Everyone into Work

Abstract

Despite successive Dutch governments emphasizing “jobs, jobs, jobs”, thousands of people who want to work have no jobs at all, never mind good jobs. Are new technologies, flexible contracts and the intensification of work helping or hindering vulnerable groups to stay in work - in good work in particular? This chaper seeks to answer these questions while analysing what is already being done to provide good work for all. Is the changing labour market opening new opportunities? We address the automation, flexibilization and intensification of work and discuss the need for active labour market policies.

Despite successive Dutch governments emphasizing “jobs, jobs, jobs”, thousands of people who want to work have no jobs at all, never mind good jobs. More than 1.6 million people in the Netherlands live entirely on benefits. In 2017, some 810,000 were claiming benefits for disability and another 378,000 for unemployment, while 442,000 were receiving a basic subsistence benefit. One million individuals in 2018 possessed “unused labour potential”, including approximately 600,000 unemployed who would like to work and 400,000 underemployed eager to work more. These numbers will only increase with the Covid-19 crisis.

Are the automation, flexibilization and intensification of work leading to more or fewer people finding and retaining jobs? Who is benefiting or suffering the most from these developments? According to the oecd,¹ the Achilles’ heel of the Dutch labour market is its lack of inclusiveness; although the vast majority of the population is working, specific groups are marginalized in the labour market. Are new technologies, flexible contracts and the intensification of work helping or hindering vulnerable groups to stay in work – in good work in particular? Is the changing labour market opening new opportunities? What are the prospects for the future? Are new vulnerable groups emerging?

This chapter seeks to answer these questions while analysing what is already being done to provide good work for all. We address, in turn, the automation (Sect. 6.1), flexibilization (Sect. 6.2) and intensification of work (Sect. 6.3) before discussing the need for active labour-market policies (Sect. 6.4) and presenting our conclusions (Sect. 6.5).

1 Technological Developments

The end of paid work and the working class has been a recurring prophecy in modern western history.² But despite the introduction of the factory assembly line in the nineteenth century, the personal computer and the global internet in the twentieth century, and mobile phones, robots and artificial intelligence in our own era, both dreams and nightmares about the coming end of human labour have come to naught.

Although a much-discussed 2013 study by Frey and Osborne³ provoked fears that robots would eliminate 47% of jobs in the United States over the next two decades, little remains of the doom and gloom just a few years later. Some studies even warn that there will be too few people for all the new jobs created by AI, robots and cobots.⁴ But these latter studies, too, remain speculation; many are based on the subjective expectations of ceos and technical experts, which we need to take with a grain of salt.

Box 6.1 Robots Sacked

We have all heard predictions of the impending robot apocalypse which could cost up to half of all workers their jobs in the near future.⁵ But the revolution is not proceeding as quickly as some expected. A hotel in Japan put hundreds of robots to work in 2015; half of them, due to malfunctions, were “sacked” in 2019.⁶

Treatises on machines replacing people have recently become more nuanced and realistic. Approaching jobs as bundles of tasks, they focus on which sub-tasks are amenable to automation. This does not mean that the machines are taking over as all kinds of other considerations, power relationships and preferences remain.⁷ Human beings do not only work to make money but to structure their days, gain self-esteem, enhance their identities and feel a part of society.⁸

Although technology can take over specific tasks, this is less the case for entire jobs; no profession can be reduced to a set of tasks that can be done by machines alone. Much depends on the specific applications of the technology and the choices made about their implementation.

Few people perform only a single task at work.⁹ Although it may be possible to automate certain subtasks, whether this actually happens depends not only on the (often overestimated) capabilities of the new technology but on the structure of specific firms and sectors, and on the economic, social and political stakes involved. Studies by the Dutch government’s three largest employment-related executive agencies for the National Labour Market Analysis 2018–2025¹⁰ show that the time freed by partial task automation can be used to increase production, ease workloads, improve production quality, undertake other activities or use fewer people to produce the same amount – or some combination of the above.

As many firms have discovered, not all work can be done by computers and robots. Hal Varian, chief economist at Google, notes that many jobs are more complicated and much harder to automate than is often believed.¹¹ Although many driving jobs may seem obvious candidates for automation, anyone who regularly rides a bus or talks to a trucker knows better.¹² It is also doubtful whether we want to rid ourselves of the humans in our midst; bus drivers, tram conductors and train guards also attend to passenger safety.

Governments, employers and trade unions all have influence over how new technologies are implemented in the workplace.¹³ While millions of workers have indeed seen their tasks change under the influence of new technology – a trend that will continue into the future – we need to focus on human-machine complementarity within specific applications of technology and on restructuring the labour market, both to increase productivity and to improve the quality of work.

Box 6.2 Robots in Cleaning?

The 2017 collective agreement for the Dutch cleaning sector included provisions for a pilot project in which employers and trade unions study the possibilities of developing robot technology which is good for both cleaners and companies. Although we do not yet know what will come of it, this initiative – based on the principles of complementarity, co-creation and co-ownership – suggests a way forward for other sectors wishing to take full advantage of the possibilities offered by robots, cobots and artificial intelligence.

