The First Part-TIME Economy in the World
Does it Work?
1 IntroduCtion
In his Adam Smith lecture of the European Association of Labour Economists, Harvard
economist Richard Freeman has defined the Netherlands as ‘the only part-time economy of
the world, with a finger in the dike of unemployment’ (Freeman 1998: 2). How did it
happen? What kind of jobs are these and whose jobs are they? Can a ‘one-and-a-half job’
model work? Is it a solution to Europe’s predicament of unemployment? These are the
questions that I will try to answer in this paper.
The paper begins with a brief description of the main changes in the Dutch labour market
during the past decades. It shows that there was a major reversal of trends on nearly all
performance indicators in the early 1980s. Next, I discuss the role of wage moderation,
sectoral change and job redistribution. In section three I shall focus in particular on the role
of atypical and part-time employment. Section four concentrates on policies and changes in
labour market behaviour and preferences, in particular of (married) women, trade unions,
employers and governments. In the concluding part I shall identify some problems
associated with the one-and-a-half job model and try to answer the central evaluative
questions and title of the paper.
2 The tranSformation of the DutCh labour market
Fifteen years ago, the Dutch labour market was in a very depressed state. Nearly 600,000
people, more than ten per cent of the labour force (800,000 or thirteen per cent according to
the old definition) were unemployed. (The new definition follows ILO-standards and
requires the unemployed to be available to take the job within the reference period. About
one-third of the unemployed according to the old definition were not available or ill
prepared to take a job within short notice. This indicated, if nothing else, a severe problem
of ‘inactivity’ in the Dutch labour market). An almost similar proportion had left
employment due to illness, disability or early retirement in advance of the legal retirement
age of 65. One of every four non-school going youth under the age of 25 was unable to find
a job. The employment/population ratio of the Netherlands had dropped under fifty per cent
and was one of the lowest in Europe.
The first half of the 1980s was the culmination of a decade of stagnation of employment
(see Table 1). It was also a turning point. Looking back from the perspective of today, we
observe a reversal of trends in nearly every aspect. Labour participation has increased again,
among all age groups, though least among older workers and most among women between
25 and 49 years. The average rate of job growth during the past decade and a half was 1.8
per cent per year, accelerating to 2.2 per cent in 1997 and 1998. This is no less impressive
than the American ‘jobs machine’ and many times better than the European average (0.4%)
during the same period. Many of these jobs are part-time jobs and the annual working time
of full-time workers has fallen by 0.3 per cent per year since 1984 (less than half the rate
during the previous period). Hence, if employment is expressed in full-time equivalents or
hours worked rather than jobs or persons, employment growth is lower. (Note that full-time
equivalents or ‘labour years’ have become shorter with the annual reduction of working
hours of full-time workers). If labour input is the variable of interest, than labour volume or
hours worked is the appropriate measure (see Table 1).