With the Labour Market Monitor, the Chamber of Labour, in cooperation with the Austrian Institute of Economic Research (WIFO), each year prepares an EU-wide study on the labour market situation. The Labour Market Monitor 2019 is the ninth update to be published.
Based on data gathered by the Statistical office of the EU (Eurostat), AK and WIFO have applied the Labour Market Monitor to provide a comprehensive and comparable overview over the labour markets of the EU Member States on an annual basis since 2011. In doing so, not only the current direction of development is analysed, but the overview also deals with potential issues for a deeper analysis. While observing the labour market situation in the EU is often limited to a few key indicators - in particular the unemployment rate - the intention of the Labour Market Monitor is to examine a wide range of relevant aspects and to draw a more differentiated picture.
The 5 Dimensions
In 2010, the Chamber of Labour, WIFO and the European Trade Union Institute (ETUI) developed five labour market relevant dimensions, which enable a comprehensive analysis of the labour market. Subsequently, 58 indicators were defined, which should depict these dimensions as well as possible. A criterion on the one hand concerned content-related factors but also the availability and comparability of relevant data on the other. Assessed are the overall labour market performance, the participation, exclusion risks on the labour market, the distribution of earnings as well as the redistribution by the welfare state. Each of these five dimensions was built on a number of comparable and regularly available indicators throughout the EU, on the basis of which a range index - in this case a number between 1 and 10 - is created. That way it is possible to clearly depict and compare complex economic, political and social coherences. Apart from that, the study not only shows, which countries lead the way in the respective dimensions, but also what makes these countries stand out.
Northern European countries with peak values
Traditionally, the front runners are in particular small Member States with comparable fewer citizens. Specifically, the Nordic States Sweden, Finland and Denmark can be found regularly at the top. Further down are often the Southern European as well as the more recent Member States, such as Greece and Bulgaria. The Labour Market Monitor also shows how strongly the financial and economic crisis is reflected in the labour market. Thus, looking at the first dimension, which deals with the overall performance of the labour market, shows that due to the crisis the labour market performance of the EU Member States has strongly diverged. The differences between EU countries are still significantly larger than prior to 2009. Ireland comes off best. Austria is - almost level with Estonia - in the upper mid-field. Even though the situation in Greece has slowly improved since 2014, the country is still at the bottom of the list.
While the first dimension includes many indicators, which not only strongly depend on the economic situation, but are also susceptible to significant changes even within short periods, the remaining four dimensions are more focussed on structural indicators, which only slowly change over time - for example the level of education or the distribution of income.
Austria with mixed results
With an above-average high GDP per capita, Austria is one of the EU’s richest countries. Only three other countries show higher labour productivity; the unemployment rate of adolescents and young adults is comparatively low. Compared to other EU countries, Austria can also score with regard to social security and redistribution by the welfare state and is therefore one of the frontrunners. Even though average incomes overall are relatively high, at 19.9 %, the difference between the average gross income of women and men is as high - we are talking of the EU’s fifth largest gender pay gap. Other weaknesses include the comparatively high taxation of labour as well as the high part-time work rate due to care duties. Regarding the care rate of children under the age of three, Austria is trailing at the end of the table. Only 20 % of children in this age group attend a formal childcare facility, compared to ca. 35 % on EU average. At 4.8 % GDP for public education spending, Austria occupies a place in the lower mid-field. Regarding the health sector, one notices in particular a comparatively high rate of fatal accidents at work and at 56.8 years, a low rate of healthy life years.
With the Labour Market Monitor, the Chamber of Labour, in cooperation with WIFO, has created a descriptive instrument, which is able to depict the labour market in all its complexity clearly and comprehensively. Thus, relevant research issues can be identified and examined in more detail. This is vital if one wants to recognise shortcomings and problematic developments, to be followed by appropriate political (counter) measures. In particular in view of the current crisis and the disastrous impact on the labour market, such an instrument is of utmost importance.