From Industry 4.0 to Work The German experience. Queen s Interna,onal Ins,tute on Social Policy QIISP Kingston Ontario, 16 August 2018

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1 From Industry 4.0 to Work The German experience Queen s Interna,onal Ins,tute on Social Policy QIISP Kingston Ontario, 16 August 2018

2 German debate about Industry 4.0 Produc,vity and compe,,veness concerns Employment restructuring away from mediumskilled manufacturing / polariza,on Linking technological innova,on and social innova,on ( technology-centric vs. human-centric scenarios )

3 Risk of of Jobs Jobs at risk of significant change Jobs at high risk of automa,on Quelle: OECD Employment Outlook (2016), calcula,ons based on the Survey of Adult Skills (PIAAC)

4 Labor market in Europe, Low skill Middle skill High skill Source: OECD Employment Outlook 2017, Figure 3.A1. 4

5

6 Challenges Forecasted number of jobs likely to remain roughly similar over the next decade; star,ng point of debate is a moderate overall impact of the digital transforma,on on the employment level. However, a couple of issues arise: 1. Profound structural and occupa-onal changes in supply and demand of labour: stronger demand for highly skilled workers, outlook for medium skilled groups (voca,onal training) is more ambiguous, risk of job losses and polariza,on. 2. Rela,on between Germany s diversified quality produc,on (manufacturing) with incremental innova-on and the (rather) disrup,ve world of digital work and online plaborms. 3. Collec-ve bargaining and co-determina-on at firm level might help organize change, but scope of both is declining. 4. Dynamic labour demand meets increasingly diverse + older workforce. 5. Focus on poten,al erosion of social insurance funding, in par,cular if selfemployment/plaborm work grows.

7 process on Work 4.0 Dialogue ini,ated by government, with social partners and experts Key element: exploring needs and possibili,es of renewed labour market, HR and social policies, based on broad stakeholder par,cipa,on, s,mula,ng an itera,ve policymaking process. Main leitmo,ves: balanced mix of different forms of flexibility; labour market par,cipa,on and mobility, including lifelong learning; work-life balance and healthy working condi,ons; effec,ve social protec,on

8 Structure of the dialogue Timing: Ø Inaugural conference April 2015: ques,ons raised in a Green Paper. Ø Mid-term conference March Ø Closing conference November 2016: drag White Paper Involvement of variety of stakeholders: works councils/ trade unions, companies/employers associa,ons, other interest groups, think tanks, experts Two types of formats: 1. Expert dialogue: permanent expert group and several expert workshops, specific working,me dialogue; consulta,ons with self-employed; commissioned research 2. Public dialogue: via social media, surveys, film fes,val Final White Paper Work 4.0 early 2017

9 Main axes of debate Life long learning: essen,al in order to keep up with rapidly evolving technological developments. Addi,onal (digital) qualifica,ons will be compulsory in almost all sectors and occupa,ons. Aspira,on for a legal right to con,nuing voca,onal educa,on and training. Flexibility at work, working -me: greater self-determina,on, balance necessary between conflic,ng interests. Protec,on from over,me + breakdown of the boundaries on work is essen,al. Nego,ated working,me models and flexibility compromises are increasingly important. Health: health and safety must reflect digital transforma,on + demographic change, therefore necessary to focus more on psychological strain of work. Social protec-on, self employment: lines between employment and self-employed work are blurring, reasonable to include self-employed individuals in the statutory pension insurance system alongside employees. In case of an increase in plaborm work and new selfemployment, new protec,on strategies would have to be developed, tailored in par,cular to employee-like self-employed workers.

10 of main actors Trade unions: Extensive interest in the subject maker and welcome governmental interest. Main focus on a) employment status b) social protec,on c) earnings d) co-determina,on and advocacy. Trade unions see strong regulatory needs. Employers: Recognize the importance and possibili,es. Exis,ng regula,ons are generally deemed sufficient. Government: Essen,al to invest in boos,ng skills and improving individual prospects for advancement at an early stage. Balance must be struck between conflic,ng interests and goals. To successfully cope with digital structural change, the nego,a,on processes between the social partners and at firm-level need to be strengthened. Appropriate to include self-employed individuals in the statutory pension insurance system alongside employees.

11 Some policy ideas as stated in White Paper Employment insurance allowing for more preventa,ve use of unemployment issurance in par,cular for lifeling learning maybe also Personal Ac,vity Account (budget) for young people Legisla,on on right to choose working -me and opening clauses in working,me law Social insurance for the self-employed, in par,cular old-age pensions Stabiliza,on of social partnership, collec,ve bargaining and co-determina,on; generally binding collec-ve agreement in the social sector Regular repor-ng on changing world of work

12 Concrete steps undertaken Support and exchange on innova-ve work prac-ces at firm level, e.g. mobile working, flexible working,me, new organiza,onal models ( Experimen,erräume ) Coali-on agreement 2018 main points related to Work 4.0 topics: 1. More systema,c con,nuous training of employed Na,onale Weiterbildungsstrategie 2. Social protec,on of self-employed inclusion in public oldage pension insurance 3. Opening clause in working,me legisla,on

13 Insights with hindsight Main issues debated in the Work 4.0 context are longstanding topics of labor market and social policy, but new framing, mo,vated by technological change / automa,on, and linking to social innova-on General openness to collect and assess evidence on current developments, allow for experiments and design poten,ally innova,ve policy solu,ons Flexible tripar-te approach at different level seems feasible due to shared interest in produc,vity, innova,on and jobs in some fields more than in others, however Important issue: avoid dominance of old interests while finding formats for ar-cula-on and nego-a-on in new, less organized sectors Remarkable gap between public aken,on, discourse and concrete policies maybe corresponding to incremental changes in the labour market and in policy making

14 Werner Eichhorst IZA IZA, P.O. Box Bonn, Germany Phone: +49 (0) Fax: +49 (0)