Some components of a two-tiered labour market support structure

This book seeks to explain the variation in the extent to which Greece, Ireland, and Portugal embraced a high-wage, high-skill, ‘knowledge-based’ development strategy for the twenty-first century between 1990 and 2008 by analysing their responses to a series of labour market challenges, namely in the fields of family, higher education, and immigration policy. As the discussion so far has demonstrated, the state’s role in shaping labour market outcomes - specifically, the skills-level and adaptability of the workforce - is also central to the idea of the knowledge economy. Policies aimed at reconciling family and working life along with higher education and immigration policies form what can be referred to as a secondary tier of a labour market support structure (see Figure 2.1). While very interesting in themselves, this research does not focus on what are classically referred to as active labour market programmes, which aim squarely at easing citizens from labour market inactivity to activity, and are usually administered directly by departments or ministries of labour or employment. Although these programmes are extremely important to labour market outcomes,

A two-tiered labour market support structure

Figure 2.1 A two-tiered labour market support structure.

the policy areas selected here, as part of the outer ring of a labour market support structure, are more important for the purposes of this research project because they involve the interests of a diverse array of political actors and interests, not always related to labour market concerns. While the agencies responsible for the formation of family, higher education and training, and immigration policies often do take labour market issues into consideration, they must also often balance these against other and sometimes competing economic and social goals.

Three additional main criteria have led to the selection of these particular three policy areas. First, explaining variation means that policy areas must be selected over which these countries can and do have a range of policy options, especially since this particular group of countries is not only subject to international pressures for policy convergence but is also subject to the forces of Europeanization. European integration means that there are some policy arenas over which member states do not have a great deal of choice, and the regional body’s influence may be either direct or indirect across the policy spectrum. It would not be terribly interesting or theoretically useful to thus select policy areas over which Greece, Ireland, and Portugal appear relatively uniform simply by virtue of their membership of the EU. Agriculture and fisheries are still extremely important industries for Greece, Ireland, and Portugal, for example, but EU member states have very little flexibility over these policy areas. Family policy, higher education, and immigration policies, on the other hand, are still primarily the responsibility of individual member nations, even if the EU occasionally shows interest in ‘harmonizing’ aspects of immigration policy in particular (Givens and Luedtke, 2004; Gubbay, 1999). Aspects of family and education policy are influenced but not determined by such EU activity as the regulation of working time; efforts to forge regional-level social bargaining that include the negotiation of anything from work-based childcare programmes to ‘education for life’ strategies for the purposes of retraining workers in a changing economy; and formal frameworks for social inclusion.

Second, looking ahead to the explanatory framework outlined in Chapter 3, the policy areas need to be important or central enough to be able to reflect something general about the nature of state-society relations, reflected in the development of incorporative and consultative institutions in each of the three countries under consideration. Policy areas that are not very important and in which there appears to be little societal interest will be especially subject to discretionary funding or the personal whims of individual policy makers, limiting their ability to reflect general patterns of state action across the case studies. As discussed further in the following chapter, the research project on which this book is based has been partly influenced by previous work that looks at the role of the state in promoting specific development strategies, and the patterns of state-society relations associated with the ‘developmental’ role of modern capitalist states. However, studies in this field tend to focus almost entirely on industrial policy as a key area for promoting economic growth (Evans, 1995). Yet industrial policy itself is often only one important element of state projects that seek to reorient economic development in a changing global political economy. Thus, this book differs from most work in comparative political economy that focuses on either industrial policy (the state’s direct or indirect role in promoting specific types of economic development) or the state’s management of the relationship between organized business and labour.

Third and related, studies that look at the role of the state and broad patterns of state-society relations in order to explain national choices between development strategies centre almost exclusively on the relationship between the state and organized labour and business. By contrast, this book makes a deliberate effort to examine the state’s relationship with a broader range of groups. Is there something common or general in the way that the state deals with different types of interest groups, or are some groups obviously privileged (or excluded) over others? Some of the groups that are important to the development of family policy include business and labour unions, but the relationship between the state and women’s lobby groups, childcare workers, and established churches, for example, are also important to analyse. In the field of higher education policy, clearly defined interest groups include student unions, university administrations, and private educational establishments. The views and interests of immigrant rights organizations and existing ethnic communities, alongside organized labour and business, are obviously important for states to take into account when designing the legal framework governing immigration.

The decision to concentrate on three policy areas across three countries, delivering a sample of nine case studies, is conditioned by the need to balance issues of manageability where qualitative methods are adopted, as is done here, against the need to increase the number of cases where possible, especially in order to increase the level of variation on the dependent variable (Geddes, 1990; King et al., 1994: 208-30). Since this type of research is necessarily carried out using qualitative data such as interviews, published and unpublished policy recommendations, and legislation, students of comparative political economy are usually prompted to limit their selection of cases to a small number of countries, or an extremely limited number of policy issues, or both. Quantitative data is generally much more useful for measuring policy outcomes rather than how and why policy was actually made. However, the sample has been increased to as many as nine distinct cases so that general patterns of similarity can be observed within countries at the same time as patterns of difference between the three countries can be identified. The choice of policy areas, however, was not guided by a belief that that these three policy areas are necessarily the most important influences on labour market outcomes, let alone the most crucial elements of an overall successful economic strategy. Rather, together they act as a good lens through which to assess general claims about the importance of policy-making processes and institutions that are capable of balancing functions of consultation and incorporation.

34 Labour market challenges

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