Labour Administration in Uncertain Times

Labour Administration in Uncertain Times

Policy, Practice and Institutions

Edited by Jason Heyes and Ludek Rychly

The 2008 financial crisis marked the beginning of a prolonged and ongoing period of extreme economic turbulence that has created multiple challenges for both governments and national systems of labour administration. Difficult economic conditions are encouraging a reevaluation of established policies and institutions in the areas of labour, employment, social protection and industrial relations. This book analyses recent reforms in labour administration and national labour policies, charting their development and discussing the challenges and opportunities faced by governments, ministries of labour, labour inspectors, employer organisations and trade unions.

Chapter 4: Labour regulation and the economic crisis in Europe: challenges, responses and prospects

Nicola Countouris and Mark Freedland

Subjects: economics and finance, labour economics, social policy and sociology, labour policy


Britain has a deficit crisis, from which the only escape route is economic growth. Growth needs to be encouraged in every way possible. Businesses must be able to manage their affairs in a way that allows them to become more efficient, more competitive on a domestic and global basis and hence more likely to grow and employ more people. Yet much of employment law and regulation impedes the search for efficiency and competitiveness. (Bee- croft, 2011) We have weakened our automatic stabilizers by weakening social protection, and we have destabilized the economy by making wages more flexible rather than providing job security. We have created greater anxiety, which, in times like this, increases savings rates and weakens consumption. All of these so-called reforms have made our economic system less stable and less able to weather a storm. (Stiglitz, 2009: 11) The purpose of this chapter is threefold. First, it sets out to analyse a series of ad hoc national and supranational regulatory responses in the field of labour regulation to the challenges produced by the financial crisis that erupted in early 2008, and the ensuing economic downturn. Second, it identifies and presents a series of more structural reform proposals that, in more recent and no less troubled times, have been advanced as offering more radical and structural solutions to at least some of the perceived challenges faced by twenty-first-century labour markets. Third, it seeks to put forward a sceptical argument about the relationship between labour law, labour market performance and – broadly speaking – economic performance.

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