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Technology and the Future of European Employment

Technology and the Future of European Employment

Edited by Pascal Petit and Luc Soete

What is the potential of the new information and communication technologies? This book assesses the relationship between technological change and employment in all its dimensions, focusing on contemporary economies in Europe. The authors discuss patterns of growth, and the type of employment that countries might expect to be created following the introduction of these new technologies.

Chapter 10: Sweeping the chimney before kindling the fire as a workable option for employment policy

Adriaan van Zon, Huub Meijers and Joan Muysken

Subjects: economics and finance, economics of innovation, labour economics, innovation and technology, economics of innovation, innovation policy


10. Sweeping the chimney before kindling the fire as a workable option for employment policy Adriaan van Zon, Huub Meijers and Joan Muysken 1. INTRODUCTION One of the most pressing problems of today is the uneven distribution of the burden of unemployment across different skill groups. Low-skilled workers especially are more often unemployed than others (OECD, 1994). They are also unemployed for longer periods of time (Muysken and Ter Weel, 1997). The unevenness of this distribution seems to indicate that having different skills determines to some extent one’s employment/unemployment opportunities. However, policy prescriptions meant to alleviate the problems associated with the uneven distribution of unemployment are primarily based on (conceptual) models which effectively ignore skill differences between workers. Policy recommendations involving wage flexibility or reductions in costs of hiring and firing, for example, seem to be based on the notion that, essentially, skills are not the distinctive elements in defining the employment opportunities of an individual. Instead, individual skill services, being overpriced or being too costly to hire and/or fire, are often regarded to be the real cause of disparities in unemployment rates by skill. In this chapter we will argue that this neglects the fact that people with high-level skills have intrinsically more employment opportunities than people with low-level skills. This is because low-skilled people may find it (too) hard to fill high-level jobs.1 High-skilled people, on the other hand, may be expected to be able to perform, in principle at least, in both low-level jobs and high-level...

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