policy debates due to the ambiguity in their conceptualization, overemphasis on their cost implications, and the nonrecognition of their redistributive effects. The study offers quantitative indicators to analyse SPsapos; redistributive structure (coverage, generosity, and benefit equality) during the Global Recession in Canada, the United Kingdom, Australia, Ireland, France, Germany, Austria, Spain, Portugal, Denmark, and Sweden. The findings demonstrate that SP schemes possess distinctive elements in Southern European, Continental European, Anglo-Saxon, and Nordic clusters. The indicators are also used to analyse the interplay between these schemes and unemployment insurance/assistance in these clusters.     

Comparing unemployment protection and social assistance in 14 European countries. Four worlds of protection for people of working age

Pfeifer, M. Comparing unemployment protection and social assistance in 14 European countries. Four worlds of protection for people of working age This article aims to show which policy responses 14 Western European countries have adopted to deal with rising unemployment levels and increased need for benefits during working age. In contrast to earlier studies, both components of unemployment benefits (UB), i.e. unemployment insurance and unemployment assistance, were taken into account in a social rights indicator that depicts the legal entitlements of the unemployed. In total, there were eight indicators of both UB and social assistance representing expenditure, generosity, problem pressure and benefit entitlements. The following cluster analysis groups countries using these indicators. The resulting typology consisted of four ways of protecting the working‐aged: an extensive safety nets type operating well with functioning labour markets; a liberal protection type dealing with low levels of unemployment; a targeted protection type combined with an insider–outsider divide on the labour market; and lastly, a patchy safety nets type facing high unemployment levels.     

Social assistance and minimum income benefits in old and new EU democracies

Nelson K. Social assistance and minimum income benefits in old and new EU democracies Int J Soc Welfare 2010: 19: 367–378 © 2009 The Author, Journal compilation © 2009 Blackwell Publishing Ltd and the International Journal of Social Welfare. In this article, social assistance developments are analysed in a large number of European Union (EU) member states, including European transition countries and the new democracies of southern Europe. The empirical analysis is based on the unique and recently established SaMip Dataset, which provides social assistance benefit levels for 27 countries from 1990 to 2005. It is shown that social assistance benefits have had a less favourable development than that of unemployment provision. Hardly any of the investigated countries provide social assistance benefits above the EU near‐poverty threshold. Social assistance benefit levels have not converged in Europe. Instead, divergence can be observed, which is due mainly to lagging developments in eastern and southern Europe.     

Welfare regime change – or lack of change – in unemployment compensation

Drawing on theoretical accounts of institutional change, this study explored the politics of welfare regime transformation in regard to Turkey's unemployment compensation system. By using the institutionalist approach, the study shows that the process of welfare regime change was one of “institutional layering” of unemployment insurance (UI) over severance pay. Also, the study demonstrates that the economic bureaucracy played a key role in pushing the establishment of UI (state‐centric approach) in contrast to the class‐based organizations that focused their struggles on the severance pay scheme (power‐resource perspective). However, the economic bureaucracy preferred a rudimentary UI design, which prevented UI from undermining the vested interests behind the severance pay scheme. Furthermore, subsequent attempts at the reformation of the severance pay scheme were not successful because the social welfare bureaucracy lacked the capacity to develop a policy alternative to resolve the stalemate between the societal actors. Lastly, the study used the successful severance pay reform experiences of South Korea and Austria to locate the Turkish case within a broader comparative framework.     

The challenge of youth unemployment

This article was prepared as a contribution to the ILO's Action Programme on Youth Unemployment. It presents an overview of the youth unemployment problem and youth employment policy principally from a European perspective, although it is hoped that much of the comment and analysis is relevant to afar broader range of countries. In the first section, which considers the nature and causes of youth unemployment, it is shown that its basic cause is aggregate demand rather than high youth wages or the size of the youth cohort, and suggests that a successful strategy for dealing with the problem must take this into account. In the second section, dealing principally with the examples of Germany and the United Kingdom, a number of factors are identified which influence the effectiveness of youth employment policy. In particular, it is found that precise targeting of programmes and the involvement of employers' and workers' organizations, as well as government, in the design and implementation of policy are both important determinants of an effective policy. A third section attempts to set the analysis in a more general context.     

The impact of the twin financial crises

We focus on the first 20 years of the Euro, from 1999 to 2019, and we split this period into two approximate decades to examine the performance of three benchmarks: the real GDP quarterly growth, the annualized real per capita GDP changes and unemployment. These illustrate that the underperformance of Europe is more evident during the second decade. Searching for causes we find that the Global Financial Crisis was an exogenous shock to the EU but its impact was large in both the U.S. and the EU. One major reason is that the U.S. responded quickly and aggressively both fiscally and via an unconventional monetary policy. The Euro area was constrained by a European Central Bank that focused on price stability, and fiscal policy was not much of an option. The second shock of the Sovereign Debt Crisis was endogenous to the Euro area and it, more than the Global Financial Crisis, revealed the original weaknesses and fragility of the European monetary union. This financial fragility quickly translated into declines in aggregate demand and economic underperformance.     

