According to Istat data, in the last few months of 2008 employment stopped growing in Italy. The trend in growth of labour supply from the fourth quarter 2007 to the fourth quarter of 2008 was virtually nonexistent, i.e. it was only 0.1% higher, while the increase in employment in the last quarter of 2007 compared to the same quarter of the previous year was over 1%. Thanks to the performance of the labour market in the first months of the year the annual average for 2008 still shows a 0.8% increase in the number of employed: almost 183,000 more than in 2007. This overall result reflects the continuing good conditions in North and Central Italy, where a large contribution is given by the growing number of foreign workers, and the critical conditions of Southern Italy with its loss of over 34,000 workers, down 0.5% compared to 2007. The troubles of the South emerge ever more clearly if the severe contraction in the year to the fourth quarter of 2008 is taken into account. The contraction of nearly 2% mainly concerns male workers in agriculture and industry.
In Veneto conditions are better. The number of employed people grew in all quarters of 2008. Consequently, the average increase in employment was nearly 2% compared to the previous year. There were over 40,000 workers more than in 2007, mainly in the sectors of industry and services, a significant number if we consider that it accounts for 22% of all newly employed people in Italy. As a result, the Italian employment rate did not change compared to 2007 as it was still 58.7%, significantly below the Lisbon strategy target of 70% employment for the European Union in 2010.
Italy suffers for the difficult situation in the South where its regions encounter increasing problems. Figures for Calabria, Campania and Sicilia in particular are increasingly gloomy since their employment has plunged once again to worryingly low levels. Conversely, Veneto has employment levels that are constantly higher than the national average: in 2008 the employed population aged 15 to 64 years was 66.4%, up 0.6% compared to 2007 and higher than in EU27 (65.9%).
Compared to other Italian regions Veneto still ranks high-fifth-in employment levels, just four percentage points below Emilia Romagna, which is first in the league and the only Italian region to meet the EU target, with 70.2% employment. Veneto is still in the group of regions with the highest employment level together with quite strong, sustained growth. If their high employment levels in the last few years are taken into account, Emilia Romagna and Valle d'Aosta are also part of this group, though their employment rates are going down.
An analysis of Italian quarterly data, which give a fair idea of trends in the labour market, shows that the number of male workers has sharply decreased while female workers exhibit a countercyclical trend and have increased significantly. If trend data in the last quarter of 2007 and 2008 are compared, a decrease in male employment is found-nearly 88,000 workers, equal to 1% in the employment rate. The number of employed women, however, has increased by 111,000 units, up 1%, and accounting for 0.3% in the employment rate. Over the same period the female employment rate only decreased in Southern Italy, where female employment levels are already quite low: 31.3% in the fourth quarter 2008.
As an economically strong region, Veneto differs from the rest of the country. Compared to the last quarter of 2007, in the same quarter of 2008 participation in the labour market improved both for women and for men, though slightly less so for the latter: female employment grew 2.7%, male employment 0.6%. In the last quarter of 2008, the ratio of working women aged 15 to 64 was 56%, almost one percentage point more than the previous year, but still below the EU target set in Lisbon in 2000 of an average female employment rate of 60% by 2010. Among the regions that have reached the target are Emilia Romagna, with a rate of almost 63% in the last few months of 2008, Valle d'Aosta with 60.7%, and Trentino Alto Adige with nearly 60%. (Figure 5.1.1)
In short, in 2008 the average rate of employed women aged 15 to 64 in Veneto was 55.5%, 1.5% above the figure for 2007 and more than 8% higher than the national average. In all the southern regions women's participation in the labour market was lower than the national average and in many the figure was not even half of what it was in Emilia Romagna (62.1%).
Female employment in the entrepreneurial world-one of the priorities in the European Pact for Gender Equality dated March 2006-has been growing. In the last four years women entrepreneurs have increased by almost 4% in Veneto, by about 5% in Italy, numbering more than 191,000 in 2008. Compared to other Italian regions, however, it should be pointed out that although Veneto ranks among the first ones for ratio of the national total (8.8%), there are not many women entrepreneurs in the region: Veneto ranks 17 among Italian regions by percentage on the regional total. In Veneto women who decide to become self-employed are 25.4% of the total number of registered entrepreneurs, 0.4% above the 2004 figure, but still well below Molise, the first-ranking region with over 7%. (Figure 5.1.2)
As proof of the growing number of foreigners in the labour force in Veneto, the percentage of immigrant women entrepreneurs has also increased, more than at national level. Compared to 2004, in 2008 there was over 43% more self-employed foreign women in Veneto and overall almost 40% more in Italy. In line with the average at national level, in 2008 women entrepreneurs worked mainly in trade (23.6%), real estate (18.6%), followed by manufacturing (16.5%) and agriculture (13%). (Figure 5.1.3)
While employment stalled, the state of emergency became clear as unemployment spread in Italy. In the past households were mainly worried about the cost of living, the quality of services and crime, now a lack of work is their main fear. After nine consecutive years of shrinking unemployment levels, in 2008 unemployment started growing again to reach 6.7%, over 0.5% more than the previous year. On the other hand, last year people already wondered whether the constant decrease concealed a degree of inertia on the part of working-age people who were not confident they could find a job, especially in the southern regions.
