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Dr. Minsik Choi (Professor, Ewha Womans University) Public Employment Policy and Job Training Policy for Romania.

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Presentation on theme: "Dr. Minsik Choi (Professor, Ewha Womans University) Public Employment Policy and Job Training Policy for Romania."— Presentation transcript:

1 Dr. Minsik Choi (Professor, Ewha Womans University) Public Employment Policy and Job Training Policy for Romania

2 Issues To Be Discussed 2  Current LMPs in Romania  Evolution of the Korean public employment and job training programs  Korean ALMPs during the 1997 economic crisis  Public employment and job training policies in advanced countries  Linking employment services and job training service to provide convenient services to targeted groups : One stop service  Providing services through private sectors: Enhancing effectiveness of the programs  Some policy implications

3 Active Labor Market Programs: OECD Categories 3 Active measures Public employment services and administration Labor market training Youth measures Subsidized employment Measures for the disabled Passive measures Unemployment pension Early retirement for labor market reasons

4 Participation in Education and Training ▶ Participation in Education and Training in Romania (25-64 years), Working statusRomaniaEuropean Union Employed Unemployed Inactive Total1.68.9

5 Employment and Unemployment Rates ▶ Employment and Unemployment Rates, by highest level of education attained (%, ISCED levels) 5 RomaniaEU Employment rate (20-64 years) Pre-primary, primary and lower secondary education (levels 0-2) Upper secondary and post-secondary non-tertiary education (levels 3 and 4) First and second stage of tertiary education (levels 5 and 6) 82.1 Unemployment rate (25-64 years) Pre-primary, primary and lower secondary education (levels 0-2) Upper secondary and post-secondary non-tertiary education (levels 3 and 4) First and second stage of tertiary education (levels 5 and 6)

6 Persons Registered with Public Employment Services in Romania ▶ Persons Registered with Public Employment Services in Romania (PES) 6 Registered jobseekers (total) Jobseekers aged less than 25 years (18.52%) (20%) (18.58%) (16.77%) (15.93%) (16.02%) (11.43%) (14.25%)

7 Activation-Support in Romania 7 ▶ Activation-Support in Romania (LMP Participants Per 100 Persons Wanting to Work) European Union (27 countries)32,535,133,529,3: Romania6,56,7 3,33,2 Netherlands39,240,648,752,545,4 Austria28,229,431,834,328,0 Poland11,614,728,627,420, European Union (27 countries)40,438,840,248,244,6 Romania16,213,411,424,227,1 Total LMP measures (categories 2-7) LMP supports (categories 8-9)

8 8 LMP Expenditure ▶ LMP Expenditure - Percentage of GDP (Total LMP: Categories 1-9) European Union (27 countries) : Netherlands Austria Poland Romania

9 LMP Expenditure ▶ LMP Expenditure – Percentage of GDP (LMP: Categories 2-7) European Union (27 countries) : Netherlands Austria Poland Romania

10 Expenditure by LMP Interventions 10 ▶ Expenditure by LMP Interventions – Romania (mil. Euro) Labour market services20,6623,6630,6640,8246,2247,7937,0434,77 Training5,044,8210,7011,7612,7512,414,154,24 Employment incentives29,1036,3444,0852,1052,2949,9335,6923,11 Direct job creation23,1120,4331,0133,1829,1720,087,997,37 Start-up incentives0,240,380,390,810,831,050,040,03 Out-of-work income maintena nce and support275,33296,86313,95270,82283,71242,51449,61679,61 Total LMP (categories 1-9)353,49382,49430,79409,48424,97373,76534,52749,13 Total LMP measures (categori es 2-7)57,5061,9786,1897,8495,0483,4647,8734,75 Total LMP supports (categorie s 8-9)275,33296,86313,95270,82283,71242,51449,61679,61

11 Active Labor Market Programs 11 ▶ Active Labor Market Programs: OECD Categories Active measures Public employment services and administration Labor market training Youth measures Subsidized employment Measures for the disabled Passive measures Unemployment pension Early retirement for labor market reasons