1.1 Job Polarization

Which jobs are particularly vulnerable to automation? Although unemployment is highest among people who only have high-school diplomas, their prospects have not declined. Fig. 6.1 shows that unemployment among this group declined from 7.3% in 2003 to 6.6% in 2018.¹⁴

Fig. 6.1

Unemployment rate by level of education, 2003–2018

Source: cbs StatLine. (https://opendata.cbs.nl/statline/#/cbs/nl/dataset/82922NED/table?fromstatweb)

Scholars have predicted that automation will lead to “job polarization” – the disappearance of jobs such as routine administration in the middle segment of the labour market.¹⁵ The phenomenon has affected the Netherlands less than many other countries (Fig. 6.2).¹⁶ The proportion of Dutch jobs requiring only low skills – or conversely, high skills – has risen by about 5 percentage points over the past two decades, whereas jobs requiring post-secondary vocational education has declined by around 10 percentage points. According to the Netherlands Bureau for Economic Policy Analysis, this is creating a new divide among workers with post-secondary vocational qualifications¹⁷: some have moved down in the labour market, working jobs below their nominal skill levels, while others have moved up into jobs for which they are not formally qualified. The biggest changes are taking place within sectors and professions. Secretaries who previously used to type and distribute faxes are now involved in planning and project management.

Fig. 6.2

Employment shares by skill content of occupations (percentage points), 1995–2015, oecd countries

Source: oecd (2018a)

It is not a foregone conclusion that technological changes will hollow out the middle class. Many routine white-collar tasks have already been automated, while it is conceivable – and at times already apparent – that tasks traditionally performed by university graduates can be done more effectively by, or together with, smart machines; consider how radiologists, accountants and lawyers are aided by algorithms in their work.¹⁸ What this means for existing professions – and what new jobs may appear in the manufacture and maintenance of new machines or due to entirely new possibilities – is impossible to predict in advance (see also sect. 6.2).

1.2 Switching Between Jobs

Good work allows people to adjust to advances in technology. Everyone needs to be able to learn on the job as emergent technologies may alter or eliminate their current tasks or create new ones. Having the space and support to cope with these changes – “learn while you earn” as The Economist calls it – is crucial for preserving work or, if necessary, for switching careers. The independent think tank DenkWerk estimates that Dutch employers will have to invest €4–7 billion a year in on-the-job retraining and refresher courses if the country is to make the most of the opportunities offered by new technology.¹⁹

Technological change within companies does not take place overnight. Supporting people into new lines of work cannot wait until they are declared redundant; the Employee Insurance Agency and its partners must get involved before lay-offs occur.²⁰ Workers need to be protected during such transitions, not least by the social-security system.²¹

1.3 Technology for Inclusivity

New technologies can aid current workers to learn new tasks, help people with occupational disabilities to find work, and to make the labour market more inclusive.²² Technologies such as virtual reality can help workers learn new tasks in fields such as manufacturing, maintenance and medicine (e.g. wound care), while several organizations in the Netherlands are dedicated to using technology to help people with occupational disabilities find and retain work. Higher wages for low-paid workers in the United States has led some companies to automate their jobs out of existence, while other firms have turned to new technologies to make their workers more productive, thus justifying higher pay.²³

New technologies will change the demand for labour and the nature of work. But how their application will affect the quality of work is neither a foregone conclusion nor a process we can leave to the market alone. As firms, institutions and governments often make decisions that undermine good work, these choices must be monitored. Machines can be deployed to replace people but also to help them work better, collaborate more effectively and to be more productive. New technologies can be used to offer people currently marginalized in the labour market new prospects as well as to give lower skilled workers new tasks and opportunities.

2 Flexible Labour Market

It is often claimed that the flexibilization of the Dutch labour market has created jobs and allowed more people to keep working. It enables employers to remain agile, to lay off staff when necessary and recruit more readily in good times. But it could also be argued that flexible work undermines workers’ incentives to innovate,²⁴ creates costs for companies through staff turnover, and exerts downwards pressure on wages, consumer spending and thus economic growth.²⁵ According to the Netherlands Bureau for Economic Policy Analysis (CPB), the question of whether flexible work creates jobs or simply replaces permanent jobs with more insecure ones cannot be answered with certainty: “From an economic perspective, it cannot be said which type of employment relationship is preferable or what proportion of flexible relationships within the working population is ideal.”²⁶ In other words, this is a decision society has to make. How much do we value everyone having access to good work? As the CPB points out, the flexible labour market differentially affects segments of the workforce. Fully 45% of people with a low level of education had flexible jobs in 2018 (Fig. 6.3).

Fig. 6.3

Working people by type of contract and level of education, 2008 and 2018

Source: Statistics Netherlands

2.1 Permanently Temporary

At first sight, flexible labour markets may seem to favour people with occupational disabilities and outsiders such as migrants. Employers are disinclined to take risks and temporary contracts entail few obligations – certainly in the Netherlands. The oecd²⁷ credits temporary contracts and the flexible labour market for the comparatively high proportion of individuals with severe mental disorders working in the Netherlands. Others argue that employers will be more inclined to give refugees a chance if they can do so without longer term obligations.

Finding work is not the same as keeping it, as more and more people find themselves trapped in the labour market’s ever-expanding “flexible shell”. High-school graduates, ethnic minorities, migrant workers from Eastern Europe and people with chronic medical problems are more likely than others to have temporary jobs, which are now spreading among other segments of the population, most notably the over 25s and people with post-secondary qualifications.²⁸

A temporary contract is now rarely a stepping stone to a permanent position, especially for on-call and casual staff.²⁹ Very few people hired on a temporary basis in the period 2010–2019 had a permanent position 1 year later; despite economic growth, this percentage has been falling since 2010, down to 14% in 2019.³⁰ It is common for temporary contracts to be strung together so that a worker is effectively employed on a “permanently temporary” basis.

2.2 A Revolving Door in Social Security

Labour market flexibility has opened a revolving door in the social-security system as people alternate between temporary work and unemployment. The proportion of flexible workers still working after 2 years is 10% lower than for employees with permanent contracts.³¹ As shown in Fig. 6.4, temporary workers are far more likely to claim unemployment or subsistence benefits. Due to the high rate of economic inactivity caused by intermittent periods of unemployment, these workers place a heavy burden on the social-security system. Most jobs found by benefit claimants are temporary,³² meaning their reintegration into the labour force is also only temporary.³³ Finding a job rarely means a job one can keep.