European statistics, too, show that labour market conditions have worsened. Although in the last few years the unemployment rate of EU27 had shown significant improvement, in 2008 it slowed to a standstill and settled at 7%, only 0.1% below the 2007 rate. A major factor was the situation in Spain, where unemployment rose sharply from 8.3% in 2007 to 11.3% in 2008, basically as a consequence of the housing bubble bursting and the ensuing construction crisis. This increase was even higher than in the US where the rate rose to 5.8% compared to 4.6% in the previous year.
Even though the number of employed people grew in Veneto, though not as much as it did in Italy, people looking for jobs are still on the increase: 8.2% more than the previous year compared to 12.3% overall in Italy. The unemployment rate rose in Veneto, though being 3.5% and up from 3.3% in 2007 it was still quite good among Italian regions as it ranked fourth in the regional classification. Ahead of Veneto were only Trentino Alto Adige with 2.8%, Emilia Romagna with 3.2%, and Valle d'Aosta with 3.3%. (Figure 5.1.4)
The labour-market crisis at the end of 2008 is also proven by the increase in redundancies, the consequent inclusion of workers in mobility lists, and the surge in the hours paid out of Wage Guarantee Funds.
Redundancies and the consequent inclusion in mobility lists have also increased significantly. After the slowdown in 2006-2007, in Veneto over 19,600 workers were made redundant and included in the mobility lists in 2008, more than twice as many as eight years before.
While in the early 1990s the number of people put in the mobility lists in Veneto mainly concerned employed people who were made collectively redundant, in accordance with Law no. 223/91 (Note 4)
, and had already received mobility allowances, since 1995, but especially in the last few years, individual redundancies by small-sized enterprises have had a major impact on the overall total. This means that people who are included in a mobility list in accordance with Law no. 236/93 enable companies to get tax exemptions if they employ workers, but not mobility allowance. In 2008 12,800 workers were affected by individual redundancies and thus only received unemployment allowance; this was 65% of the total number of people included in the mobility lists. There were 6,870 people made collectively redundant. Moreover, compared to the previous year, inclusion in the lists as a result of individual redundancies went up by 45%, while inclusion as a result of collective redundancy increased by 11.5%.
In 2008 Treviso was the province with the highest number of people affected by individual redundancies, over 2,700, while Vicenza ranks first for redundancies as a result of collective redundancies with almost 1,760. (Figure 5.1.5)
The hardest hit people
Regarding the inclusion in mobility lists further to collective redundancy, in 2008 the hardest hit sector in Veneto was again the textiles and clothing industry, which accounts for 18% of the total inclusions, while regarding individual redundancies, the construction and trade sectors were the hardest hit with 17.3% and 15.7% of the total respectively. In general, collective redundancies were mainly in the manufacturing industry (77% in the last year), while individual redundancies decreased in the manufacturing industry and increased in the construction industry.
If Italian citizens in Veneto are considered with reference to Law no. 236/93, the higher number of inclusions in the mobility lists concerns women, even though in the last few years the number of women has decreased as more and more men were made redundant in small-sized enterprises because the growing number of inclusions shifted from the fashion to the construction industry.
The inclusion in mobility lists of foreign workers is also clear. Foreign citizens accounted for 15% of collective redundancies and 24% of individual ones in 2008. This has affected more male foreigners whose share in individual redundancies went up from 4.4% in 2001 to as much as 19% in 2008, so that the male share, whether foreign or national, in redundancies was higher than the female one in the last year.
The crisis in the last few months
A monthly analysis shows that the increase in redundancies-especially in small-sized Veneto companies- started in 2008 and continued in 2009. In four months, from November 2008 to March 2009, the total number of inclusions in mobility lists went up 62%. Last March, 2,500 people were included as a consequence of individual redundancies, twice the figure in March 2008. Overall 769 workers were included as a result of collective redundancies, about 5% more than in March 2008. (Figure 5.1.6)
Compared to the overall situation in 2008, in the first quarter of 2009, with reference to collective redundancies, the situation continues to grow worse in the textiles and clothing industry, which accounted for over 22% of total inclusions in mobility lists, though it was not as bad as in the metal industry, which accounted for 23% of the total, up from 8.6% in 2008. As for individual redundancies, it is clear that the construction industry and trade are experiencing difficulty as they accounted for 17.4% and 14.7% of total inclusions respectively. (Figure 5.1.7)
The boom of the Wage Guarantee Fund (WGF)
Recourse to the Wage Guarantee Fund has increased as it allows companies to overcome difficulty by temporarily laying off workers. In 2008 in Italy the Wage Guarantee Fund (WGF) covered 223 million working hours, (Note 5)
, up 25% from the previous year, but slightly less than in 2005 and 2006, and still much lower than the figures relating to the 1993 crisis-about 550 million.
