ISTAT: Francesca Della Ratta, Elisa Marzilli and Federica Pintaldi A Validation Study of the Quality of Employment Indicators: work in progress 2 nd Meeting of the Task Force on the Measurement of Quality of Employment (28-29 May 2009 Geneva Switzerland)

Social changes and fast evolution of labour market conditions involve mainly developing countries but reflect also on advanced economies Quality of employment assumes great relevance Monitoring and measuring its aspects is becoming even more relevant Up to now different qualitative aspects of work have generally been measured separately Social changes and fast evolution of labour market conditions involve mainly developing countries but reflect also on advanced economies Quality of employment assumes great relevance Monitoring and measuring its aspects is becoming even more relevant Up to now different qualitative aspects of work have generally been measured separately Quality of Employment: a conceptual framework Nevertheless, there are several attempts to wrap them up in a general conceptual framework

This project supports the Task Force An empirical approach for studying the validity of the indicators The difficulty to measure the indicators in practice Completeness/redundancy of the indicators selected The core of study is the linkages and degrees of correlation among the indicators This project supports the Task Force An empirical approach for studying the validity of the indicators The difficulty to measure the indicators in practice Completeness/redundancy of the indicators selected The core of study is the linkages and degrees of correlation among the indicators Quality of Employment: validation study We will show the work in progress of the validation study in order to refine the list of indicators to measure the Quality of Employment

1.Comparison the framework Quality of Employment with the framework Decent Work in order to highlight similarities and differences 2.Review availability of the indicators from several electronic database: Eurostat, ILO, UNECE, World Bank 3.Proceeding to the operational definition of the indicators in one o more variables 4.Summary statistics and the relation among indicators to first selection of them 5.Examination the performance of several indicators using: principal Components Analysis (PCA) for quantitative variables and Multiple Correspondence Analysis (MCA) for legislative indicators 6.Relation among quantitative and qualitative variables 1.Comparison the framework Quality of Employment with the framework Decent Work in order to highlight similarities and differences 2.Review availability of the indicators from several electronic database: Eurostat, ILO, UNECE, World Bank 3.Proceeding to the operational definition of the indicators in one o more variables 4.Summary statistics and the relation among indicators to first selection of them 5.Examination the performance of several indicators using: principal Components Analysis (PCA) for quantitative variables and Multiple Correspondence Analysis (MCA) for legislative indicators 6.Relation among quantitative and qualitative variables Validation study: the steps

6. Skills development and life-long learning 1. Employment opportunities 7. Intrinsic nature of work 11. Economic and social context for decent work Quality of EmploymentDecent Work 1. Safety and ethics of employment a)Employment safety b)Child labour and forced labour c)Fair treatment in employment 8. Safe work environment 5. Work that should be abolished 7. Equal opportunity and treatment in employment 2. Income and benefits from employment a)Income from employment b)Benefits from employment 2. Adequate earnings and productive work 3. Working hours and balancing work and non-working life a)Working hours b)Working time arrangements c)Balancing work and non-working life 3. Decent hours 4. Combining work. family and personal life 4. Stability and security of work. and social protection a)Stability and security of work b)Social protection 6. Stability and security of work 9. Social security 5. Social dialogue and workplace relationships a)Social dialogue b)Workplace relationships 10. Social dialogue, workers’ and employers’ representation

Quality of Employment Decent Work 1. Safety and ethics of employment a) Employment safety b) Child labour and forced labour c) Fair treatment in employment 8. Safe work environment 5. Work that should be abolished 7. Equal opportunity and treatment in employment QE and DW  Fatal occupational injury rate (Workplace fatalities per employees)  Non-fatal occupational injury rate (Workplace accidents per employees)  Occupational injury insurance coverage  Labour inspection (inspectors per employees)  Children working: average weekly hours by age and sex  Occupational segregation by sex/ citizenship QE  Children not in school by employment status  Share of employees working in "hazardous" conditions  Workplace expenditure on safety improvements as a share of total workplace labour costs  Employed women as a share of total employment  Gender pay gap DW  Occupational safety and health insurance  Child labour (incl. public policies to combat it)  Forced labour (incl. public policies to combat it)  Female share of employment in ISCO-88 groups 11 and 12  Anti-discrimination law based on sex of worker, race, ethnicity, religion or national origin