Fig. 6.4

Benefit claims by type of contract previously held, 2014

Source: Van der Werff et al. (2016)

While even temporary work is generally better than no work at all, repeated bouts of short-term employment interspersed by applications to the benefits office mean a succession of demotivating disappointments, attacks on one’s self-esteem, stress and financial uncertainty (“If my contract expires this month, will I receive money from the benefits agency next month?”). Research from the uk shows that people who can only find a succession of insecure jobs suffer deteriorating health.³⁴ The flexible labour market questions the very concept of “reintegration”.

2.3 Less Training

Employers invest less in workers with temporary contracts.³⁵ This applies especially to formal training courses, from which temporary personnel are generally excluded. The difference is most marked for workers with post-secondary qualifications or university degrees, while high-school graduates have fewer learning opportunities, formal or informal, across the board.³⁶ Although training is crucial for people to be able to stay in work and to change jobs when necessary, the weaker responsibility relationships between employers and employees in the flexible economy renders it unusual.

Our era demands that everyone – regardless of their form of employment – has access to additional training or retraining to stay in work. Flexible workers should be able to make use of the sectoral training and development funds and the personal learning budgets from which they are now largely excluded. While individual learning accounts can increase participation in training, their use needs to be encouraged among groups that currently make scant use of such opportunities.³⁷ Such individual funds should be part of a contract-neutral social-security system (see sect. 3.1 and Chap. 8).

2.4 Protection

The flexible labour market poses additional problems for people with chronic health problems. The “flexicurity model” of the Netherlands and Denmark, which combines flexibility with good social-security provision, offers them few job opportunities.³⁸ Since the mid-1980s, the gap between less skilled workers with and without health problems has grown enormously in both the Netherlands and Denmark; Sweden has performed better, especially when protections against dismissal were more robust. A European comparative study likewise concludes that stronger contract protection leads to more people with occupational disabilities working.³⁹ Permanent contracts protect vulnerable workers more effectively as employers are legally obliged to take responsibility for them. The flexibilization of employment relationships thus contributes to the long-term marginalization of the “least productive” workers.

Both employers and employees would benefit from permanent staff having greater opportunities to switch tasks and positions, either in their current company or elsewhere in a pool of collaborating firms. This “internal flexibility” can to some extent replace “external flexibility”. Both the trade-union movement and one of the main Dutch employers’ organizations, the awvn, advocate making greater use of such arrangements.

2.5 Opportunities Through the Hybridization of Work

Other forms of flexible labour such as self-employment or working through online platforms can offer vulnerable people an alternative into the world of work. “Hybridization” – the concurrent pursuit of different activities under different types of contract – can also increase opportunities in the labour market. More than half a million multi-jobbers in the Netherlands already combine two or more (generally part-time) positions; some of them would be unable to make ends meet otherwise. Some multi-jobbers choose hybridization as a way to transition into other work, either because they want to or they must.⁴⁰

For some groups, self-employment may be the answer. People with physical or mental disabilities may find it easier to work from home and to adapt their daily schedule to their own needs, gaining the control in life which comes from being their own boss. Ethnic and religious minorities sometimes choose – or are more or less forced into – self-employment because no-one will hire them or because they would rather work for themselves than in an unwelcoming organizational environment where they face discriminatory or aggressive behaviour from colleagues and managers.⁴¹ Such discrimination often takes subtle forms such as “jokes” about terrorism, religion or crime, alienating them from the workplace.⁴² To gain greater control over their work, some choose entrepreneurship.

Nevertheless, self-employment is no panacea for an inclusive labour market. Problems arise when people claiming benefits try to make money with freelance activities on the side; it is also much more complicated to be self-employed than on a payroll. The chances of success are often limited. Those working for online platforms or in the arts struggle more than most to pick up assignments. Combined with structurally low rates of pay, this often exposes them to poverty (see Chap. 3). Turnover is high in individual self-employment; while many register with the Chamber of Commerce as freelance workers each year, the number of deregistrations is considerable.⁴³ Those who move successfully from benefits into self-employment are indeed a select group; they tend to be young, with post-secondary or higher education or past freelance experience.⁴⁴

In sum, the flexibilization of the labour market has led to more people in the Netherlands working, but not always in good jobs – especially for people with chronic health conditions, for many first, second and third generation immigrants, and people with no more than secondary education. This is not only detrimental to them; it also strains the social-security system (see sect. 3.1). Flexible workers have fewer opportunities for professional development and training and are less protected. To counter these adverse effects, employers and the government should invest more in these workers and in the more flexible apportioning of tasks within firms and organizations. Although juggling several part-time positions may allow workers to spread the risks and possibly provide stepping stones to other work, this is often wishful thinking for the most vulnerable groups.