The increase in hours covered by the ordinary Wage Guarantee Fund, which is more closely linked to the business cycle, were 60.4% more than in 2007, while special one, to do with crises and company restructuring, has remained on the same levels as 2007.
In Veneto wide use was made of the Wage Guarantee Fund in 2008. Overall 15.5 million working hours were covered, nearly 45% more than in the previous year. Compared to the national level, the number of hours covered by the special Wage Guarantee Fund was higher than those covered by the ordinary one, 56% of the total. However, the highest increase concerns the ordinary Wage Guarantee Fund, up 72.2% compared to 2007, while the special one rose by 28.6%. In Veneto the Wage Guarantee Fund accounted for 7% of the national total: 6% for the ordinary Wage Guarantee Fund and 8% for the special one, up 1% from 2007. (Figure 5.1.8)
As opposed to the rest of Italy, in Veneto it is the white-collar workers-the quintessential middle class-that suffered most. The number of their hours covered by the WGF more than doubled in 2007, while in Italy the increase was 14.3%. The number of hours covered by the WGF was up 38.4% for Veneto's manual labourers and 26.4% for Italian ones. When it comes to hitting workers, the depression does not seem to make much of a distinction between white- and blue-collar, nor between young and old.
If the number of hours covered by the Wage Guarantee Fund is translated into number of workers by assuming that each person works 1650 hours a year, (Note 6)
, in 2008 in Italy the Wage Guarantee Fund covered the equivalent in hours of 135,000 workers: over 26,000 more than in 2007. The region with the highest number of hours covered by the Wage Guarantee Fund is Lombardia with 20.7% of the total, or nearly 28,000 workers in 2008. Piemonte and Campania follow with 16% and 10.4% respectively at national level. Veneto is fourth; here the Wage Guarantee Fund covered the equivalent in hours of over 9,400 workers compared to approximately 6,500 in 2007. (Figure 5.1.9)
The crisis by sector
In line with the national average, in Veneto the worst hit sectors are the mechanical, fashion, i.e. textiles, clothing and leather, and construction sectors. In 2008 the number of hours covered by the Wage Guarantee Fund in these three sectors accounted for 43.5%, 18.4% and 15.5% respectively out of the Veneto total. Compared to 2007, the mechanical industry doubled its requirement of hours while in the construction industry it went up by over one third. In the fashion sector a distinction is made between the surge in the leather industry, where the hours covered by the Wage Guarantee Fund were two-thirds more than in 2007, and a decrease in the textiles and clothing sectors. The data differ from the national ones as in Italy the number of hours grew in all three fashion sectors under consideration. A major source of concern is the transport and communications sector as it shows a huge increase on the previous year, though the number of hours covered by the Wage Guarantee Fund was less than 3% of the total.
The surge in early 2008
The year 2008 ended on a low with major use of the Wage Guarantee Fund, and 2009 started with just as many problems. INPS data show a constant increase in the hours covered by the Wage Guarantee Fund in early 2009 too. In March 2009 in Italy the hours covered by the Wage Guarantee Fund were nearly 59 million, 38.2% more than in February and almost four times more than a year before. In Veneto the number of hours was slightly lower than 3.5 million: 44.5% more than in February and almost twice as much as in March 2008. The increase in the region is only due to the rise in hours covered by the ordinary Wage Guarantee Fund which, as stated above, is more closely linked to the business cycle and is granted when the crisis of the company is due to temporary events and production is expected to recover. This is a mildly comforting sign because it implies that the companies' assessment is not too negative. Compared to March 2008 the ordinary Wage Guarantee Fund rose by 546% while the special one, which is linked to crises and to restructuring, decreased by 66%. Moreover, the increase, whether in the ordinary or special Wage Guarantee Fund, was not as sharp between February and March as it was between the first two months of the year. (Figure 5.1.10)
A sum of data for the first quarter of 2009 shows that in Veneto the sectors affecting the regional total most were first the mechanical industry with 41.4%, second the construction industry with 18.7%, and third the fashion sector with 15.9%. Compared to February, the last month taken into account, the situation was different from the national average as in Italy all sectors showed greater recourse to the Wage Guarantee Fund, while in Veneto there was a marked decrease in the hours it covered in the fashion sector.
Finally, still considering an average number of working hours of 1650, we can estimate that 24,500 Veneto workers were covered by a Wage Guarantee Fund in March 2009, up from 13,000 in 2008; there were almost 124,000 in Lombardia and about 95,000 in Piemonte, the regions with the highest number of hours; in Italy there were 427,000 workers on a Wage Guarantee Fund overall, which is almost four times as much as in March 2008.