Quality of Employment Decent Work 2. Income and benefits from employment a) Income from employment b) Benefits from employment 2. Adequate earnings and productive work QE and DW  Low pay (share of employed with below ½ of median hourly earnings) QE  Share of employees entitled to paid annual leave  Average length of paid annual leave  Share of employees paid at minimum wage  Share of employees paid at below minimum wage DW  Working poor  Statutory minimum wage

Quality of Employment Decent Work 3. Working hours and balancing work and non-working life a) Working hours b) Working time arrangements c) Balancing work and non-working life 3. Decent hours 4. Combining work. family and personal life QE and DW  Share of employed persons working 49 hrs and more per week  Average annual (actual) hours worked per person  Time-related underemployment rate QE  % of employed people who usually work at night/evening  % of employed people who usually work on weekend or bank holiday  Share of employed persons working less than 30 hrs per week involuntarily  Ratio of employment rate for women with children under compulsory school age to the employment rate of all women aged  Share of women receiving maternity/family leave benefits  Share of men receiving paternity/family leave benefits DW  Maximum hours of work  Paid annual leave

Quality of Employment Decent Work 4. Stability and security of work and social protection a) Stability and security of work b) Social protection 6. Stability and security of work 9. Social security QE and DW  Percentage of employees with temporary jobs  Percentage of employees with job tenure of less than one year  Public social security expenditure as share of GDP QE  Share of employees covered by unemployment insurance  Share of economically active population contributing to a pension fund DW  Share of population aged 65 and above benefiting from a pension  Stability and security of work (developmental work to be done by the Office)  Employment protection legislation  Pension (public / private)  Incapacity for work due to sickness / sick leave  Incapacity for work due to invalidity

Quality of Employment Decent Work 5. Social dialogue and workplace relationships a) Social dialogue b) Workplace relationships 10. Social dialogue. workers’ and employers’ representation QE and DW  Share of employees covered by collective wage bargaining  Union density rate QE  Rate of days not worked due to strikes and lockouts (per 1000 employees)  Share of employees not covered by strike law DW  Enterprises belonging to employer organization  Indicator for Fundamental Principles and Rights at Work  Freedom of association and right to organize  Collective bargaining right  Tripartite consultations

Quality of Employment Decent Work 6. Skills development and life-long learning QE  Share of employed persons in high skilled occupations  Share of employees who received job training within the last 12 months  Share of employed who have more education than is normally required in their occupation Quality of EmploymentDecent Work 7. Intrinsic nature of work No indicators proposed

Quality of Employment Decent Work 1. Employment opportunities DW  Employment-to-population ratio years  Unemployment rate  Youth not in education and not in employment years  Informal employment  Government commitment to full employment  Unemployment insurance Quality of EmploymentDecent Work 11. Economic and social context for decent work DW  Children not in school (% by age)  % of working-age population who are HIV positive  Labour productivity (GDP per employed person)  Income inequality (percentile ratio P90/P10)  Inflation rate  Employment by branch of economic activity  Education of adult population  Labour share in GDP

Quality of employment: selection of Countries COUNTRIES AustriaLithuania BelgiumNetherlands BulgariaNorway Czech RepublicPoland DenmarkPortugal FinlandRomania FranceSlovakia GermanySlovenia GreeceSpain HungarySweden IrelandSwitzerland ItalyUnited Kingdom Latvia We selected 25 Countries that are members of UNECE through several criteria Eurostat data-base: at first we selected a group of 32 countries that belong to the European area Availability of indicators: only European countries for which the indicators were available Comparability of indicators: only countries which adopted the same methodology and standard to collect the data Consistency of employed population: we excluded countries with a number of employed population smaller than 500,000 Variability: we selected both EU Member States and not-EU Member States

Quality of employment: variables selected Selection of quantitative variables for Principal Component Analysis Selection of quantitative variables for Principal Component Analysis