3 Intensification of Work

Is the intensification of work creating new labour market vulnerabilities? Both the faster tempo and greater mental and emotional demands on the job can make work more challenging and interesting. But they are also linked to increased stress, emotional exhaustion and burnout.⁴⁵ The intensification of work can effectively push people out of the workforce and make it harder for specific groups to remain in or return to work.⁴⁶

3.1 New Vulnerabilities

Workers who must deal with constant emotional pressure – for example because they interface with clients, customers and patients – are at higher than average risk of burnout. The same applies to those with heavy workloads or who work under severe time pressure (see Fig. 4.2). While many people can handle short periods of intensive work, long-term exposure to stress is unhealthy in many ways.⁴⁷

The number of Dutch workers suffering symptoms of burnout is on the rise. Between 2007 and 2018, the proportion saying they are emotionally exhausted at least once a month rose from 11.3 to 17.5%.⁴⁸ Highly educated individuals, women and young people aged 25–35 suffer the most; the self-employed fare better. Experiencing some of its symptoms does not necessarily mean that a worker is suffering from full-blown burnout. Nevertheless, more and more reports to the Netherlands Centre for Occupational Diseases mention excessive strain and burnout, which now outnumber reports of work-related physical illnesses.⁴⁹ The intensification of work is accompanied by new forms of absenteeism. Almost half (46%) of all sick leave in the Netherlands is now due to conditions at work, the highest since 2007. The majority of affected workers (60%) attribute their problems to psychosocial workload – excessive stress or emotional pressure, problems with managers, customers and so on.⁵⁰ Workers are also suffering from higher levels of mental illness. It is precisely such problems that cause longer-term withdrawal from the labour market; over half of disability benefit claimants receive them for psychological conditions.⁵¹

Intensive working need not lead to emotional exhaustion and absenteeism (see also Chap. 2).⁵² Sufficient autonomy and consultation in the workplace, alongside support from managers and colleagues, can ease the burden. If homecare workers, for example, were allowed to schedule their own shifts and to work to their own standards, they would be better able to cope with the tempo, workload and demanding clients. Whether the intensification of work leads to new vulnerabilities thus depends on whether the work is good. Especially young people and women experience less autonomy at work than their older and male counterparts; their work is also on average faster-paced and more emotionally demanding. These trends explain why young people and women are more likely to fall victim to burnout.⁵³

Workers’ domestic circumstances are crucial. Children with problems, financial worries or the lack of a supportive partner means there is no respite. Single people are more likely to report symptoms of burnout⁵⁴ as many are unable to unwind and recover at home.⁵⁵ Workers can also better cope with more exacting demands if they can keep their professional and personal lives separate.⁵⁶ The Social and Economic Council of the Netherlands⁵⁷ finds that intensive domestic care duties, especially looking after young children, makes it more difficult for employees to cope with demands at work.

The intensification of work is placing more people at risk, including groups who were previously not particularly vulnerable such as single and highly educated persons. While unceasing pressure or emotional strain is hard on anyone, it helps to have a degree of autonomy at work and support at home. Good work makes the intensification of work more manageable.

3.2 Exacerbating Existing Vulnerabilities

A demanding labour market makes it more difficult for workers limited by health conditions or occupational disabilities – any form of physical, visual, mental or psychological condition that affects the individual’s ability to work. This definition extends well beyond the traditional notion of a disability as a visible impairment to include for instance people struggling with depression or the aftermath of cancer. Everyone – young or old and whatever their level of education – can experience an occupational disability at some point in their life.

The Netherlands lags behind many European countries in keeping people with occupational disabilities in work.⁵⁸ Despite the policy focus, their workforce participation has declined (Fig. 6.4). Many lost their jobs or found it difficult to work in the wake of the 2008 financial crisis; only after the 2013 Jobs Accord between employers’ organizations, trade unions and the government did the number of employed persons with disabilities tick slightly upwards. Under this social contract, 125,000 jobs will be created for people with occupational disabilities by 2026, including 25,000 jobs in the public sector. Before the Covid-19 crisis, their workforce participation had not returned to pre-crisis levels; the disparities between this group and the rest of the population remain substantial.

People with physical disabilities have slightly better access to the labour market than people with mental disabilities⁵⁹ – the category of people most excluded from the labour market. Only one in five persons with a severe mental condition are currently working,⁶⁰ while the intensification of work poses particular challenges for people already struggling psychologically. For people with chronic illnesses or occupational disabilities, intensive activity or complicated, emotionally demanding work with a lot of human contact can generate unbearable stress (Fig. 6.5).

Fig. 6.5

Labour-market participation of people with and without disabilities, 2003–2017

Source: Statistics Netherlands (With thanks to Paul de Beer)

The intensification of work poses particular difficulties for people with mild intellectual disabilities. An estimated 1.4 million persons in the Netherlands – many of whom receive benefits⁶¹ – have an iq between 50 and 85 and experience problems with self-reliance. While low-skilled work certainly exists in the Netherlands (see Table 6.1), much of this work is now out of reach as requirements have changed: the pace has quickened while workers need to be able to work independently or in tight-knit teams, whereas persons with a mild intellectual disability typically benefit from a calmer tempo, less complexity, plenty of security and continuous guidance.⁶² The intensification of work is increasingly distancing even basic work from the needs and capabilities of this group.

Table 6.1 Work requirements and the needs of people with an intellectual disability

There is thus a widening gulf between the labour market and workers with mental, psychological or medical disabilities (see Table 6.1). Many researchers have concluded that this gulf can only be narrowed if jobs are more individually tailored. Many vulnerable people simply do not fit available vacancies. It would be better to focus less on the requirements of the work organization and look more at the skills, working speed and qualities of the aspiring worker.⁶³

3.3 Reintegration Is More Difficult

The intensification of work can make reintegration into the labour force more difficult for people who have taken time off. Because people are now working into old age and illnesses such as cancer are often recurrent, their reintegration in the workplace has become a pressing issue. While staying in work or returning to the same job works well in many cases, reintegration rarely unfolds smoothly and is often accompanied by complaints such as fatigue and concentration problems.⁶⁴ If the pace of the job has accelerated or old know-how has become obsolete, this only raises the barriers to a successful return.