Regional labor market adjustment to structural shocks: An international comparison

Previous research indicates that local industry composition significantly influences unemployment in the American Rust Belt. This paper uses a dual market model to compare evolutions of structural joblessness in German regions with those of a Rust Belt area in the United States. Results indicate that German labor markets exhibit both intriguing similarities and differences to the US benchmark case. In particular, the contrasts between the two areas highlight the less distinct labor supply flexibility of Western European labor markets as demonstrated by unemployment responses to changes in regional employment prospects.     

Comparing Formal Unemployment Compensation Systems in 15 OECD Countries

This study contributes to the welfare regime literature by analyzing unemployment compensation programmes – unemployment insurance (UI)/assistance (UA) programmes and redundancy pay schemes – of welfare state/occupational welfare regimes. It covers 15 countries of the Organisation for Economic Co‐operation and Development (OECD) selected from Southern European, Liberal, Continental‐corporatist and Social Democratic country clusters. In contrast to the common argument that Southern European countries have underdeveloped formal unemployment compensation systems, this study argues that they (especially in Spain, Portugal, and to some extent Italy) are comparable in strength to those in Continental‐corporatist countries if occupational welfare programmes – notably redundancy pay – are considered alongside welfare state programmes for unemployment protection. The study also outlines the characteristics of redundancy pay schemes in the four country clusters and shows how different redundancy pay schemes are linked to UI/UA schemes in these clusters.     

Europeanisation and the Youth Guarantee: The case of France

In 2013, the European Council approved the Youth Guarantee (YG) to counteract youth unemployment. Because of its specific features, the YG is useful for understanding whether the EU has triggered policy change in national youth unemployment policies. Contrary to most of the literature on similar topics, we focused in this study on the effect of this specific European measure rather than on broader EU strategies or policies. The study contributes to the literature by qualifying the degree of fit/misfit and suggesting a counterfactual analysis, using the case of France. We first situate the article within the broader Europeanisation debate and present our research design. The second section introduces the policy structure of the YG and investigates youth unemployment policy in France, prior to and after the European initiative. The third section discusses whether the French youth unemployment policy would have been developed in the same way without the YG. A final section concludes.     

Patterns and meaning of unemployment

This article introduces the special issue. Unemployment in Argentina, the Netherlands, Poland and Spain is placed in the context of global economics. The end of full employment in Sweden was part of an international deinstitutionalization that connected employment closely to economic growth. The immediate causes of the economic decline and mass unemployment in Sweden were a financial crash and neoliberal government policies. The ambiguity of unemployment in the criteria for evaluating the performance of policy-makers and three different cultures among unemployed people are outlined. An overview of what is known about the consequences of unemployment in terms of excess illness and mortality is given.     

Are European social safety nets tight enough? Coverage and adequacy of Minimum Income schemes in 14 EU countries

Figari F, Matsaganis M, Sutherland H. Are European social safety nets tight enough? Coverage and adequacy of Minimum Income schemes in 14 EU countries This study explored and compared the effectiveness of Minimum Income (MI) schemes for persons of working age in the European Union (EU). Using the European microsimulation model EUROMOD, we estimated indicators of coverage and adequacy of MI schemes in 14 EU countries. In terms of coverage, we found that in several countries, some individuals are ineligible for MI even when they fall below a poverty line set at 40 per cent of median income. With respect to adequacy, we show that in certain countries, a large fraction of those entitled to MI remain at very low levels of income even when MI benefit is added. Overall, our findings suggest that MI schemes in Europe remain divergent, and that their clustering may be more complex than has hitherto been allowed for. Key Practitioner Message: ?The ability of European welfare states to fight poverty is a key policy question, especially at times of crisis;?Adequacy and coverage of Minimum Income schemes are crucial aspects of the answer;?Microsimulation allows us to separate the effectiveness of MI schemes ‘by design’, from issues of benefit administration, targeting errors and so forth.     

Disability benefit reform in Great Britain from the perspective of the United States

In 2008, Great Britain overhauled its disability benefit programme by introducing a new disability determination process called the Work Capability Assessment and a new earnings replacement programme called Employment and Support Allowance. This article examines the British reforms from the perspective of the United States, which may consider changes to its disability benefit programme, the Social Security Disability Insurance programme, in the near future. The article provides an overview of the steps leading to the reform in Great Britain, details how the new programme operates, reviews research on its initial implementation and effects, and identifies lessons for the potential reform of the disability benefit programme in the United States.     

