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Reviewing the persistence of high levels of unemployment in the EU, finds that this has been accompanied by an increasing incidence of low pay and the adoption of “atypical” employment contracts. The policy response, drawing on the experience of the US economy, has been to advocate the creation of flexible labour markets. It suggests that it is not possible to account for the deterioration in the European labour market in terms of an increase in the supply of labour. The fall in demand for labour is examined in terms of long‐run structural changes and in particular it draws attention to the impact of increased import penetration. Finally it discusses the consequences for public funding of welfare, investment in education and training, and the emergence of a permanent labour surplus economy.
International Journal of Manpower – Emerald Publishing
Published: Aug 1, 1998
Keywords: Education; Europe; Labour market; Low pay; Training; Unemployment; Welfare
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