Measuring employment vulnerability in Europe

• Date: 01 June 2016
• Published date: 01 June 2016
• Author: Oana CALAVREZO,Cristina BOBOC,Rémi BAZILLIER
• DOI: http://doi.org/10.1111/j.1564-913X.2014.00019.x

International Labour Review, Vol. 155 (2016), No. 2

Copyright © The authors 2016

Journal compilation © International Labour Organization 2016

* Laboratoire d’Économie d’Orléans (LEO-CNRS, UMR 7322), Université d’Orléans,

emails: remi.bazillier@univ-orleans.fr; oana.calavrezo@gmail.com. ** Department of Statistics

and Econometrics, Bucharest Academy of Economic Studies, email: cristina.boboc@csie.ase.ro.

Responsibility for opinions expressed in signed articles rests solely with their authors, and

publication does not constitute an endorsement by the ILO.

Measuring employment vulnerability

in Europe

Rémi BAZILLIER,* Cristina BOBOC** and Oana CALAVREZO*

Abstract. Two of the most notable trends in labour markets in Europe are the rise

in the number of atypical job contracts (e.g. xed-term contracts and temporary

work) and the increase in job turnover. The concept of “employment vulnerabil-

ity” can be used to describe these trends, which weaken the employer–employee

relationship. In this article, the authors measure this employment vulnerability, for

individual European countries, by creating two indices – an “employer-related vul-

nerability index” and a “job-related vulnerability index” – which are then aggre-

gated to form an overall employment vulnerability index.

L

abour market institutions, which are deeply rooted in long-term historical

processes and cultures, differ strongly from one country to the next. De-

spite these differences, two common labour market trends have been observed

in recent decades throughout Europe in response to social and economic fac-

tors – namely, the rise in the number of atypical job contracts and the increase

in job turnover. The lifelong, full-time and permanent employment of old is

becoming increasingly rare. Employment arrangements have become much

more varied, and can include xed-term contracts, part-time work, temporary

work or a combination of two part-time jobs.

The concept of “employment vulnerability” can be used to describe these

trends. While the concept of vulnerability has mainly been developed in the

context of the risk of poverty (Cheli and Lemmi, 1995; Qizilbash, 20 03; Ligon

and Schechter, 2003), the increasing levels of labour insecurity justify its use

in analysing the evolution of European labour markets.

The literature on employment vulnerability mainly focuses on devel-

oping countries. In this regard, the International Labour Organization (ILO)

denes workers in vulnerable employment as the sum of own-account

workers and contributing family workers (ILO, 2010). Bocquier, Nordman and

International Labour Review266

Vescovo (2010) propose different indicators of employment vulnerability for

seven economic capitals in West Africa. Job insecurity is identied as a major

concern for the poor, and linkages with poverty are numerous (World Bank,

20 01, p. 137 ).

In developed countries, the focus is on various aspects of employment

vulnerability and adverse treatment at work. Hudson (2006), Pollert and Charl-

wood (2009) and the Trades Union Congress (TUC) Commission on Vulner-

able Employment (2008) focus mainly on the level of wages. O’Regan, Hill

and Neathey (2005) and Taylor (2008) analyse the evolution of the labour

market, based on the notion of “risk capacity of worker vulnerability”. Saun-

ders (2003) proposes a multidimensional approach to analysing labour mar-

ket vulnerability in the Canadian context. Also adopting a multidimensional

approach, Bewley and Forth (2010), in their study on vulnerability to adverse

treatment, argue that the prevalence of adverse treatment may have a cyclic-

al component, since vulnerability was found to be related to an employee’s

ease of re-employment – i.e. the prevalence of adverse treatment may be ex-

pected to be greater when employers’ demand for labour is reduced such that

employees have fewer outside options. In a recent article, Bardhan and Tang

(2010) focus on “occupational vulnerability”, dened as the risk of job loss

owing to adverse economic shocks. However, their approach focuses on occu-

pations rather than workers. More generally, the literature on employment vul-

nerability is also related to that on employment quality.1 The main difference

between the two is that the literature on employment quality is more focused

on working conditions while that on employment vulnerability is more focused

on job security and unemployment risk.

The main contribution of our article is to propose an extended denition

of employment vulnerability, together with new indicators for European coun-

tries, using the 2008 European Social Survey. Using multiple correspondence

analysis (MCA), we identify an “employer-related vulnerability index” and a

“job-related vulnerability index”. By combining these two indices, we create

an aggregate employment vulnerability index, at country level.

The remainder of the article is divided into three sections. The rst is a

brief overview of the concept of employment vulnerability in the existing lit-

erature. The second section describes the measurement of employment vul-

nerability in Europe, and the third section concludes the analysis.

The concept of employment vulnerability

Vulnerability can be dened in terms of how hard it is for individuals to man-

age the risks or cope with the losses and costs associated with the occurrence

of risky events or situations (Bocquier, Nordman and Vescovo, 2010). “Risk”

is considered to be related to the likelihood of individuals being exposed to

1 See Green (2006), Fernández-Macías and Hurley (200 8) and Guergoat-Larivière (2011)

for a survey of different approaches, and Davoine, Erhel and Guergoat-Larivière (2008) for an

analysis of European indicators of work quality.