Summary of study findings

1. Eurociett / UNI Europa Pan-European conference: • Temporary agency work and transitions in the labour market • Brussels, 19 December 2012 Summary of study findings Eckhard Voss • in cooperationwith: • Institute forEmployment Studies (UK) • IRES Rome (Italy) • ORSEU, Lille (France) • Lentic – Ecole de Gestion de l'Université de Liège (Belgium)

2. Overview of the study • Systematic review of data and research on how TAW contributes to facilitating transitions in the labour market, in line with the concept of “making transitions pay” • 1st layer: Overview of TAW in EU27 • Gathering comparable data and information on TAW on the basis of existing data, focussing on: • Dynamics of TAW during the last decade • Regulatory frameworks • Profile of TAW workers • Working conditions and equal treatment • Industrial relations, collective bargaining and social dialogue • 2nd layer: In-depth analysis of 6 countries • Following a comparative format of contents and data • Review of results regarding TAW and labour market transitions • Role of social partners and social dialogue • 3rd layer: Case studies of labour market transitions • Unemployment to work • Temporary to permanent work • Education to work • Target groups • Role of social partners

3. Temporary agency work in Europe • In 2010, according to CIETT Economic report 2012, the total number of temporary agency workers worldwide was 10.4 million in FTEs; Europe accounted for 35%, i.e. 3.6 million • Share in total employment in EU27 today is around 1.4% on average with significant differences • Cyclical nature of TAW: employment trends before, during and after the crisis • Between 2000 and 2008, the TAW workforce increased by more than 47% while total employment increased only by 7.8% • Most significant relative increases between 2000 and 2008 in PL, FI, IT, DE and AT • Increase also in matured markets such as UK (18.8%), NL (32.2%) or BE (29.6%) • Employment reduction in TAW due to the 2008crisis was much stronger than in overall employment (-17.5% compared to -1.8%) • Since 2009 however, the TAW sector againexperienced a growth thatwas stronger than employment growth ingeneral

4. National legal and other frameworks of temporary agency work • Temporary agency work is very heterogeneously regulated across Europe • There are differences in what is regulated – for example, whether or not this embraces reasons for using TAW, prohibited sectors, maximum assignment length, or stipulations concerning the employment contract, training and representation rights. • Maturity: in nearly half of the EU member states, regulation started only during the last decade • Impact of the European Directive on TAW: • Development of a common understanding of temporary work agencies, temporary agency workers, user companies, assignments etc. • Defining a legal framework in countries where it hasn’t existed so far

5. Profile of tempoary agency workers • Gender • Range from quite balanced shares (IT, NL, PL) to high shares of female TAW (UK, FI, DK, SE) and countries characterised by the contrary (DE, AT, BE) • Age • Young people have a high share in TAW, but the share of older workers is increasing • Sector composition • Strong bias towards manufacturing in countries such as DE, PL, CZ, while in UK, NL or ES more than 50% of temporary agency workers are employed in services • Apart from economic structures also a result of regulation and existence of other more flexible forms of employment contracts • Target groups • In particular people with a migrant background, long-term unemployed and peopole with a lower qualification/education profile • Other aspects: • Length of assignments and average duration of contracts with the agencies differs quite significantly - resulting also from regulatory frameworks (synchronisation, part-time/open-ended contracts etc.) • Motivation of becoming a TAW worker: “spring boarders“ being the largest single type of agency workers but there are also others that do not look for permanent/direct work (“flex-professionals“, “extra earners“, students)

6. Industrial relations and collective bargaining • IR mirrorsvarietyand different models in Europe • Two broad groups may be identified: • Social dialogue driven practice: In countries such as the Netherlands, Belgium, France or Italy both employers’ associations and trade unions are playing an important role in regulating temporary agency work, defining certain minimum standards and payment conditions and levels. Social partners in these countries are involved in dialogue, consultation and bargaining at all relevant levels and have established special funds and other joint institutions of self-regulation • Market driven practice: Experience the practice in other EU countries is characterised by either weak or non-existing structures of dialogue and bargaining at sectoral or cross-sectoral level and much weaker social partners in terms of mandate and representativeness. Here, bargaining at best is taking place at micro/company level and working conditions and labour standards are mainly driven by legal minimum standards • This division is also reflected in the general picture of industrial relations and collective bargaining where two broad groups exist:

7. Temporary agency work and transitions in the labour market • EU Directive:“(TAW) contributes to job creation and toparticipation and integration in the labourmarket” • Temporary agency work as a “bridge” and/or a “stepping stone” • Problems and difficulties • Methodical problems: often control groups are missing; control of different variables and determinants • Studies based on large samples/data sources exist in all countries but mainly from a descriptive perspective • A large number of surveys are based on smaller numbers of interviews amongst temporary agency workers, agencies and user companies • As comparative data/studies don’t exist, it is not possible to quantify stepping-stone effects for an aggregated sample of EU countries

