ISTAT:%20Francesca%20Della%20Ratta,%20Elisa%20Marzilli%20and%20Federica%20Pintaldi

1
2nd Meeting of the Task Force on the Measurement
of Quality of Employment (28-29 May 2009 Geneva
Switzerland)
A Validation Study of theQuality of Employment
Indicators work in progress

• ISTAT Francesca Della Ratta, Elisa Marzilli and
  Federica Pintaldi

2
Quality of Employment a conceptual framework

• 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

Nevertheless, there are several attempts to wrap
them up in a general conceptual framework
3
Quality of Employment validation study

• 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

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
4
Validation study the steps

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

5
Quality of Employment Decent Work
1. Safety and ethics of employment Employment safety Child labour and forced labour 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 Income from employment Benefits from employment 2. Adequate earnings and productive work
3. Working hours and balancing work and non-working life Working hours Working time arrangements 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 Stability and security of work Social protection 6. Stability and security of work 9. Social security
5. Social dialogue and workplace relationships Social dialogue Workplace relationships 10. Social dialogue, workers and employers representation
6. Skills development and life-long learning 1. Employment opportunities
7. Intrinsic nature of work 11. Economic and social context for decent work
6
Quality of Employment Decent Work
1. Safety and ethics of employment Employment safety Child labour and forced labour 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 100.000 employees)
• Non-fatal occupational injury rate (Workplace
  accidents per 100.000 employees)
• Occupational injury insurance coverage
• Labour inspection (inspectors per 100.000
  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

7
Quality of Employment Decent Work
2. Income and benefits from employment Income from employment 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

8
Quality of Employment Decent Work
3. Working hours and balancing work and non-working life Working hours Working time arrangements 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
  20-49
• Share of women receiving maternity/family leave
  benefits
• Share of men receiving paternity/family leave
  benefits
• DW
• Maximum hours of work
• Paid annual leave

9
Quality of Employment Decent Work
4. Stability and security of work and social protection Stability and security of work 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

10
Quality of Employment Decent Work
5. Social dialogue and workplace relationships Social dialogue 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

11
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 Employment Decent Work
7. Intrinsic nature of work
No indicators proposed
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Quality of Employment Decent Work
1. Employment opportunities

• DW
• Employment-to-population ratio 15-64 years
• Unemployment rate
• Youth not in education and not in employment
  15-24 years
• Informal employment
• Government commitment to full employment
• Unemployment insurance

Quality of Employment Decent 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

13
Quality of employment selection of Countries
We selected 25 Countries that are members of
UNECE through several criteria
COUNTRIES COUNTRIES
Austria Lithuania
Belgium Netherlands
Bulgaria Norway
Czech Republic Poland
Denmark Portugal
Finland Romania
France Slovakia
Germany Slovenia
Greece Spain
Hungary Sweden
Ireland Switzerland
Italy United Kingdom
Latvia

• 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

14
Quality of employment variables selected

• Selection of quantitative variables
• for Principal Component Analysis

15
Quality of employment quantitative variables
Variable Note
Standardised incidence rate of accidents at work (rate per 100 000 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 100.000 workers) Which denominator?
Fatal accident (rate per 100.000 employees) Which denominator?
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 Which is better? Meaning? Not available for AT. BG. CZ. EE. GR. HR. IS. LU. PT. SI
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Quality of employment variables collected
Indicator Note
ISCO1 Which is better?
ISCO2 Which is better?
ISCO3 Which is better?
ISCO1_3 Which is better?
Overeducation on isced5_6 Which denominator?
Overeducation on total employment Which denominator?
of the adult population aged 25 to 64 participating in education and training Only employed people?
17
Quality of employment variables collected
Variable Note
Share of employed women ok
Ratio of employment rate for women to the employment rate of men aged 25-49 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 20-49 / women without children aged 20-49 Which denominator? Not available for CH. DK. IE. IS. NO. SE
Occupational segregation by sex Interpretation?
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 Relevant? ILO Female in ISCO-88 groups 11 and 12
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Quality of employment variables collected
Variable Note
Average annual hours worked per person (NA) Which is better?
Average weekly hours actual worked (LFS) Which is better?
working on Saturday A combination?
working on Sunday A combination?
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) Which denominator? IE not available
temporary employees (total employees) Which denominator?
temporary employees (total employment) Which denominator?
temporary employees with contract lt12 months Not available for UK and EE
19
Quality of employment variables collected
Variable Note
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 ILO. A combination?
Maximum weekly hours limits ILO (GR not available)
Public social security expenditure as GDP Not available for CH
20
Quality of employment variables selected to PCA
Variable  Mean SD Minimum Maximum
Fatal accident (rate per 100.000 workers) 3.2 1.8 0.7 7.6
ISCO1_3 37.6 6.6 21.3 47.3
Overeducation on total employment 4.8 2.8 0.9 11.4
Share of employed women 45.2 2.6 38.8 49.3
Occupational segregation by sex 0.36 0.04 0.24 0.43
Average annual hours worked per person 1,754 183 1,419 2,069
Average weekly hours actual worked 38 2 32 41
working on Saturday 25.4 7.2 11.4 39.0
working on Sunday 13.8 3.2 7.0 20.2
working at evening 17.6 6.3 7.3 31.4
working at night 6.7 3 3.1 17.2
involuntary part-time2 (total employment) 2.9 1.7 0.3 6.0
Length of maternity leave (in weeks) 21 11 14 68
Paid annual vacation 23 3 20 30
Minimum annual leave (in working days) 22 3 20 30
Public social security expenditure as GDP 16 4 8.4 22.2
temporary employees (total employment) 10.0 6.1 1.1 26.1
temporary employees with contract lt12 months 61.0 19.5 23.9 91.9
of population aged 25 to 64 participating in education and training 11.2 9.1 1.3 32.4
21
Principal Components Analysis eigenvalue
Two main dimensions underlying the variables the
first principal component explains about 28 of
variability The second about 15
The first factorial plane accounts for a large
part of total variability (43)
22
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 didnt 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)