12 Evolution of Korean Employment and Job Training Programs 12  Introduction of the employment insurance system in 1995  To prevent unemployment, to promote employment, to develop and improve the vocational ability of workers  Started as active measures  Setting up institutional frame for employment policy by utilizing unemployment insurance funds  Significant amendment in 1997 and 1998 (financial crisis period)  Generous eligibility requirements for unemployment benefits  Grants to promote employment of the long-term unemployed added  Establishment of Employment Stabilization Program expansion

13 Evolution of Korean Employment and Job Training Programs 13  Introduction of One-stop service centers in 2005  Unemployment benefit services  Employment information services  Job skill development services  Partnerships among employers’ organization, labor unions, job training institutions, NGOs to provide one stop services

14 Korean Unemployment Measures 14 Table 3-3. Budget for unemployment measures (Billion Won) Total budget for unemployment measures Memorandum items Total budget for unemployment measures as a percentage of GDP Total expenditure on labour market m easures as a percentage of GDP Share of expenditures on active measures in total expenditure on labor market programs (%) 70 45

15 Expenditures on Labor Market Programs 15 Table 3-4. International comparison of expenditures on labor market programs in periods of rising unemployment Unemployment rate Government expenditures on labor market programs as a percentage of GDP a) TroughPeakTroughPeakChange between peak and trough Australia(1989, 1993) Belgium(1991, 1994) Canada(1989, 1992) Finland(1989, 1993) France(1990, 1994) Germany b) (1991, 1994) Korea(1997, 1999) New Zealand (1989, 1992) Spain(1990, 1994) Sweden(1989, 1994) United Kingdom (1990, 1993)

16 ALMPS: Training Programs 16 Table 3-5. Training programs for the employed: participation and expenditures, January to June 1999 TotalIn-plant vocational training Number of firms providing training23011 (100.0) (71.0) Number of trained workers (A) (100.0) (96.5) Program expenditures (000's of Won) (B) (100.0) (61.9) Average expenditure per participant(B/A) Paid training leaveSubsidies for Course attendance Loans for school fees Number of firms providing training148 (0.6) (28.4) Number of trained workers (A)1425 (0.5) 15 (0.0) 7963 (3.0) Program expenditures (000's of Won) (B) (5.8) (0.0) (32.2) Average expenditure per participant(B/A)

17 ALMPs: Vocational Training Programs 17 Table 3-6. Benefits of the in-plant vocational training program, by firm size, 1999 Firm size (number of workers) TotalLess than More than 1000Construction a) Subsidized firms (A)43511 (100.0) (70.0) 9946 (22.9) 3087 (7.1).. Firms paying Contributions (B) (100.0) (94.7) 4679 (0.8) 531 (0.1) (4.5) Firms' participation rate (%) (A/B) Subsidized workers ( C ) (100.0)(12.6)(29.7)(57.7).. Insured workers (D) (100.0)(59.0)(20.8)(18.7)(1.6) Workers' participation rate (%) (C/D) Amount of subsidies (000s of Won) (100.0) (14.0) (32.1) (53.8)..

18 ALMPs: Outcomes of Training Programs 18 Table 3-7. Outcomes of training programs for the unemployed TotalReemployment training a) of the unemployed under the EIS Training programmes not financed by the EIS Employment promotion Crafts -men 3-D jobs Business start ups New labor market entrants Other programs 1998 Total number of trainees (100.0) (46.9) (28.0) (4.0) (3.0) (3.7) (11.9) 9011 (2.5) Number of trainees who Completed the course Completion rate b) Found employment c) (22.4) (22.5) 7218 (19.3) 6326 (48.9) 2610 (29.9) 561 (4.5) 562 (9.8)..