Box 6.3 Working with an Occupational Disability

Ms. O, with rheumatism, osteoarthritis and deafness in her right ear, says that she is happy working at retailer X. “The nice thing is that there is no time pressure. The work I do is facing, making sure that the shop looks good by placing the different products in the right place. From time to time I can take the moments of rest I need, and I set my own working pace. That’s important to me because it’s what enables me to keep going.”⁶⁵

Many people who have been away from work for a long time have or develop complex problems. Half of all subsistence benefit claimants report that they are “sick”⁶⁶ – a catch-all term for a variety of ailments and issues. An estimated 40% of people on unemployment or subsistence benefits must deal with a multiplicity of problems in their lives.⁶⁷ Joblessness is rarely the sole problem; it goes hand in hand with debt, health complaints, family issues, language deficiencies and lack of social support. These problems also hinder their search for work, especially now that it has intensified.

Employers are reluctant to recruit people who are distanced from the labour market. Long-term unemployment in the Netherlands is higher than in many other countries; once workers have been side-lined, especially older and less skilled people tend to remain out of work for long periods.⁶⁸ For many employers, long-term unemployment is in itself a red flag for a person best avoided.⁶⁹ Having an occupational disability is an invitation to have doors slammed in one’s face. Only one in five employers claim they are willing to hire people with a (preferably physical) disability; an even smaller proportion actually do.⁷⁰ Although support from colleagues and managers is crucial during reintegration, productivity targets get in the way. Not everyone has the time to explain yet again how the computer system works, or to jump in when a returning colleague is unable to complete a task.

3.4 Limits to the Intensification of Work

There is a human limit to the intensification of work: “Just as an extension of the length of the working day is bounded by the number of hours in the day, so human physical and mental capacities do not allow an endless expansion to effort.”⁷¹ The question is whether the Netherlands has reached this limit. Absenteeism due to psychosocial complaints is increasing; people who were not previously vulnerable are falling ill – highly educated young women, for instance, who are reporting symptoms of burnout in ever-higher numbers. The intensification of work has placed many people who were already vulnerable at an even greater distance from the world of work. Clearly, people are better able to cope with intensive work if they have some autonomy in the workplace and control in their private lives. Again, the quality of work is crucial.

Box 6.4 Starting Points for a Preventive Labour-Market Policy

Figure 6.6 summarizes how we can keep the automation, flexibilization and intensification of work from exacerbating existing vulnerabilities and creating new ones. There are a number of starting points to achieve positive change.

Fig. 6.6

How labour-market developments can reduce vulnerabilities

The use of new technologies in the workplace can benefit working people, even vulnerable ones, if it focuses on complementarity: encouraging co-operation between humans and machines, both in the development of applications and in their implementation.

Flexible labour markets require responsible employers who actively invest in their employees. So long as “permanently temporary” employment does not become the norm, temporary contracts need not be a problem. But the employer must invest in its temporary staff, including those with disabilities.

To mitigate the negative effects of the intensification of work, greater worker autonomy is essential. When people have a real say over what they do and when and where they do it, they are better able to be highly productive and to deal with emotionally challenging situations. Being able to co-ordinate the professional and the personal helps.

All of these aspects of good work offer greater protections against joblessness and are crucial ingredients within actively preventative labour-market policy.

4 Policies to Help People into Work

“Work, work, work” has been a key policy objective in the Netherlands for decades. But is enough being done to ensure that everyone can find and keep a good job? To combat many thousands of people dropping out of the workforce, prevention is more effective than any cure. This section asks whether the Netherlands’ labour-market policies are sufficiently active to help people find and retain work in the age of its automation, flexibilization and intensification.

4.1 Limited Investments

Recent attention has focused on containing costs in the Dutch social-security system and on imposing obligations on its beneficiaries.⁷² In contrast, little has been invested in people who have left the labour market. At the beginning of this century, the Netherlands was second only to Denmark in its investments in active labour-market policy (Fig. 6.7). In the past decade, spending in this area has nearly halved, dropping to 0.6% of gdp in 2017.⁷³ This is the same as in Germany, less than in France and Belgium (0.9%), and much less than in Sweden (1.3%) and Denmark (2.0%). While Denmark maintained and Sweden increased support for the unemployed during the 2008 economic crisis, the Netherlands cut back – although research shows that active policies have the greatest effect and are most needed during crises.⁷⁴

oecd statistics provide an overview of the various components of active labour-market policy. Compared to other European countries, investments in vocational education and training are particularly low in the Netherlands, amounting to just 0.07% of gdp in 2017 – far less than in Denmark (0.46%) or France (0.28%).⁷⁵ This limited attention to training is striking, especially in light of the technological developments affecting the workplace and the intensification of work – the more so when we see that the majority of people claiming subsistence benefits in the Netherlands lack even a basic educational qualification. The Netherlands also commits less resources to job search assistance than the Scandinavian countries, France and the United Kingdom. Many unemployed persons thus fall through the cracks.⁷⁶ A significant proportion of those without work rarely see a case manager or anyone from the Employee Insurance Agency.⁷⁷ In contrast to the 1990s, virtually nothing is now spent on directly creating work.

