2.5. Unemployment rates and workforce ageing
The nature of work is changing rapidly. Today’s world of
work is unrecognisable from the workplace of only a few years ago. Employers
and employees have embraced revolutionary communication advances, the
introduction of flexible working arrangements, greater diversity in the
workplace and significant restructuring of working arrangements through
outsourcing and off-shoring. General trends include changing work patterns (new
technology, increase of the service sector) as well as changes in employment
patterns (downsizing, outsourcing, flexibility and mobility). In response to
globalisation and economic pressures, companies have looked for greater
flexibility to respond rapidly to peak production demands and seasonal
variations whilst controlling labour costs. Their approach has included
introducing new working practices such as ‘just-in-time’ production and casual
labour such as temporary work and fixed-term contracts. 2 For many people, change
provides welcome opportunities for more rewarding and satisfying work and a
better life. For others it is worrisome, closing off rather than opening up
chances for improved living and working conditions (ILO, 2006).
All these issues can have implications for workplace
health and safety. They can affect the type and nature of risks present in the
workplace and they influence how risks need to be managed. For example, in many
work areas, job demands have increased, including an intensification of work
and requirements on workers to be more flexible and rapidly learn to carry out
new tasks. These conditions can contribute to health problems, although
traditional risks also remain on the agenda. Changes in management structures
and responsibilities will affect the management of workplace health and safety.
The use of subcontractors, for example, also complicates the process,
especially where several different organisations are working on one site
(European Agency for Safety and Health at Work, 2002).
Detecting a pattern of change in working conditions is
difficult as the main feature revealed by labour market researchers is an
increasing diversity. The situation is even more complex for workers from the
new member states (i.e. Eastern European countries). In many of these countries
the traditional occupational health and safety hazards still constitute the
main challenge. But, simultaneously, new ways of working are bringing their own
problems for employees. One of the most pressing problems is that most
employment relationships are informal and insecure, hampering the transition to
more complex and productive systems for organising productive work.
Growth of the service sector. A growing proportion of workers
are employed in the service sector. In contrast to industrial employment,
services went up as a share of global employment from 66 per cent in 1995 to 71
per cent in 2005 in developed countries. Services include wholesale and retail
trade; hotels and restaurants; transport; storage and communications; finance;
property and business activities including research and development; public
administration; education; health and social work; community and personal
services and domestic service. Many of these jobs involve contact with members
of the public — clients, customers, patients and so forth — which can lead to
risks of stress and violence at work. The necessity to carry out additional
administrative tasks has increased in professions such as health-care work and
teaching and there has been an increase in delivering health and social
services care in the community, thus more personnel working away from a fixed
workplace.
Integration and globalisation. The progressive reduction of
barriers that first took place between local and national, then regional and
now intercontinental markets is a dominant topic in recent economic history.
Liberalisation of trade controls on manufacturers, an easing of restrictions on
foreign direct investment and other capital movements, as well as sharply
reduced costs of transportation and telecommunications, have fostered the
emergence of a global market economy. More businesses face fiercer competition
in their domestic and export markets. As a result of these changes, intensified
global competition for products and services feeds through into pressures to
adapt workplaces and match the efficiency and quality of market leaders – or
close down.
Changing management structures. According to the Agency Changing
World of Work Report, several significant new developments in work organisation
have emerged, for example: teamwork; decentralisation of supportive tasks such
as quality and maintenance; job enlargement, job rotation, including
interdepartmental job rotation; knowledge management; tele-working; virtual
networks and new working time patterns. Some of these changes have been
introduced from a management efficiency perspective; others with the aim of
improving work organisation and quality of working life for the employees. The
study, entitled “High performance work place practices and job satisfaction”,
reveals that high performance work practices do indeed have a positive effect
on work satisfaction (EUROFOUND, 2005). Key factors for workers’ well-being are
autonomy in the workplace, participation in decision-making and increased
communication with colleagues. However, the research concludes that teamwork,
job rotation and supporting human resource practices have only a limited
impact.
Unemployment rates. During the period 2006-2007 6.5
million new jobs have been created. In the EU27, unemployment rate declined in
the last years down to 7%, the lowest level ever achieved since the 80s. Figure
2.3 shows the significant differences existing among unemployment rates of
different Member States and that unemployment rates are for people aged less
than 25 much higher than for those 25 or more years old. Unemployment rates
will likely increase due to the current economic situation. Recent estimates by
EUROSTAT3 indicate that the employment rate in the third quarter of
2008, compared with the previous quarter, is stable in the EU27, and slightly
declining in the Euro area.