19 ALMPs: Outcomes of Training Programs 19 Table 3-7. Outcomes of training programs for the unemployed TotalReemployment training a) of the unemployed under the EIS Training programmes not financed by the EIS Employment promotion Crafts -men 3-D jobs Business start ups New labor market entrants Other programs 1999 Total number of trainees (100.0) (63.2) (19.4) (4.7) 9122 (2.5) 7725 (2.2) (2.8) (5.3) Number of Trainees who Completed the course Completion rate b) Found employment c) (37.1) (38.8) 7299 (33.9) 1672 (36.5) 936 (100.0) 517 (10.5) 1608 (41.5) 607 (24.1)

20 ALMPs: Employment Stabilization Programs 20 Table 3-9. Utilizations of employment stabilization programs by firm size,1998 Number of firms receiving subsidies as a share of the total number of insured firms Firm size Total number of insured firms (A) Number of firms receiving subsidies(B) Rate of utilizations of subsidies(B/A) Total and over Source : KLI(1999b).

21 Public Employment Services 21 Table Public and private employment offices Ministry of Labor officesLocal government officesPrivate employment offices a) a) a) offices staff :Data not available a) 31st December Source L Ministry of Labor.

22 Public Employment Services 22

23 Public Employment Services 23 Table Basic PES flows, stocks and market share indicators Korea a) Belgi um Den mark Fin land Germ any Ire land Japan Nether lands Spain United Kingdom United States PES Administrative data (000s) Annual vacancy registrations b) Annual placements c) Labor market data Dependent employment (000S)

24 Public Employment Services 24 Table Basic PES flows, stocks and market share indicators Korea a) Belgi um Den mark Fin land Germ any Ire land Japan Nether lands Spain United Kingdom United States Monthly Hiring rate (approximate) d) Derived indicators(%) Placements/ registered job vacancies Registered job vacancies/ Dependent employment Placements/ dependent employment

25 Public Employment Services 25 Table Basic PES flows, stocks and market share indicators Korea a) Belgi um Den mark Fin land Germ any Ire land Japan Nether lands Spain United Kingdom United States Registered job vacancies /hiring Placements/ hiring :Data not available. a) Placement and vacancy data refer to the chain of PES offices administered by the Ministry of Labor. b) Vacancies notified to the PES by employers (in Denmark, also vacant positions advertised in newspapers and used by PES). c) Countries may use different definitions, such as placements filled with the active help of the PES, or place ments into vacancies notified to the PES which have been filled by PES registered job seekers. d) Monthly new hiring as a percentage of dependent employment. Estimates for OECD countries are based o n a combination of data from labor force surveys (job tenure less than one year, number of job changes in t he last three months), employer surveys (number of external hires, new employment contracts in the privat e sector) or administrative records of hiring kept by the PES. The Korean figures are based on smaller firm s and that a small number of job starts consists of transfers within the same company or establishment.

26 Characteristics of Employment and Job Training Programs 26  Australia : Privatization of employment service and introduction of competition system among service providers  Netherlands: Division of private and public sectors for employment service programs  Public sector: social welfare benefits and labor market information  Private sector: assistance for active job seeking (individual level services such as counseling, planning, diagnosis, training, assisting job seeking and post management)

27 Characteristics of Employment and Job Training Programs 27  United States: Workforce investment act: WIA, 1998  Improving system integration and service coordination  Providing universal access (one-stop service delivery structure)  Enhancing effectiveness of the service programs  Partnership among federal, states, local and private sectors

28 Characteristics of Employment and Job Training Programs 28  United Kingdom: Department for Work and Pensions, 2001  Social welfare services and employment services  Systematic approaches for social welfare, employment, and job training services

29 Characteristics of Employment and Job Training Programs 29  Germany  Introduction of competition system between public and private sectors in providing employment  Voucher system in assisting job seeking services (2004)

30 Implications for Romania Employment and Job Training Services 30  Needs to provide comprehensive services: one stop service for employment, job training, and welfare services  User friendly services  Providing customer specific services  Establishment of partnerships among related parties and outsourcing through private sectors  Targeted group approaches  Services for employers


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