Why has the Netherlands not maintained the active labour-market policies it initiated in the 1990s? There are three explanations. First, the focus of government policy, particularly labour-market policy, has shifted away from public provision towards individual self-reliance.⁷⁸ In the 1990s, the emphasis was on enforcing social-security rules and sanctioning non-compliance; now, the unemployed are expected to find the shortest route into work. Unlike the “human-capital” or “train-first” approach, this “work-first” approach best serves people who find it relatively easy to move into work. In other words, the policy primarily targets those who least need it.⁷⁹

A second explanation is administrative decentralization and the Participation Act of 2015, which transferred responsibilities for the labour market reintegration of subsistence benefit recipients to local authorities. At the same time, supporting budgets were cut dramatically.⁸⁰ Local governments had little expertise in guiding people into work and were slow in taking up their new tasks. An evaluation of the Participation Act found that it led, at best, to a slight increase in workforce participation. In some respects it has had no effect or even reduced participation, most notably among people previously in sheltered employment who are now more likely to be at home than in work.⁸¹ For “classic” social-security claimants, the chances of finding a job have risen by just 1 percentage point. Young adults with occupational disabilities are now more likely to be working, but their jobs are often poor, part-time and/or temporary; they can barely make ends meet, let alone build a meaningful life.⁸² The Netherlands Institute for Social Research, which conducted the evaluation, concludes that the objectives of the Participation Act have not been achieved.⁸³

Finally, academic research has contributed to the weakening of active labour-market policy.⁸⁴ Doubts have been raised, especially by economists, about the effectiveness of active labour-market policies, often due to contradictory findings.⁸⁵ This is often due to limitations in the research itself; it is difficult to gauge the effectiveness of interventions as conditions in the real world of work are hard to keep constant. There is often a degree of partiality in participant selection (or self-selection), while the interventions – a training course or a conversation with a case manager – differ.⁸⁶ If we look at the evidence in more detail, some instruments work better than others; it also matters who the intended beneficiaries are. For example, active policies are more effective for those with the fewest opportunities such as the less skilled, the long-term unemployed and people with occupational disabilities.⁸⁷ We also know little about whether interventions help people feel healthier or more valued, even when they do not directly lead to finding a job.

4.2 What We Know

Meta-analyses of research on hundreds of programmes⁸⁸ suggests that imposing obligations on benefit claimants and penalizing them for non-compliance has some effect on people who are not already distanced from the labour market. Education and training have less immediate success, but achieve modest results after 2 or 3 years.⁸⁹ The most effective form of intervention is instruction in specific skills currently in high demand, especially in the private sector⁹⁰ – preferably in the form of learning on the job. Temporary wage subsidies tailored to the individual beneficiary also have some positive effect.⁹¹ Although digitization has penetrated the Dutch job-placement sector,⁹² face-to-face meetings with a professional adviser helps to find a paid job sooner; even one conversation can make a big difference.⁹³

Instruments are best tailored to the type of jobseeker.⁹⁴ While exhortations and penalties may suffice for people who are ready to work, they are pointless for people with very limited employment potential, chronic health problems or some other form of occupational disability. They need a different approach, one that is personal, intensive and long-term.⁹⁵ This is at long last being recognized in the Netherlands, as can be seen in the additional resources channelled to the Employee Insurance Agency following successive cutbacks, and by local authorities again focusing on personal contact with subsistence benefit recipients.⁹⁶ In 2016, the City of Amsterdam introduced a programme for refugees involving specialist case managers who focus on understanding their problems, building personal relationships, civic integration courses and labour-market guidance. The result has been higher workforce participation than in the city’s past and in the rest of the country – although Amsterdam’s thriving pre-pandemic economy has helped as well.⁹⁷

The intensive approach means more personal contact with qualified professionals and a process attuned to the jobseeker’s potential rather than to the brute fact that he or she is claiming benefits. Good work means work tailored to the individual in such a way that they gain greater control in life. People with limited work prospects often face a web of problems, at home and/or with their health; case managers need to look beyond the boundaries of labour-market guidance and work with, for instance, debt-counsellors and healthcare professionals. Although it has long been known that the unemployed are more likely to be ill and vice-versa, “care cannot be used for reintegration and reintegration cannot be used for care”.⁹⁸ Academic studies furnish evidence to develop more personalized interventions.

4.3 What About Employers?

Most employers are reluctant to hire if applicants do not fit the profiles for available vacancies.⁹⁹ They are afraid to incur additional costs due to job and workplace adaptations, greater needs for supervision, sickness and absenteeism.¹⁰⁰ Research shows that potential health issues play a larger role in hiring and retention than age.¹⁰¹

Predictable, stable finances are a prerequisite for employers. Targeted wage subsidies are more effective for enrolling vulnerable workers than general wage subsidies, which also benefit people who would have found work anyway.¹⁰² The Netherlands, like most European countries, makes scant use of these instruments.¹⁰³ Other schemes to help people into work include wage dispensation and the appointment of a jobs coach. Different financial and legal regulations apply to each category of benefit recipient; many employers claim they are unaware of the regulations.¹⁰⁴

The job-placement landscape in the Netherlands is fragmented and opaque. Figure 6.8 shows just how complicated the current system is. The roles played by the local authorities and the Employee Insurance Agency, employers’ organizations and trade unions differ across situations. Many jobseekers and employers have no idea where to turn.

Fig. 6.7

Spending on active labour-market policy as a percentage of gdp, 2004–2017, in the Netherlands and other European countries

Source: oecd database. (https://stats.oecd.org/index.aspx?DataSetCode=lmpexp#)

Fig. 6.8

Organization of job-placement services

Source: Employee Insurance Agency (uwv)

Financial incentives do not suffice to persuade employers to hire as organizations must often change to accommodate different types of workers. Those that have made “diversity” part of their mission recruit more people from vulnerable groups; so do large firms (with over 100 employees), firms that already employ less skilled staff and the government.¹⁰⁵ Things are often more challenging for small and medium-sized firms. Active public labour-market policies must back employers’ own hr. policies¹⁰⁶ to guide and support individual jobseekers while making the necessary adjustments within the organization to create space for them. Tailoring jobs for vulnerable workers often requires the involvement of the entire organization.¹⁰⁷ Effective activation requires long-term commitment from both sides.¹⁰⁸ The challenge is to innovate in such a way that more vulnerable workers are able to join the workforce.¹⁰⁹

Box 6.5 Individual Placement and Support

An approach known as Individual Placement and Support is often used for people with severe mental impairments. Together with the jobseeker, a jobs coach determines what kind of work and tasks the person can handle. A suitable position is then created in a regular work organization, a process known as “jobcrafting”. The new employee receives work, care and guidance for an extended period – sometimes even permanently. Shown to be effective, the approach is now being tried more widely among subsistence benefit recipients. The key is close attention to “the whole person” as well as to the work environment, where they are likely to need intensive internal supervision. Not only workers need coaches; so do their employers, managers and colleagues.