Figure 2.3a. Unemployment rates in the age groups 15-24 years and
25 years and over in the EUGLOREH Countries. A) 15 – 24 years
Figure 2.3b. Unemployment rates in the age groups 15-24 years and
25 years and over in the EUGLOREH Countries. B) 25 years and over
The first trend is the ageing of the workforce. In all
European countries, the average age of the workforce is rising and the
percentage of workers over 50 will continue to grow. By 2006 it had reached the
stage where employees in their fifties outnumbered those in their thirties. A
forecast compiled by Eurostat shows that the number of older workers (aged 55 to
65) will increase by almost 9% from 2005 to 2010, but the number of young
adults (25-39) will decrease by 4% in the same period. This trend will continue
from 2010 to 2030 (older workers + 15.5%, young adults -10%).
A possible trend that may in part counterbalance this
structural contraction is a greater involvement of 55- to 64-year-old people in
the labour market, especially of women and the very young, provided more
part-time jobs are offered. The trend in the participation rate of the “young
elderly” in the labour force started declining from the 1970s onwards, mainly
as a result of an increasing number of retirees in the farming sector on the
one hand, and more flexible work retirement schemes on the other. This decline
was particularly sustained for the male section of the population, while trends
for women of the same age brackets varied widely across developed countries.
Many countries took steps to increase retirement age, but nonetheless the age
when the labour force actually leaves their jobs comes short of that provided
for by the law.
In 2004, the European
Commission, DG Employment and Social Affairs, released the Communication on “Unequal
Welfare States, Distributive Consequences of Population Ageing in Six European
Countries”. As retired people generally have lower incomes than employed
workers, ageing will lead to a slight rise in income inequality in Europe in the next 20 years. Larger numbers of people with lower incomes will in turn lead
to higher poverty rates. The 15th edition of the European Commission’s Employment
in Europe report, published in early October 2003, presented a panorama of
recent developments in European labour markets. The report integrates accession
countries into the analysis. The report highlights the EU’s commitment to
increase the number of older people in work to 50% (the Stockholm target) and
to raise the age at which people retire by 5 years (the Barcelona target).
Statistics in 2001 show that the average retirement age is 59.9 years and in
2002 only 30% of older people were in work in the accession countries compared
to 40% in the EU. Although recent progress has been made in some Member States
towards meeting these targets, the report highlights the importance of
work-health issues for older workers. In low-skilled jobs greater attention is
needed for health and safety issues because of muscular-skeletal disorders.
Higher skilled workers face the challenges of stress and the associated health
impact.
Active inclusion measures, pension and labour market
reforms have improved incentives to work but still more people need to work.
Furthermore, they should stay economically active longer. Together with efforts
to improve productivity, this will contribute to a sounder base for social
protection systems and adequacy and sustainability of pensions. In view of
people’s improved health status and life expectancy, reforms and modernisation
of pension systems can promote active ageing by raising employability, reducing
early retirement schemes, increasing flexibility in retirement and
strengthening incentives to work longer, provided that labour markets are
opened up to older workers.
A second trend is the increasing percentage of women
in the workforce. However, it is uncertain to what extent jobs have been
changed on the basis of this aspect. Traditional differences remain in the type
of jobs carried out by men and women, the type of employment contracts and in
career development opportunities. Many women work in the caring services where
there are high risks of stress, violence and psychosocial risk factors. More
women than men work in jobs where the demands are high but there is little
individual control over the work.
A third trend is immigration of new groups into European
Member States.
Migrant workers include two major categories: the highly
skilled, much sought-after employee who can usually obtain the necessary papers
to live and work in the host country and the unskilled, who are often equally
in demand but for low-status/low-paid jobs that few nationals want to do. The
unskilled often have difficulty in obtaining visas and work permits and are
concentrated in unskilled jobs characterised by poor working conditions. An
additional problem in these jobs is that written health and safety notices are
important but ineffective if they are not in a language workers can read or if
literacy levels are weak. Recent studies show that the position that recent
migrant workers occupy within the labour market puts their health and safety at
increased risk, in comparison with other workers in similar positions.
According to estimates, the number of Europeans of working
age (between 15 and 64) will shrink by 20 million by the year 2030, even taking
into account 1.8 million immigrating into the EU every year.
According to recent European Commission’s figures,
there are three million unfilled jobs in Europe. Growing labour needs are
mainly in highly qualified labour as well as in low and medium skills in
specific sectors, namely in healthcare, agriculture, construction and tourism.
Growing needs in domestic and care services are as
follows:
–
The 80+ age group – an
important consumer of care services – represents the fastest growing age group.
It doubled in size in the period 1970-2000 and will double again before 2030;
–
The feminisation of the
labour force and changes in the family structure and lifestyle have
significantly increased the demand for domestic services.
The impact of migration on overall growth very much
varies by country, but generally in many countries its contribution has
increased over time. However, it is unrealistic to believe that migration can
offset the enormous inertia of ageing. After all, migrants are also ageing.
Nevertheless, migration can smooth the ageing pattern providing extra time for
the policies to adapt.