VariableNote Standardised incidence rate of accidents at work (rate per workers). More than 3 days lost (4 days absence or more) Not available for BG. CY. CZ. EE. HU. LT. LV. MT. PL. RO. SI. SK Non fatal accident (ILO) Not available for DK. GR and NL. Comparability? Fatal accident (rate per workers) Which denominator? Fatal accident (rate per employees) Number of working days lost (1000) Which is better? Meaning? Not available for AT. BG. CZ. EE. GR. HR. IS. LU. PT. SI Working days lost per 1000 workers Quality of employment: quantitative variables

IndicatorNote % ISCO1 Which is better? % ISCO2 % ISCO3 % ISCO1_3 Overeducation on isced5_6 Which denominator? Overeducation on total employment % of the adult population aged 25 to 64 participating in education and training Only employed people? Quality of employment: variables collected

VariableNote Share of employed womenok Ratio of employment rate for women to the employment rate of men aged Redundant? High correlation with share of employed women Ratio of employment rate for women with children under compulsory school age to the employment rate of all women aged / women without children aged Which denominator? Not available for CH. DK. IE. IS. NO. SE Occupational segregation by sexInterpretation? Gender pay gap_1 Structure of Earnings Survey. Not available for AT. BE. CZ. DE. ES. FR. GR. HR. IS. IT. LU. MT. NO. PT. TR Gender pay gap_2 National sources: comparability? % ISCO1 women /ISCO1 Relevant? ILO: Female in ISCO- 88 groups 11 and 12 % ISCO1 women /% women employment Quality of employment: variables collected

VariableNote Average annual hours worked per person (NA) Which is better? Average weekly hours actual worked (LFS) % working on Saturday A combination? % working on Sunday % working at evening PT not available. Relevant? % working at night ok % involuntary part-time_1 (total employees) Which denominator? IE not available % involuntary part-time_2 (total employment) % temporary employees (total employees) Which denominator? % temporary employees (total employment) %temporary employees with contract <12 months Not available for UK and EE

VariableNote Paid annual vacation The paid annual vacation (in working days) for an employee with 20 years of service (Doing Business) Minimum annual leave (in working days) ILO (GR not available) Minimum wage ILO. Not available for DK. HR. NO. Comparability? Length of maternity leave (in weeks) ILO. A combination? Amount of maternity leave benefits Maximum weekly hours limits ILO (GR not available) Public social security expenditure as % GDP Not available for CH Quality of employment: variables collected

Variable MeanSDMinimumMaximum Fatal accident (rate per workers) % ISCO1_ Overeducation on total employment Share of employed women Occupational segregation by sex Average annual hours worked per person1, ,4192,069 Average weekly hours actual worked % working on Saturday % working on Sunday % working at evening % working at night % involuntary part-time2 (total employment) Length of maternity leave (in weeks) Paid annual vacation Minimum annual leave (in working days) Public social security expenditure as % GDP % temporary employees (total employment) %temporary employees with contract <12 months % of population aged 25 to 64 participating in education and training Quality of employment: variables selected to PCA

Principal Components Analysis: eigenvalue The first factorial plane accounts for a large part of total variability (43%) Two main dimensions underlying the variables: the first principal component explains about 28% of variability The second about 15%

Principal Components Analysis: first component The first component can be related to the social protection and skill development On one hand: high share of the adult population aged 25 to 64 participating in education and training, employment people in skilled occupations, and countries with high public social security expenditure. On the other hand: high number of fatal accident, high share of temporary employees with contract less of 12 months, and higher average annual hours worked per person Other variables didn’t use in PCA with an unexpected relation:  gender pay gap (0.45)  non fatal accident (0.36)  % involuntary part-time on total part-time (-0.41)

Principal Components Analysis: second component The second component can be related to the working time arrangement On one hand: high percentage of employment people who work on Saturday, on Sunday, at evening and at night On the other hand: high share of employed women, a longer length of maternity leave, higher occupational segregation by sex The relation among the indicators related to working time arrangement suggests to use a combination of them

Principal Components Analysis: factorial plane Social protection and skill development (+) Atypical working hours (+) Atypical working hours (-) Social protection and skill development (-)