4.4 Good Basic Jobs

While active labour-market policies need to target both potential employers and employees, it does not suffice for people without realistic prospects of finding paid work. This is why “basic jobs” are back on the agenda, now championed by many sociologists, lawyers, economists and several Dutch political parties.¹¹⁰ The same discussion is taking place in other European countries. Basic jobs are a response to the changing face of work, to the “demanding and uncertain labour market” which offers insufficient opportunities for one million people in the country.¹¹¹ “The reintegration into work of the unemployed no longer offers any guarantee of a sustainable, fully-fledged job.”¹¹² To some extent, basic jobs are also an answer to the campaign for ​​a basic income. If work is so important to people mentally and socially, society should, instead of providing them with income, offer good work.¹¹³

Dutch cities such as Amsterdam and The Hague have been experimenting with basic jobs for people on subsistence benefits for some time.¹¹⁴ Sweden has its own variants such as the 1000 “Stockholm Jobbs” its capital city is hoping to create. Similarly, “one-euro jobs” in Germany entail work in the social sector with the retention of benefits plus a bonus of 1 euro per hour.¹¹⁵ The idea is that there is a lot of socially useful work to be done and that the financing of benefits may as well be converted into wage subsidization to create paid work.¹¹⁶ Although these schemes incur organizational and supervision costs as well as additional social insurance contributions, the local authorities believe that general well-being is enhanced, that healthcare spending will fall and that community cohesion will benefit when everyone is able to be part of the workforce (see also Chap. 2).

The Netherlands has previous experience with subsidized jobs. The best known are the 40,000 “Melkert jobs” created in 1994 by the then Minister of Social Affairs and Employment, Ad Melkert. To avoid competing with regular work, these positions – paid 120% of the statutory minimum wage – had to be complementary; the idea was that the “Melketeers” would eventually move into “real” work. Half of these jobs were with private firms; the other half were in the public sector, where city wardens and school caretakers were supposed to improve the quality of society.¹¹⁷ The Melkert scheme was replaced in 1999 with “id jobs” (from the Dutch abbreviation for “entry-level and step-up”). The central government abolished these positions with the decentralization of subsistence support in 2003. Many local authorities were unwilling or unable to make the investments necessary to maintain them and all subsidised labour eventually disappeared. Secretary of State Jette Kleinsma saw this as a positive development “because the ultimate goal of reintegration is to obtain regular, non-subsidized work”.¹¹⁸

The basic jobs being proposed now are not meant as a path to regular work, although this may at times happen.¹¹⁹ They are primarily for individuals lacking realistic prospects in the mainstream labour market who would otherwise remain dependent on benefits for extended periods. According to the alderman of The Hague who first tabled the idea, the main purpose of basic jobs is to prevent “people entering a downward spiral, at high cost to them individually but also to society.”¹²⁰ The jobs should provide good work – and so not be temporary – thereby shielding their holders from the vagaries of the labour market and giving them some modicum of control over their work and in their lives.

In sum, the Netherlands is suffering from a qualitative mismatch between employers and jobseekers. People who have been out of work for a long time simply do not fit the available vacancies. Overcoming this predicament requires change, commitment and support from all sides. But even as the automation, flexibilization and intensification of work make this urgent, there is scant public investment in active labour-market policy. Renewed policies in this area should focus on good work for all, with tailored strategies for different groups of jobseekers and good basic jobs as the final piece of the puzzle.

5 Conclusion: New Vulnerabilities, New Policy Challenges

Dutch policy jargon includes the frequently heard term “people distanced from the labour market”. But in many cases it is the market that has distanced itself from the people. How will the three developments at the heart of this book – the automation, flexibilization and intensification of work – affect those looking for and trying to stay in paid work?

All three developments have the potential to make all workers more vulnerable, not only those already on the margins. In this respect, the dividing lines between social groups are becoming less clear-cut. Automation, robots and artificial intelligence have already increased insecurity for some white-collar workers. The intensification of work likewise affects society more broadly; although burnout still affects more women and university graduates, it can happen to anyone. Temporary employment, too, is no longer reserved for classic vulnerable groups as the “flexible shell” has penetrated to the core of the labour market.

Vulnerable groups including high-school graduates and people with occupational disabilities may encounter even higher obstacles to labour-market participation. Once a person has been out of work for some time, it is harder to re-enter the workforce; in the jargon, one’s distance from the labour market has increased. Here, the automation, flexibilization and intensification of work are largely exacerbating the divide between highly educated, healthy and productive workers and less productive, less confident people. For specific vulnerable groups, the gulf between the demands of the labour market and their own needs is widening; the long-term unemployed find it almost impossible to keep up with the changing world of work. As a hectic working environment is no place to attempt a gentle re-entry into active life, this puts the whole notion of reintegration to the test.

Prevention is better than cure, but the question is whether Dutch labour-market policy is preventive enough.¹²¹ Keeping everyone in work is an important aspect of the quality of work; focusing on good work is the best preventive labour-market policy of all.

Technology can serve vulnerable groups and help their members to find and retain work. Economist Tony Atkinson¹²² in Inequality, What Can Be Done? argues that the “direction of technological change should be an explicit concern of policy makers, encouraging innovation in a form that increases the employability of workers”. This does not happen automatically; focusing on complementarity – on people working with machines – is crucial. For their own protection, workers need to be involved in transitions and to be able to prepare for them.

