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Making Labour Market Policy More Flexible While Preserving Accountability

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Making Labour Market Policy More Flexible While Preserving Accountability Employment Region Copenhagen & Zealand The Danish National Labour Market Authority Making Labour Market Policy More Flexible While Preserving Accountability Venice, 18 April 2008 Jan Hendeliowitz LEED Vice-chair, OECD-LEED Committee Director of Employment Region Copenhagen & Zealand The Danish National Labour Market Authority Denmark 080418-Venedig Employment Region Copenhagen & Zealand The Danish National Labour Market Authority Facts about Denmark • Total population 5.4 million • Work force 2.9 million • Employed people 2.8 million • Employment rate 76.8 % • Unemployment rate 2.1 % • Youth unemployment 1.9 % source: www.jobindsats.dk (Statistics Denmark) 080418-Venedig Employment Region Copenhagen & Zealand The Danish National Unemployment rates in Denmark, EU and OECD Labour Market Authority 1991-2007 12,0 10,0 8,0 6,0 Procent 4,0 2,0 0,0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Denmark EU OECD Source: OECD 080418-Venedig Employment Region Copenhagen & Zealand The Danish National Labour Market Authority The Danish Flexicurity Model Limited degree of employment protection and high job mobility - 800,000 or circa 30 % of all Danish wage earners change their jobs each year - 20% of the work force experiences unemployment each year The main axis of the flexicurity Flexible model labour market The qualification effect of the LMP Generous Active welfare LMP schemes Motivational Activation is both a right and an obligation effects of LMP High compensation rates - In Denmark 1.7 % of GDP is spent on active measures and 2.5 % on passive measures - 3000 USD a month before tax 080418-Venedig Employment Region Copenhagen & Zealand The Danish National The main elements of the Labour Market Authority flexicurity model • A flexible labour market with low employment protection and high job mobility • A generous welfare system with high income security • An active labour market policy • Collective agreements between the parties in the labour market • Dynamic legislative process – regular review and revision 080418-Venedig Employment Region Copenhagen & Zealand The Danish National The political and institutional Labour Market Authority set-up of the Employment Service Minister for Employment The National National level Sets the focus areas and objectives of the employment effort Employment Council National Labour Market Authority Contract Regional operational units 4 Employment Regions Responsible for supervision of the labour market etc. 4 regional Supervision of effects and outcomes etc., including employment follow-up of the Minister's objectives Regional level councils Approves the States part of the performance audit and the employment Supervision and follow-up of plan the effects and outcomes of the job centres’ total employment effort 77 job centres 14 pilot job centres State service 91 local employment councils Local level Municipal service Municipal service The municipal councils approve the performance audit and the employment plan for their own job centres. In each job centre the state and the municipality share the responsibility for the employment effort. In the pilot job centres the municipal council alone approves the performance audit and the employment plan. 080418-Venedig Employment Region Copenhagen & Zealand The Danish National The planning and monitoring process Labour Market Authority in Job Centres Analysis of the labour market situation Analysis reports compiled by the Employment plan Employment Regions and the The final employment Regional Employment Councils plan is sent to the Regional Employment National targets Council The Minister announces the national targets and focus areas for next year October - Jan - December March Regional targets The targets are specified in a contract between the Minister, the Employment Juli - April - Regions and the Regional September June Employment Councils Follow up and supervision Local targets Regular follow-up of The job centres involve the the job centres Local Employment Councils performance by the in the process of setting the employment regions local targets for the coming year 080418-Venedig Employment Region Copenhagen & Zealand The Danish National The national performance targets for 2008 set Labour Market Authority by the Minister of Employment Performance target 1: • Decrease in the number of unemployed people over 3 months. Performance target 2: • Focus on people who have been unemployed for more than a year, as well as the targets set under the national initiative known as ”A New Chance For Everyone”. These targets are: 1) 25 per cent will enter employment or training 2) The target group will be self-supporting 15 per cent of the time 3) The target group will be participating in an activation scheme 40 per cent of the time. Performance target 3: • Decrease in the number of unemployed young people (i.e. those under 30) 080418-Venedig Employment Region Copenhagen & Zealand The Danish National Labour Market Authority Follow-up procedures • The Employment Regions closely follow up the performance outcomes being pursued in the job centres • Quarterly analysis reports are compiled by the Employment Regions on the basis of the overall national and regional targets • The reports contain an assessment of the effects and outcomes achieved by the respective Employment Regions, plus a benchmarking of the individual job centres • Dialogue meetings concerning outcomes are held with the Job Centres twice a year or more 080418-Venedig Copenhagen& Zealand The Danish National The Employment Employment Region Market Authority Labour Source: Effects of employment efforts in the Source: Eastern New Chance for Everyone”Chance that for New is self ofproportion the targetThe of long group Example of benchmarking of JobCentres of benchmarking of Example Denmark Employment Region, 3rd quarter of quarter 2007 Employment Denmark Region, 3rd - supporting, 3 45,0% - 40,0% term unemployed on social welfare ”A 35,0% 30,0% rd 25,0% ofquarter 2007 20,0% 15,0% 9,7% 10,0% 5,0% 0,0% 080418 Faxe Sorø Lejre Køge Greve Herlev Solrød Egedal Furesø Stevns Tårnby Lolland Allerød Holbæk Hillerød Ballerup Slagelse Rødovre Glostrup Roskilde Gentofte Lyngby- Halsnæs Taastrup Brøndby Gladsaxe Ringsted Gribskov Næstved Hvidovre - Bornholm Helsingør Hørsholm Rudersdal Odsherred - Venedig Vallensbæk København Albertslund Kalundborg Østdanmark Fredensborg Vordingborg Frederiksberg Frederikssund Høje Guldborgsund Copenhagen& Zealand The Danish National The Employment Employment Region Market Authority Labour Source: Effects of employment efforts in the Source: Eastern September 2006September development The in the of unemployed number youngpeople in the period Example of benchmarking of JobCentres of benchmarking of Example – September 2007September Denmark Employment Region, 3rd quarter of quarter 2007 Employment Denmark Region, 3rd 20,0% 10,0% 0,0% -10,0% -16,6% -20,0% -30,0% -40,0% Faxe Sorø Lejre 080418 Køge Greve Herlev Solrød Egedal Stevns Furesø Allerød Tårnby Lolland Holbæk Hillerød Slagelse Ballerup Halsnæs Brøndby Roskilde Rødovre Næstved Gentofte Ringsted Glostrup Gladsaxe Hvidovre Gribskov Helsingør Bornholm Hørsholm Rudersdal Odsherred Vallensbæk København Albertslund Kalundborg - Østdanmark Vordingborg Fredensborg Venedig Lyng.-Taarb. Frederiksberg Høje-Taastrup Guldborgsund Frederikssund Employment Region Copenhagen & Zealand The Danish National Labour Market Authority In summary: The Job Centres • Have a high degree of freedom in planning and implementing their employment initiatives and activities • Are obliged to focus on outcomes, and to achieve results which contribute to the realization of the national and regional outcome performance The Employment Regions • Are responsible for ensuring coherence between the local initiatives and the National Employment Policies • Follow up the performance outcomes of the employment measures being pursued in the job centres The Minister of Employment • Sets the national targets and focus areas 080418-Venedig.
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