Quality of employment: legislative indicators Selection of qualitative variables about legislative indicators for Multiple Correspondence analysis Selection of qualitative variables about legislative indicators for Multiple Correspondence analysis

Quality of employment: legislative indicators Working conditions laws are deeply connected to the quality of employment. Therefore, in addition to the quantitative indicators, we considered also some qualitative indicators related to labour market legislation and social protection Most of indicators come from the proposal of the Task Force on the Measurement of Quality of Employment and from the ILO Decent work. We looked at database of Condition of Work and Employment Laws of ILO that contains comprehensive legal information from countries Other indicators are collected from Doing Business of World Bank. Referring to the dimension Employing Workers we considered only simple indicators (no composite index) Working conditions laws are deeply connected to the quality of employment. Therefore, in addition to the quantitative indicators, we considered also some qualitative indicators related to labour market legislation and social protection Most of indicators come from the proposal of the Task Force on the Measurement of Quality of Employment and from the ILO Decent work. We looked at database of Condition of Work and Employment Laws of ILO that contains comprehensive legal information from countries Other indicators are collected from Doing Business of World Bank. Referring to the dimension Employing Workers we considered only simple indicators (no composite index)

Qualitative indicators: from ILO Indicatorsdefinition Monthly minimum wages is the lowest monthly wage that employers may legally pay to employees or workers Minimum wage fixing mechanism the mechanism by which minimum wage rate are set. Generally the Government plays a central role in setting minimum wage rates. These could be set in consultation with a specialized body Minimum wage fixing levels it is possible to identify 5 levels at which the minimum wage can be set: a) sector/occupation; b) national; c) national by sector/occupation; d) regional; e) regional by sector/occupation Normal weekly hours limits the hours that can be worked each week before overtime payments become due Maximum weekly hours limits maximum limit on weekly working hours Overtime limits most labour laws place an upper limit on overtime hours. These laws limit overtime differently Minimum annual leave working time laws generally provide for minimum holidays period to allow workers to take longer periods of rest Length of maternity leave the period in which mothers are allowed to take time off work in order to follow the birth of a child Amount of maternity leave benefits the level of benefits available during the maternity leave. Two elements are considered: a) the proportion of the worker's earning to be paid; b) the period over which they are to be paid Source of maternity leave benefits the system for founding maternity leave is classified in three forms: a) employer-founded; b) social insurance; c) mixed systems

Qualitative indicators: from World Bank Indicators Doing Business Are fixed-term contracts prohibited for permanent tasks? What is the maximum duration of fixed-term contracts (including renewals)? Can the workweek extend to 50 hours (including overtime) for 2 months per year to respond to a seasonal increase in production? What is the maximum number of working days per week? Are there restrictions on night work? Are there restrictions on "weekly holiday" work? What is the paid annual vacation (in working days) for an employee with 20 years of service? Is the termination of workers due to redundancy legally authorized? Must the employer notify a third party before terminating one redundant worker? Does the employer need the approval of a third party to terminate one redundant worker? Must the employer notify a third party before terminating a group of 25 redundant workers? Does the employer need the approval of a third party to terminate a group of 25 redundant workers? Is there a retraining or reassignment obligation before an employer can make a worker redundant? Are there priority rules applying to redundancies? Are there priority rules applying to re-employment?

Qualitative indicators: minimum wage Minimum wage has different mechanisms and levels among countries

Qualitative indicators: working hours The most countries maximum 48 weekly hours but overtime limits a lot variability Other indicator 5 days 6 days Total Maximum number of working days per week

Qualitative indicators: annual leave and fixed-term contract ILO DB In the most countries there is a maximum duration of fixed-term contracts

Qualitative indicators: maternity leave The most countries have more then 14 weeks but differently paid

Qualitative indicators: other variables IndicatorsYesNoTotal Are fixed-term contracts prohibited for permanent tasks? Possibility to extend to 50 hours to respond to a seasonal increase in production Restrictions on night work Restrictions on weekly holiday work Legally authorized termination of workers due to redundancy Must the employer notify a third party before terminating a group of 25 redundant workers? Does the employer need the approval of a third party to terminate one redundant worker? Does the employer need the approval of a third party to terminate a group of 25 redundant workers? Is there a retraining or reassignment obligation before an employer can make a worker redundant? Are there priority rules applying to redundancies? Are there priority rules applying to re-employment? Must the employer notify a third party before terminating one redundant worker? No or less variability among the 25 countries selected