Elements of the flexible labour market such as self-employment can offer some people opportunities to find and stay in work. Temporary contracts can in theory offer flexible workers stepping stones towards greater security – although in practice revolving-door unemployment is more common. Flexible working offers scant protection for people with health issues or occupational disabilities. Investing in greater “internal flexibility” – the ability to move into different work within the same firm or within a pool of firms – may be a reasonable response to eroded corporate responsibility.

The intensification of work is more manageable when people have sufficient autonomy and support at work. The high rate of work-related absenteeism and burnout would be mitigated to some extent if people enjoyed more control over their work and a healthy work-life balance.

Although new technologies and the flexibilization and intensification of work open new possibilities for active labour-market policy, the Netherlands in recent decades has halved its budget in this area. As a result, the country now lags behind the rest of Europe. To reverse the tide, active labour-market policies should focus not only on personal training but on the entire work organization. Basic jobs can be a solution for people who are still unable to find work.

The three key developments we analyse in this book do not have predestined effects on working people; there is no question of technological or economic determinism in their outcomes. The automation, flexibilization and intensification of work can be influenced, adjusted, stimulated, inhibited and offset. The next chapter looks at how much scope the government, companies and institutions have to invest in better work: good quality work for people who are already working and for the unemployed who want to work.

A Day at Work: The Chartered Accountant

David is a chartered accountant at one of the major accounting firms in the Netherlands. Its office block is tall with lots of glass; the entrance is elegant and access is limited. One needs a pass to open the building’s many gates.

David shares a room on the sixth floor with a colleague. He starts his day with coffee as he browses his e-mails. An accountant’s core task, he explains, is to provide certainty about the client’s financial situation. Companies and organizations are legally obliged to have their annual financial statements and other regular reports audited by accountants as a true representation of their situation so that other parties – investors, suppliers, the tax authorities and so on – trust them. “Accountants have a social function,” David says, “because without trust every transaction would fall through.”

David is a partner in the firm and thus a co-owner. Partners receive a share of the profits instead of a salary. They are personally responsible for the quality of their own work and that of the junior accountants under them. If something goes wrong, they can face disciplinary proceedings with legal force.

David’s first task today is to consult a colleague for advice about a client with overseas subsidiaries in a complex ownership structure. They outline the situation on a whiteboard, discuss the options and decide which is most realistic. He then dashes to his next appointment. Five minutes late, David storms into a meeting room where 12 people are sitting around a large table with a speaker for teleconferences in the middle and a screen on the wall. They are all partners – predominantly male, white and between 40 and 50 years old – each sitting behind a laptop and a stack of papers. The atmosphere is relaxed, the tempo punishing, the language impenetrable with acronyms and English jargon. Someone explains the items on the agenda; much of the meeting concerns quality improvement. One topic is how to respond to the firm’s forthcoming inspection report by the Financial Markets Authority. The session goes on for 3 h with a short toilet and telephone break half-way through. Lunch is set out and eaten while talking.

At 1:30 pm the meeting is still not over but David has to leave. In his own room, he has a Skype chat with a client about a quote for an annual audit. When the client tries to negotiate a lower rate, David is willing to think about it, although it has already been adjusted once. After half an hour he has to break off and go to another appointment in yet another meeting room. He discusses a quality problem with four partners. One of the firm’s main competitors is ahead on this point, they note jealously. They at least need to reach the same level.

At 3 pm, David is back at his desk. Only now does he find out that his scheduled call has been postponed. He uses the spare time to check his e-mails again – 15 new messages since this morning, which is not so bad – to listen to his voicemail and to fill in his timesheet. He quickly scans the latest financial news on his phone.

At 3:30 pm he calls a fellow partner who will be leaving the firm shortly about the handover of his clients and projects. This is followed by another scheduled call, this time with someone from his own team. David finds the solution being proposed acceptable but warns his colleague not to take on too much work.

At about 5 pm, David sinks back into his chair. It has been a hectic day but not a stressful one. There are also days when he must check reports compiled by his junior accountants, which means spending hours on end behind his computer. The dynamism is why he likes his work – alongside accountancy’s social function, which makes it a difficult profession. After a number of recent scandals, supervision by the Financial Markets Authority has become stricter; the bar for audits has been raised. This has increased costs for clients and the competition between accountancy firms is fierce. “We try to compensate by working smarter”, says David. Ultimately, the pressure falls on the auditing accountants who must deliver high quality in as few billable hours as possible. While software to review standard financial data is advancing, everything else needs to be done by people, including the communication with clients.

At 5:15 pm, a colleague offers David a lift home. Once there, he will spend another half an hour answering e-mails.

Accountant, like notary and lawyer, is a regulated profession in the Netherlands. Practitioners must be registered with the Royal Netherlands Institute of Chartered Accountants. There are currently more than 21,000 active accountants, 80 per cent of them men. Most hold university degrees (chartered accountants), a smaller number higher vocational qualifications (certified accountants), in both cases followed by practical training. The remuneration varies according to their qualifications, workplace and experience, in the range of €3000–9000 gross per month. As co-owners of their firms and thus entrepreneurs, partners are in a separate category and sometimes earn many hundreds of thousands of euros a year. The average (modal) income in the Netherlands in 2020 will be just over €2800 per month, excluding holiday pay. Accountants are in great demand and there are high rates of turnover in the large firms. Recent research by Nyenrode Business University points to heavy workloads in the profession, especially for young accountants, both in terms of hours (an average of eight hours of overtime a week) and quality requirements. New technologies including automated data analysis are expected to change the profession, rendering some human tasks unnecessary.