Job-Seeking Behavior in Young Adults: Do Unemployment Insurance Benefits Hurt Job Search Efforts?

ABSTRACT. The purpose of the present study was to evaluate the association between extended unemployment insurance (UI) benefits and young adults’ job-seeking behavior. In particular, the study evaluated if the extension of UI benefits to 99 weeks in 2008 had direct effects on job search efforts. Three waves (2007–2009) of data (N = 915) from the National Longitudinal Survey of Youth were analyzed using multiple regression models to assess the association of UI benefits to young adults’ job search efforts. Additionally, the homogeneity of slope coefficients of the UI benefit on job search effort was evaluated across 3 years using an analysis of covariance (ANCOVA). The results of regression analyses suggest that UI benefits were negatively associated with job search efforts for 2007 and the pooled sample of 2007 to 2009, but the relationship was not significant for 2008 and 2009. The results of the ANCOVA suggest that the UI benefit extension of 2008 did not have any negative association with job search efforts. Future studies should explore the subjective experiences and decisions young adults make in consideration of unemployment, UI benefits, and job search efforts.     

The welfare state as a context for children's development: a study of the effects of unemployment and unemployment protection on reading literacy scores

Data were analysed from the Organization for Economic Cooperation and Development (OECD) Program for International Student Assessment (PISA) to examine whether the relationship between parental unemployment status and child reading literacy is modified by the level of unemployment protection provided by the nation. The sample consisted of 61,946 children, nested in 3,918 schools among 17 market economies. The results of multi-level analyses indicated that, after controlling for a range of individual, family and school covariates, children with unemployed fathers in all countries had significantly lower reading literacy scores than those of employed fathers (β = −8.84, SE = 2.01). The contextual effect of unemployment protection was not significant after accounting for fathers' employment status (β = −18.63, SE = 16.26). However, there was a significant negative interaction between unemployment protection and fathers' unemployment, yielding the unexpected suggestion that, in countries with higher levels of unemployment protection, children with unemployed fathers fare worse, both in relation to children with unemployed fathers in lower protection countries, and in comparison with children with employed fathers (β = −26.96, SE = 8.08). Possible explanations are advanced for this result, including the potential for a 'discouraged child effect' arising from the potential association between unemployment protection and higher local unemployment rates (though unemployment rates at the national level were not significant).     

A Social-symbiotic Approach? EU Industrial Policy and the Pharmaceutical Industry in the EU

The purpose of this paper is to develop the debate about a symbiotic approach to industrial policy with respect to the pharmaceutical industry in the EU. The EU has an increasingly important role to play in European markets but it seems, at best, to be following a fragmented industrial strategy. There is a real and growing danger that this strategy becomes worse for everyone than no strategy at all. Thus the EU can either go for a comprehensive and comprehensible strategy or let the industry fend for itself amongst disparate health care systems amongst member states. Alternatively it can continue to stumble along with a pastiche of policies. There are signs of some debate about a more holistic approach to industry. In the European Union for example DG (Directorate General) V and DG III produced a communication arguing that “the [European Union] Community policy in favour of the pharmaceutical industry must take notice of [the] twofold context of public health and social security” (Com(93)718:3). This paper identifies current fragments of EU pharmaceutical industrial policy and indicates what a social-symbiotic approach is. Whether or not the industry in the EU continues to decline with respect to the industry elsewhere Asia and America in particular, the sick people of the EU will still need medication: a symbiotic approach to industrial policy can help stem the relative decline in the EU and indeed could reverse it.     

Alike but not alike: Welfare state and unemployment policies in Southern Europe. Italy and Portugal compared

Although Italy and Portugal are considered to be part of the same welfare state family – the Southern European one – analysis of a key component of the welfare state, namely, unemployment policies and regulations, reveals a different evaluation. A comparative analysis of a series of specific indicators of Italian and Portuguese unemployment regimes shows that they represent two different models. Portugal appears to be a more inclusive system, closer to continental or Northern European countries than it is to Italy, or at least representing a hybrid system that combines characteristics of continental European welfare states with characteristics that are more typical of Southern European welfare states. Italy, on the contrary, is much more clearly a Southern European welfare state.     

Social Policy in a Federal Europe

The European Union has a federal structure, in which each citizen is subject to two governments. The position of social policy within the federation is contested, but the EU has gradually developed powers through the extension of its competence, direct intervention in social welfare issues and the push for “convergence”, or agreement on minimum standards. Consistent with its federal nature, the European model of the welfare state is based on convergence, integration of the excluded and social protection through the gradual extension of solidarity. The precise role that the federal government will take on within this is unclear, but it is already having a major impact on social welfare and its influence is likely to increase.