Revisiting Dualism? The Governance of the Low Pay-Low Skill Labour Market in Four European Countries

Werner Eichhorst and Gemma Scalise ()
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Gemma Scalise: University of Milano-Bicocca

No 17378, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The permanent restructuring of the economy, exacerbated by the digital transition and combined with labour market dualization, is progressively increasing semi- and low-skilled workers' risk of marginalization. This article analyses how countries balance employment and equality concerns in core private services sectors and inquires the policy strategy that governments in Germany, France, Italy and Spain have implemented over the last two decades for workers 'at the margins'. The analysis encompasses multiple policy tools – skill upgrading, social benefits, incentives to reduce barriers to employment and wage regulation – and reveals varied trajectories. A common direction is followed by Germany and Spain, which have adopted policies to mitigate long-standing labor market dualism by implementing protective policies that aim at improving job conditions for low-wage and at-risk workers. France is stuck in its protective approach, focusing on job stabilization through subsidies without addressing the need for skill development, which limits long-term labor market mobility. Italy is exacerbating dualism by failing to improve job quality and training opportunities, leading to persistent low productivity and increasing in-work poverty.

Keywords: labour market dualism; welfare; low wage sector; semi- and low-skilled; adult learning (search for similar items in EconPapers)
JEL-codes: J21 J31 J38 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2024-10
New Economics Papers: this item is included in nep-eur and nep-lma
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