Told you so....(*)
Part-time work surges in Europe
By John Tagliabue The New York Times
THURSDAY, MAY 11, 2006
PARIS European labor markets are encrusted and sclerotic, right? Tell that to Jean-Pierre Lemonnier.
Lemonnier is out front on a seismic shift in the way Europeans work that is provoking the rapid decline of the traditional full-time job. Long taboo to European labor unions and governments, part-time work and temporary jobs are becoming by far the richest source of new jobs across Europe.
"There's a need for flexibility," said Lemonnier, president of Manpower France, a temporary-staffing company. "Firing, on economic grounds, in a company with more than nine people, is extremely complicated. So temporary work is the simplest solution for the companies."
Europe still has about twice the unemployment rate of the United States. Yet, in the past five years, employment growth for both part- and full-time jobs has been faster in the 12 countries that use the euro than in the United States, where the labor market stagnated and even briefly shrank in 2001 and 2002.
In the years 2000 to 2003, employment increased cumulatively by about 3.5 percent in the euro zone, while quarterly employment growth in the United States was on average close to zero and fell cumulatively by almost 1 percent. Since 2004, employment growth has picked up considerably in the United States but has slowed slightly in the euro zone. Some say the European job growth is buoyant partly because strong employment in some countries has offset lags elsewhere.
"If you take the whole of Europe," said Alexander Spermann, a labor market expert at the Center for European Economic Research, in Mannheim, Germany, "it's the old Europe that has a problem: Germany, Italy, France."
Countries like Denmark, the Netherlands and Britain had greater success in job creation, Spermann said.
But a closer look at the numbers suggests that it is in large part the explosion of part-time and temporary work that has lifted job growth. Martin Werding, an employment specialist at the IFO Institute for Economic Research in Munich, said: "There has been expansion, in any case, but not in the kind of jobs that count as full-time, regular jobs. On that side, there's been a regular decline."
Government make-work programs in Germany, introduced during the past two years to subsidize part-time and temporary jobs, largely had failed to dent the jobless statistics, he said.
Manpower, the world's biggest temporary staffing company, operates more than 1,130 agencies in France, which place about two million people a year. Last year, revenue there was €4.5 billion, or $5.8 billion, more than in the United States, where the company is based.
Like its competitors, including Adecco of Switzerland and Randstad of the Netherlands, Manpower is watching its market grow. Lemonnier says that if major economies like those in France and the Netherlands grew by 2 percent this year, the market for temporary workers could grow by 5 percent.
The proportion of part-time workers in the United States has held steady at about 13 percent for more than a decade, according to the Organization for Economic Cooperation and Development, based in Paris. The number of Europe's temporary workers - people who may work a full week but move from company to company - is soaring. In the decade from 1990 to 2000, Manpower tripled its business, Lemonnier said.
In France, Germany and Italy, more than 12 percent of people working have temporary contracts. In Spain, the figure is more than 30 percent, and in the Netherlands it is 15 percent. Indeed, the percentage of Spanish workers in temporary and part-time jobs is so high that the government in Madrid proposed this week a bill to cut the number of employees on temporary contracts.
That is a large shift from a dozen years ago, not just in numbers but in labor attitudes. For years, Europe prided itself on enforcing rigid job-protection laws, making it difficult for companies to hire and fire workers the way U.S. companies could. Temporary job agencies, like Manpower, were belittled in France, where temporary work was still scorned as "precarious work." In some countries, it was illegal.
Of course, the fast rate of job growth in the last five years is largely a result of dismal rates in the preceding years and pent-up appetite for hiring.
Business leaders say the biggest obstacle to hiring full-time workers is rigid workplace rules, which make it almost impossible to lay off permanent workers when business declines. In France, a company seeking to lay off workers because of a slump in its business has to make a case that would stand up in court that the decline made the jobs unnecessary. Even then, the companies must pay the laid-off workers large packages of benefits. In many cases, companies opt to give workers early retirement rather than lay them off. The recent student strikes in Paris were to protest a government effort to introduce flexibility for first-time jobs.
Outside of France, other European countries have increased their use of part-time workers. The Netherlands has drawn widespread attention in recent years as a model for promoting workplace flexibility, including the expansion of part-time employment.
The Dutch government and the unions encouraged part-time labor, with benefits comparable to those of full- timers, and the proportion has jumped to almost 36 percent from 28 percent a decade earlier. The large majority of those part-time workers are women.
The Netherlands now boasts one of Europe's lowest unemployment rates, at about 4.5 percent. Part-time workers also make up more than one-fifth the total work force in Germany, Britain, Ireland, Spain and Norway.
Business leaders and economists say that part-time work is not the ultimate solution to Europe's unemployment problems. Despite the surge in temporary and part-time employment, the unemployment rate in France among people under 25 years of age remains a stubborn 23 percent.
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