The situation in Europe in terms of migration is far
from satisfactory. In relation to skill level, Europe attracts less high
skilled immigrants and more low skilled immigrants compared to the USA, Australia and Canada, while vacancies in highly skilled jobs are increasing. In relation to
labour market participation, participation/ employment rates of immigrants and
their descendents remain low in many Member States. Illegal migration
contributing to irregular work remains high. Almost in all Member States the
integration of immigrants represents an important issue. Immigrants are among
the most vulnerable groups. The fight against discrimination represents an
important dimension of this issue.
New forms of work. Modern organisations are often more
decentralised and may use ‘lean production methods’. The result of these
changes has been a reduction in directly employed staff. Many companies now
only carry out core functions in-house, while auxiliary functions have been
outsourced. This results in chains of suppliers and subcontractors. The way
organisations operate and work together with others has become more complicated
and less stable. There is now more instability in work contracts and job
descriptions. Companies make greater use of short-term contracts, temporary
employees, freelancers or self-employed people. Increasingly, employees are
flexibly deployed over multiple tasks. Some contractual relationships have
become more informal. More use is made of part-time workers, with women making
up the majority. New technology may also influence the way people are employed,
for example by creating more possibilities for people to work self-employed
from home (European Agency for Safety and Health at Work, 2006).
Both case studies and quantitative data show that
employees with a temporary or fixed-term contract have less job security, less
control over their working time, fewer career prospects, reduced access to
training and perform less skilled tasks. These issues can result in
work-related stress. Studies have showed that an increase in work-related
stress also increases cardiovascular mortality (Finnish Heart Association,
2005). These issues have a gender dimension, since women are relatively
over-represented in non-permanent and part-time jobs (Rantanen, 1998).
The introduction of new technologies can be a stressful
experience at an individual level for some workers. The pressure of
information-intensive work and the learning process may be particularly
stressful for some older workers. Nevertheless, ‘information overloads’ and
psychological stress are not restricted to older employees or those with low
training levels; ICT experts have also shown an elevated risk of psychological
exhaustion (Rantanen, 1998). The use of and exposure to new technological
products, little known for their biological effects, such as nano particles,
may result in new risks to workers’ health.
New qualifications. The current process of economic and
technological transformation requires a constant renewal of skills by workers,
employers and managers and favours those countries more capable of meeting this
demand. In other words, current growth is skill-biased in developed countries.
Perceived lack of control over work is a well-documented factor that
contributes to work-related stress, which also increases cardiovascular
mortality. In industrialised countries, high-skilled occupations, including
professional, technical, and administration categories, recorded the highest
growth of all occupations in the 1980s and 1990s. Given the skill-biased nature
of the current economic and technological transformation, worker training
(formal education, vocational training and training in firm-specific
activities) assumes an increasingly crucial role to assist individuals in
developing skills to find and retain formal employment.
Pension provision. Whereas pension reforms are well
under way, they need to be monitored regularly with regard to their impact on
future adequacy and financial, economic and social sustainability. Awareness of
the risks associated to different pension schemes should be raised, thereby
promoting informed choices. Work on the methodology for comparative analysis
and the exchange of good practice should provide insight into the long term
impact of pension reform on individuals, particularly for those with atypical
career patterns.
Privately funded pension schemes are of growing
importance. This generally means a shift in the sharing of risks between
beneficiaries, governments, sponsoring undertakings and pension funds, which needs
to be well evaluated and accompanied by appropriate regulations. The full
impact on the adequacy of future pensions is not easy to assess and depends on
the size of contributions diverted to funded schemes and on their actual
coverage. While fuller and more productive employment is more likely to offer
access to private pensions, specific policy measures seem necessary to increase
coverage currently at 50-60% on average to ensure that the whole working
population will accumulate sufficient private pension right – an objective set
by many Member States. Future pension benefits will also depend on real returns
on accumulated capital as well as actual costs and fees – which can affect
lower pensions to a greater extent. In those Member States introducing greater
reliance on private pension provisions the mechanisms for transition are still
in evolution. The age at which people join funded schemes, the retirement age
and the rules governing the accumulation and payment of benefits, such as
indexation rules and the treatment of non contributory periods, can have a
strong impact on future pension incomes. But funded schemes also need to adapt
to the increase in life expectancy. With increased reliance on funded pensions,
the government’s role needs to be clearly defined. This involves the definition
of pay-out conditions, appropriate supervision, public information and
financial literacy (Joint Report on Social Protection and Social Inclusion,
2008).
Consequences of on-going changes in the future. The world of work has
radically altered in organisation and composition and will continue to change
over the next decades. European Member States will need to deal with these
changes which can have a positive or negative impact on workplace health and
safety. It is clear that public health and workplace health interventions among
workers will be a major future challenge for maintaining a healthy workforce.