ILO Monthly minimum wages (less than 1000 $ /over than 1000 $) Minimum wage-fixing mechanism (Government consulting social partners o collective bargaining / Government without consulting social partners) Minimum wage-fixing levels (national fixing-wage / other fixing-wage) Minimum annual leave (10-23 days / more than 23 days) Length of maternity leave (18 weeks or more /14 to 17 weeks) DB Are fixed-term contracts prohibited for permanent tasks? (yes / no) Maximum duration of fixed-term contracts (12-24 months / months / over 60 months) Paid annual vacation for an employee with 20 years of service (18-22 days / days) Is there a retraining or reassignment obligation before an employer can make a worker redundant? (yes / no) Are there priority rules applying to redundancies? (yes / no) Are there priority rules applying to re-employment? (yes / no) Must the employer notify a third party before terminating one redundant worker? (yes / no) Multiple correspondence analysis: variables We analysed the more relevant legislative variables collected In same cases we reduced the number of modalities

Multiple correspondence analysis: main results The first and the second factors explain the 45% of the general variance The first factor can be related to the labour protection legislation, especially concerning rules in case of redundancies and limit resorting fixed-term contracts The second factor can be related to the industrial relations system, especially concerning the social dialogue The first and the second factors explain the 45% of the general variance The first factor can be related to the labour protection legislation, especially concerning rules in case of redundancies and limit resorting fixed-term contracts The second factor can be related to the industrial relations system, especially concerning the social dialogue

variablesmodalitiesvalour-test DB Is there a retraining or reassignment obligation before an employer can make a worker redundant? No reassignment obligation-4.18 DB Are there priority rules applying to redundancies? No priority for redundancies-3.98 DB Are fixed-term contracts prohibited for permanent tasks? No limit fixed-term-3.61 DB Are there priority rules applying to re-employment? No priority for re-employment-3.14 ILO Minimum wage-fixing levels Other fixing-wage-2.15 CENTRAL ZONE DB Are fixed-term contracts prohibited for permanent tasks? Fixed-term prohibited for permanent tasks 3.61 DB Is there a retraining or reassignment obligation before an employer can make a worker redundant? Reassignment obligation4.18 DB Are there priority rules applying to redundancies? Priority for redundancies3.98 DB Are there priority rules applying to re-employment? Priority for re-employment3.14 HIGHHIGH LOWLOW MAC first factor: labour protection legislation

Variable item valour-test ILO Minimum annual leave More than 23 days-3.93 ILO Minimum wage-fixing levels Other fixing-wage-3.75 ILO Minimum wage-fixing mechanism Government consulting social partners or collective bargaining ILO Monthly minimum wages Over than 1000 $-3.16 DB Are there priority rules applying to re-employment? Priority for re-employment-2.48 DB Maximum duration of fixed-term contracts months-1.69 CENTRAL ZONE ILO Minimum wage-fixing mechanism Government without consulting social partners 3.61 ILO Minimum wage-fixing levels National fixing-wage3.75 ILO Monthly minimum wages Less than 1000 $3.16 ILO Minimum annual leave days3.93 DB Maximum duration of fixed-term contracts months2.05 DB Are there priority rules applying to re-employment? No priority for re-employment2.48 HIGHHIGH LOWLOW MAC second factor: industrial relations systems

Multiple correspondence analysis: factor plane Labour protection legislation (+) Industrial relations systems (-) Industrial relations systems (+) Labour protection legislation (-)

To analyse connections between quantitative and qualitative variables we considered jointly first factors obtained with PCA and MCA The projection of the countries to this factor plan highlights the importance to consider both type of indicators Quantitative indicators can be better interpreted considering the labour market legislation To analyse connections between quantitative and qualitative variables we considered jointly first factors obtained with PCA and MCA The projection of the countries to this factor plan highlights the importance to consider both type of indicators Quantitative indicators can be better interpreted considering the labour market legislation Quality of employment: quantitative and qualitative data

