Tangian A. – Flexicurity and the Crisis. In: Crise, inégalités et pauvretés, ed. by Kerleau M., S. Laguérodie, and J-L. Outin, XXXIth conference of the “Association d'Économie Sociale”, Presses universitaires de Louvain, Louvain-la-Neuve, Belgique, 2011, p. 41-55.
Abstract
Flexicurity is a European labour market policy adopted in 2007 within the European Employment Strategy. The policy aims at enhancing flexibility of employment relations (easing firing and hiring, adjustable working hours, variable pay, etc.), compensating it with improvements in employment security and employment activation. The paper analyses the crisis response to flexicurity. It is shown with statistical certainty that the countries with high labour flexibility are more damaged by the actual crisis. The damage is expressed in terms of output gap (underutilization of full economic potential), public debt, size of bailout packages, and unemployment rate. It is concluded that the flexicurity policy is little compatible with sustainable economy. It implies that the flexicurity requires a profound revision and should not be continued in the actual form. A better alternative to flexicurity would be 'normalization' of employment relations, that is, reducing flexibility, which, among other things, would require less social security expenditure.
