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The Impact of the Crisis on Employment and the Role of Labour Market Institutions

Author

Listed:
  • Eichhorst, Werner

    () (IZA)

  • Escudero, Veronica

    () (ILO International Labour Organization)

  • Marx, Paul

    () (University of Duisburg-Essen)

  • Tobin, Steven

    () (International Institute for Labour Studies (ILO))

Abstract

The paper takes a comparative perspective on the labour market impact on G20 and EU countries of the financial and economic crisis that began in 2008. It starts from the observation that the decline in employment and rise in unemployment in relation to output or GDP reductions varies significantly across countries. It examines the impacts from an institutional perspective taking into account different channels of external, internal and wage flexibility determined by both the institutional arrangements in place before the crisis and discretionary reforms implemented during the crisis. Emphasis is placed on the role of permanent and temporary jobs, working time adjustment, wage flexibility and active and passive labour market policies. The paper shows that, at least for the time being, unemployment increases have been contained in countries with comparatively strong internal flexibility. At the same time, however, it appears that the crisis has – at least in some cases – contributed to a further dualization of labour markets given that risks are allocated unequally across types of employment.

Suggested Citation

  • Eichhorst, Werner & Escudero, Veronica & Marx, Paul & Tobin, Steven, 2010. "The Impact of the Crisis on Employment and the Role of Labour Market Institutions," IZA Discussion Papers 5320, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp5320
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    Cited by:

    1. Ronald Bachmann & Peggy Bechara & Anica Kramer & Sylvi Rzepka, 2015. "Labour market dynamics and worker heterogeneity during the Great Recession – Evidence from Europe," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-29, December.
    2. Alessio Brown & Johannes Koettl, 2015. "Active labor market programs - employment gain or fiscal drain?," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-36, December.
    3. Gamberoni, Elisa & Von Uexkull, Erik & Weber, Sebastian, 2010. "The Roles of Openness and Labor Market Institutions for Employment Dynamics during Economic Crises," World Bank - Economic Premise, The World Bank, issue 29, pages 1-5, August.
    4. Ronald Bachmann & Peggy Bechara & Anica Kramer & Sylvi Rzepka, 2014. "Labour Market Dynamics and Worker Heterogeneity During the Great Recession – Evidence from Europe," Ruhr Economic Papers 0499, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    5. Lothar Funk, 2010. "Die europäische Flexicurity-Strategie : ein Überblick zu wichtigen Vor- und Nachteilen. The European Flexicurity-Strategy : A Survey on Important Pros and Cons," Duesseldorf Working Papers in Applied Management and Economics 15, Duesseldorf University of Applied Sciences.
    6. Lothar Funk, 2010. "Die europäische Flexicurity-Strategie : ein Überblick zu wichtigen Vor- und Nachteilen. The European Flexicurity-Strategy : A Survey on Important Pros and Cons," Duesseldorf Working Papers in Applied Management and Economics fobe15, Duesseldorf University of Applied Sciences.
    7. Kassinis, George I. & Stavrou, Eleni T., 2013. "Non-standard work arrangements and national context," European Management Journal, Elsevier, vol. 31(5), pages 464-477.
    8. Roxana Gutiérrez-Romero, 2012. "Determinants of Spanish Firms' Life Cycle and Job Creation: A Pseudo-Panel Approach," Working Papers wpdea1209, Department of Applied Economics at Universitat Autonoma of Barcelona.
    9. Herwartz, Helmut & Niebuhr, Annekatrin, 2011. "Regional labor demand and national labor market institutions in the EU15," HWWI Research Papers 112, Hamburg Institute of International Economics (HWWI).
    10. Betcherman, Gordon, 2014. "Labor market regulations : what do we know about their impacts in developing countries ?," Policy Research Working Paper Series 6819, The World Bank.
    11. Marco Percoco, 2016. "Labour Market Institutions: Sensitivity to the Cycle and Impact of the Crisis in European Regions," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 107(3), pages 375-385, July.
    12. repec:eur:ejesjr:121 is not listed on IDEAS
    13. De Vita, Glauco & Livanos, Ilias & Salotti, Simone, 2014. "Involuntary non-standard employment: evidence from Italian regions," MPRA Paper 58117, University Library of Munich, Germany.
    14. Schwander, Hanna, 2015. "Labor market risks in times of welfare state transformation," TranState Working Papers 192, University of Bremen, Collaborative Research Center 597: Transformations of the State.
    15. Zenia Hellgren & Inma Serrano, 2017. "Transnationalism and Financial Crisis: The Hampered Migration Projects of Female Domestic Workers in Spain," Social Sciences, MDPI, Open Access Journal, vol. 6(1), pages 1-18, January.
    16. repec:zbw:rwirep:0499 is not listed on IDEAS
    17. Okechukwu, Cassandra & Bacic, Janine & Cheng, Kai-Wen & Catalano, Ralph, 2012. "Smoking among construction workers: The nonlinear influence of the economy, cigarette prices, and antismoking sentiment," Social Science & Medicine, Elsevier, vol. 75(8), pages 1379-1386.
    18. Luciana Méndez Errico, 2013. "The Impacts of Social Networks on Immigrants’ Employment Prospects: The Spanish Case 1997-2007," Working Papers wpdea1301, Department of Applied Economics at Universitat Autonoma of Barcelona.
    19. Paulina Broniatowska & Aleksandra Majchrowska & Zbigniew ¯ó³kiewski, 2015. "Does minimum wage reduce youth employment on regional labour markets in Poland?," Lodz Economics Working Papers 1/2015, University of Lodz, Faculty of Economics and Sociology.
    20. repec:ilo:ilowps:461897 is not listed on IDEAS

    More about this item

    Keywords

    crisis; employment; EPL; institutions; dual labour markets; flexibility;

    JEL classification:

    • J58 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Public Policy
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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