8. Temporary agency work and transitions from unemployment to work • High proportion of formerly unemployed as well as people without any previous professional experience (e.g. in FR or BE around 40%, in Germany more than 60%) illustrate the important role of TAW in regard to transitions from unemployment to work • A growing share of people enter the labour market from unemployment or for the first time via temporary agency work – in NL or BE around 30% of formerly unemployed persons find a job via temporary agency work • Studies based on larger statistical analysis confirm “bridging” effect of temporary agency work, but in most cases are descriptive studies based on timing of events surveys, i.e. describing the share of formerly unemployed persons that find work through TAW and stay in work for a longer period of time • Only few studies have tried to estimate a “net effect” of the stepping-stone/bridging function by comparing unemployed who returned to work via TAW with the path of those who took alternative routes back into work • The results of these surveys illustrate either no significant difference (NL study based on CWI data 2001 - 2005) or a slightly positive effect (DE study based on statistics of the federal labour agency) in comparison to other routes • Due to methodical differences, the results are not comparable

9. Temporary agency work and transitions into permanent employment • Stepping stone effect of temporary agency work is an issue of debate in employment policy reform as well as between social partners • Various research confirms that there is a stepping-stone effect • Studies come to quite different results regarding “adhesive effects” (both at user companies as well as in other direct employment), e.g. Germany 7-12% (1st half of 2008) • Belgium study (covering 2005 – 2008): insertion rates of 30% (after one year), 41% (after two years) and 55% (after three years) • A type of research that wouldbe needed more:A Dutch study based on LFSdata (1996 – 2010) addressedthe question what formof flexible employmentoffers the best prospects forpermanent employment • More longitudinal studiesillustrate that stepping-stoneeffects vary significantlydepending on the labour marketsituation Source: Ronald Dekker/Hester Houwing/LianKösers: Van flexibelnaar vast? De doorstroomnaar vast werk van eengroeiendegroepflexwerkers, CBS, Den Haag, 2011

10. Temporary agency work and transitions from education into work • Young people (including those in education) are an important and sometimes the most important age group within the TAW workforce • Share of under 25 years old is high in NL (46%) and BE (37%); in FR, IT and DE are more than 40% are younger than 30 years old • TAW a more and more important entry into the first job: In France in 2010, 84% of those under 25 years entering the labour market via TAW have never worked before; in Germany, 10% of those entering the labour market for the first time in 2011 did so via TAW; • Only few research studies has compared the trajectories of young people within TAW with those choosing alternative ways • Certain groups of young people rely much more on temporary agency work than others as an entry channel into work and find it easier or more difficult to make further transitions • For young professionals temporary agency work may be an attractive way to gain work experience with different employers and develop careers • For young people with low qualification and educational attainment, temporary agency work often is the only chance on the labour market and they find it difficult to make further transitions into direct employment if this is not actively supported

11. Temporary agency work and target groups • For persons belonging to target groups (e.g. older employees, persons with education/qualification level/profile that doesn’t match labour market needs, migrants and ethnic minorities) temporary agency work provides an important bridge into the labour market • France: share of older workers increase twice as much as average number of TAW workers; for more than 90% TAW provides a useful possibility to find a job • Belgium: TAW increases the chance to find direct/permanent employment also for persons belonging to target groups • Important role of TAW for labour market integration is also illustrated by many initiatives developed by the temporary agency work sector either unilaterally or in cooperation with public employment administrations Low qualification Ethnic minorities Source: IDEA Consult 2009

12. The role of social partners for fostering transitions in the labour market • The role of social partners is pivotal for “making transitions pay” as they complement regulation on temporary agency work and develop initiatives to enhance the quality of transitions • Bipartite funds so far are the onlymechanisms/institutionsthat focus on skills developmentand employability of temporaryagency workers at sector level • In France, 80% of temporaryagency workers state thattraining measures undertakenwere useful to find the current job • Bipartite funds and other jointinitiatives as well as collectivebargaining agreements are alsoimportant to enhance the employment conditions of temporary agency workers • Regular monitoring and reviewing of training activities are a further important aspect of bipartite training funds that also identifies challenges and further needs, e.g. stronger concentration of activities for temporary agency with a low educational profile or no vocational qualification • But: Our sample of countries is not representative

13. Assessing the impact of social dialogue on temporary agency work

14. Conclusions • The study confirms that temporary agency work is a form of employment that not only contributes to the fluidity (flexibility) of the labour market but also provides opportunities in particular for unemployed persons and target groups as a bridge into work • The question of “what fosters quality transitions” is more difficult to assess – here, apart from the economic climate, the labour market structure and regulatory framework of temporary agency work, social dialogue and initiatives and practices developed by social partners and established by collective bargaining at national/sector level seems to play a key role. • Our study shows that in particular in those countries which have established bipartite funds and related initiatives, these also have triggered follow-up activities such as monitoring, surveys amongst temporary agency workers and in general a strong interest in issues such as training, skills development and employability • Against this, and the fact the main challenge for the future will be to broaden good practice experience and initiatives that complement legal regulatory frameworks by joint initiatives and practice of social partners

15. Contact Eckhard Voss Senior researcherandpartner wilke, maack und partnerSchaarsteinwegsbrücke 2 D-20459 Hamburg eckhard.voss@wilke-maack.de Fon: +49(0)40.432787 41 Fax: +49(0)40.432787.44 www.wmp-consult.de