23
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
24
Principal Components Analysis factorial plane
Atypical working hours ()
Social protection and skill development (-)
Social protection and skill development ()
Atypical working hours (-)
25
Quality of employment legislative indicators

• Selection of qualitative variables about
  legislative indicators
• for Multiple Correspondence analysis

26
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
• http//www.ilo.org/public/english/protection/condt
  rav/database/index.htm
• Other indicators are collected from Doing
  Business of World Bank. Referring to the
  dimension Employing Workers we considered only
  simple indicators (no composite index)

27
Qualitative indicators from ILO
Indicators definition 
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
28
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?
29
Qualitative indicators minimum wage
Minimum wage has different mechanisms and levels
among countries
30
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 16.0 84.0 100.0
31
Qualitative indicators annual leave and
fixed-term contract
ILO
In the most countries there is a maximum duration
of fixed-term contracts
DB
32
Qualitative indicators maternity leave
The most countries have more then 14 weeks but
differently paid
33
Qualitative indicators other variables
Indicators Yes No Total
Are fixed-term contracts prohibited for permanent tasks? 48.0 52.0 100.0
Possibility to extend to 50 hours to respond to a seasonal increase in production 88.0 12.0 100.0
Restrictions on night work 84.0 16.0 100.0
Restrictions on weekly holiday work 92.0 8.0 100.0
Legally authorized termination of workers due to redundancy 100.0 0.0 100.0
Must the employer notify a third party before terminating a group of 25 redundant workers? 100.0 0.0 100.0
Does the employer need the approval of a third party to terminate one redundant worker? 4.0 96.0 100.0
Does the employer need the approval of a third party to terminate a group of 25 redundant workers? 16.0 84.0 100.0
Is there a retraining or reassignment obligation before an employer can make a worker redundant? 60.0 40.0 100.0
Are there priority rules applying to redundancies? 60.0 40.0 100.0
Are there priority rules applying to re-employment? 48.0 52.0 100.0
Must the employer notify a third party before terminating one redundant worker? 40.0 60.0 100.0
No or less variability among the 25 countries
selected
34
Multiple correspondence analysis variables
ILO Monthly minimum wages (less than 1000 /over than 1000 )
ILO Minimum wage-fixing mechanism (Government consulting social partners o collective bargaining / Government without consulting social partners)
ILO Minimum wage-fixing levels (national fixing-wage / other fixing-wage)
ILO Minimum annual leave (10-23 days / more than 23 days)
ILO Length of maternity leave (18 weeks or more /14 to 17 weeks)
DB Are fixed-term contracts prohibited for permanent tasks? (yes / no)
DB Maximum duration of fixed-term contracts (12-24 months / 25-60 months / over 60 months)
DB Paid annual vacation for an employee with 20 years of service (18-22 days / 24-30 days)
DB Is there a retraining or reassignment obligation before an employer can make a worker redundant? (yes / no)
DB Are there priority rules applying to redundancies? (yes / no)
DB Are there priority rules applying to re-employment? (yes / no)
DB Must the employer notify a third party before terminating one redundant worker? (yes / no)
We analysed the more relevant legislative
variables collected In same cases we reduced the
number of modalities
35
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

36
MAC first factor labour protection legislation
variables modalities valour-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 CENTRAL ZONE 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 obligation 4.18
DB Are there priority rules applying to redundancies? Priority for redundancies 3.98
DB Are there priority rules applying to re-employment? Priority for re-employment 3.14
LOW
HIGH
37
MAC second factor industrial relations systems
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 -3.61
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 12-24 months -1.69
CENTRAL ZONE CENTRAL ZONE CENTRAL ZONE
ILO Minimum wage-fixing mechanism Government without consulting social partners 3.61
ILO Minimum wage-fixing levels National fixing-wage 3.75
ILO Monthly minimum wages Less than 1000 3.16
ILO Minimum annual leave 10-23 days 3.93
DB Maximum duration of fixed-term contracts 25-60 months 2.05
DB Are there priority rules applying to re-employment? No priority for re-employment 2.48
HIGH
LOW
38
Multiple correspondence analysis factor plane
Industrial relations systems (-)
Labour protection legislation ()
Labour protection legislation (-)
Industrial relations systems ()
39
Quality of employment quantitative and
qualitative data

• 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

40
Factorial plan first component of PCA and MCA
MCA - Labour protection legislation ()

-
PCA - Social protection and skill development ()
PCA - Social protection and skill development (-)
-
- -
MCA - Labour protection legislation (-)
41
Quality of employment quantitative and
qualitative data

• 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

MAPS
42
New steps indicators from Eurostat elaboration

• 1. Safety and ethics of employment
• Occupational segregation by citizenship
• Female share of employment in ISCO-88 groups 11
  and 12
• 2. 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)

43
New steps indicators not directly available

• 1. Safety and ethics of employment
• Occupational injury insurance coverage
• Labour inspection (inspectors per 100.000
  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

44
New steps no indicators proposed

• 7. Intrinsic nature of work

European Working Conditions 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
Ad hoc module Labour Force Survey
45
THANKS