PCA - Social protection and skill development (+) MCA - Labour protection legislation (+) MCA - Labour protection legislation (-) PCA - Social protection and skill development (-) Factorial plan: first component of PCA and MCA

The maps help to give a quick and easy look to data Through colours and symbols, maps highlight relationships between labour market legislation indicators and quantitative indicators For instance, share of employed women can be better interpreted considering the length of maternity leave The maps help to give a quick and easy look to data Through colours and symbols, maps highlight relationships between labour market legislation indicators and quantitative indicators For instance, share of employed women can be better interpreted considering the length of maternity leave Quality of employment: quantitative and qualitative data MAPS

1. Safety and ethics of employment Occupational segregation by citizenship Female share of employment in ISCO-88 groups 11 and Income and benefits from employment Low pay (share of employed with below ½ of median hourly earnings) 3. Working hours and balancing work and non-working life Share of employed persons working 49 hrs and more per week Time-related underemployment rate % of employed people who usually work at night/evening % of employed people who usually work on weekend or bank holiday Share of women receiving maternity/family leave benefits (LFS ad hoc module) Share of men receiving paternity/family leave benefits (LFS ad hoc module) 4. Stability and security of work and social protection Incapacity for work due to sickness / sick leave (LFS ad hoc module) Incapacity for work due to invalidity (LFS ad hoc module) 6. Skills development and life-long learning Share of employees who received job training within the last 12 months 1. Safety and ethics of employment Occupational segregation by citizenship Female share of employment in ISCO-88 groups 11 and Income and benefits from employment Low pay (share of employed with below ½ of median hourly earnings) 3. Working hours and balancing work and non-working life Share of employed persons working 49 hrs and more per week Time-related underemployment rate % of employed people who usually work at night/evening % of employed people who usually work on weekend or bank holiday Share of women receiving maternity/family leave benefits (LFS ad hoc module) Share of men receiving paternity/family leave benefits (LFS ad hoc module) 4. Stability and security of work and social protection Incapacity for work due to sickness / sick leave (LFS ad hoc module) Incapacity for work due to invalidity (LFS ad hoc module) 6. Skills development and life-long learning Share of employees who received job training within the last 12 months New steps: indicators from Eurostat elaboration

1. Safety and ethics of employment Occupational injury insurance coverage Labour inspection (inspectors per employees) Children working: average weekly hours by age and sex Children not in school by employment status Share of employees working in "hazardous" conditions Workplace expenditure on safety improvements as a share of total workplace labour costs 2. Income and benefits from employment Share of employees entitled to paid annual leave Share of employees paid at minimum wage Share of employees paid at below minimum wage 4. Stability and security of work and social protection Share of employees covered by unemployment insurance Share of economically active population contributing to a pension fund 5. Social dialogue and workplace relationships Share of employees covered by collective wage bargaining Union density rate Share of employees not covered by strike law 1. Safety and ethics of employment Occupational injury insurance coverage Labour inspection (inspectors per employees) Children working: average weekly hours by age and sex Children not in school by employment status Share of employees working in "hazardous" conditions Workplace expenditure on safety improvements as a share of total workplace labour costs 2. Income and benefits from employment Share of employees entitled to paid annual leave Share of employees paid at minimum wage Share of employees paid at below minimum wage 4. Stability and security of work and social protection Share of employees covered by unemployment insurance Share of economically active population contributing to a pension fund 5. Social dialogue and workplace relationships Share of employees covered by collective wage bargaining Union density rate Share of employees not covered by strike law New steps: indicators not directly available

7. Intrinsic nature of work New steps: no indicators proposed European Working Conditions Survey Ad hoc module Labour Force Survey For instance Q37 How much do you agree or disagree with the following statements describing some aspects of your job? (Strongly agree; Agree; Neither agree nor disagree; Disagree; Strongly disagree; DK; Refusal) A - I might lose my job in the next 6 months B - I am well paid for the work I do C - My job offers good prospects for career advancement D - I feel myself ‘at home’ in this organization E - At work, I have opportunities to learn and grow F - I have very good friends at work

THANKS