2. 2
• Why does job quality matter?
– A key element of individual well-being (i.e. an end in its own right)
– Determines labour force participation, worker commitment and
productivity (i.e. a means to greater economic performance)
• Despite the importance of job quality, it has received limited attention
in the international policy debate
– Assessment of policies and institutions has tended to focus on their
impact on job quantity (e.g. Reassessed Jobs Strategy, Europe 2020)
– Need to assess labour market performance in terms of more and
better jobs
• A major obstacle to giving more prominence to job quality has been the
difficulties of defining and measuring it
– Multi-dimensional nature of job quality
– But also requires addressing many other difficult issues
Job quality, labour market
performance and well-being
3. 3
• Growing momentum with proliferation of initiatives on job quality
and the measurement of well being
– EC (2001), Eurofound, ILO (2012), EMCO (2013), UNECE (2014)
(see Table 1 of the hand-out for an overview)
– Similar trend for quest of going beyond GDP by focusing on well
being (Stiglitz Commission, 2009; OECD How is Life?, 2011)
• Propose a new conceptual and operational framework to measure
and assess job quality in OECD countries
− Focus on worker well-being building on Stiglitz et al.
− Favour actionability over comprehensiveness
− Improve and extend over time
• Provide an overview of job quality across OECD countries and
socio-economic groups
How good is your job?
Measuring and assessing job quality
4. How good is your job?
1. A framework for measuring and
assessing job quality
5. Income
Jobs
Housing
Personal activities
incl. work
Insecurity, economic and
physical
Social connections and
relationships
Subjective well-being
Political voice and governance
Health Health
Education Education
Work-life balance
Civic engagement
Social relationships
Work environment
Personal security Labour market security
Earnings
Material living
conditions
Well-being
OECD
Job quality
OECD
Well-being
Stiglitz, Sen & Fitoussi
6. 6
Assessing economic and labour
market performance
Labour market
security
Quality of the
work environment
Well-being
Labour market performance
Earnings
quality
Employment /
unemployment
Job quantity Job quality
7. 7
• Focus on outcomes experienced by workers
– Consistent with well-being perspective
– Allows evaluating the role of policies and institutions
• Concentrate on individual workers
– To take account of the distribution of job quality outcomes
– Allows assessing to what extent poor outcomes on one
dimensions are associated with poor outcomes on another
• Favours objective features of job quality
– Ensures better comparability of outcomes across countries and
time
Principles for the
measurement of job quality
9. 9
• Life satisfaction increases with the level of earnings
– Holds both across countries as well as between persons within
countries
• For a given level of average earnings, overall well-being
tends to be higher the more equal its distribution
– Life satisfaction rises at a decreasing rate with earnings
(“saturation effect”)
– People tend to display an intrinsic dislike of high inequality in
society (“inequality aversion”)
Earnings and subjective well-being
10. 10
• At the individual level
– Gross versus net: use gross earnings because of data constraints,
net earnings more relevant for well-being
– Frequency: hourly wage not affected by working time (job
quantity )
• At the aggregate level
– Make use of general means framework (Atkinson, 1970)
– Allows giving more weight to the bottom of the distribution,
thereby taking account of both the level and its distribution
– Assume “moderate” degree of inequality aversion (weight of 2/3
on 1st tercile, ¼ on 2nd tercile and remainder on 3rd decile)
Measuring earnings quality
11. 11
Earnings quality across countries
Gross hourly earnings in US dollars, PPPs, 2010
12. How good is your job?
2.1 Earnings quality
2.2 Labour market security
13. 13
Measuring labour market security:
Unemployment risk and insurance
• Existing frameworks typically focus on job security using indirect
proxies such as incidence of temporary or short-tenured workers
• Definition of labour market security effectively assumes that the cost
of unemployment is limited to the associated loss of income
Unemployment risk
- probability of becoming unemployed
- expected duration of unemployment
-> measured using data on unemployment
inflows and outflows
Effective unemployment insurance
- accessibility of benefits
- their generosity and maximum duration
- the progressivity of the tax system
->use OECD benefit-recipiency database
and OECD taxes-benefits models
Expected cost of unemployment
14. 14
Labour market insecurity
in OECD countries
Share of previous earnings, 2010
15. 15
Unemployment risk and insurance have
important implications for well being
Estimated effects of unemployment risk on life satisfaction and the
compensating effects of effective unemployment insurance.
16. How good is your job?
2.1 Earnings quality
2.2 Labour market security
2.3 Quality of the work environment
17. 17
• Depends on balance between job demands which impair health
and job resources which mitigate their effects
• Either use EWCS for 2010 or combine EWCS with ISSP 2005 to
expand coverage to non-European OECD countries
Measuring quality of the working environment:
Job demands, job resources and job strain
Job demands
- time pressure
- physical health risks
- (workplace intimidation)
Job resources
- work autonomy & learning
- good relationships with colleagues
- (good management practices)
Index of job strain
combination of excessive job demands & insufficient resources
that increases risk of health impairment
18. 18
Quality of the working environment
in OECD countries
incidence of job strain, 2005
19. 19
Job strain and work-related health
0
10
20
30
40
50
60
Workers in strained
jobs
Other workers
A. Work reporting that work impairs
health
0
2
4
6
8
10
12
Workers in strained
jobs
Other workers
B. Number of sick leave days
(over the past year)
0
2
4
6
8
10
Workers in strained
jobs
Other workers
C. Workers not at all satisfied with
working conditions
0
10
20
30
40
Workers in strained
jobs
Other workers
D. Workers not at alll satisfied with
work-life balance
20. How good is your job?
3. A statistical portrait of job quality
in OECD countries
21. 21
How does job quality compare
across countries?
22. 22
How do job quality and job quantity
relate across countries?
Country rankings (1-32) from highest to lowest performance
23. 23
• Youth and low-skilled not only tend to have relatively low employment
rates but also weak job quality outcomes
– Education is positively associated with job quality in all three dimensions.
– Age is associated with higher earnings quality and better QWE. Labour market
security is highest for prime-age workers (30-49).
– Women have lower earnings, but have otherwise similar outcomes to men.
• Non-standard work tends to be associated with weaker job quality
outcomes but not necessarily all
– Temporary work is not only negatively associated with earnings quality and
labour market security but also with QWE.
– Part-time work is associated with lower earnings quality (in terms of hourly
wages) and labour market security, while QWE tends to be higher.
Which workers hold quality jobs?
25. 25
• New conceptual and operational framework to measure
based on three broad and complementary dimensions
• Allows for more comprehensive assessment of labour
market performance and the role of policies and institutions
– Fuller assessment effects of policies and institutions
– Reinforce attention to certain areas in debate on labour market
performance (e.g. preventive health systems)
• Actual implementation and measurement flexible and can
be adapted to one’s preferences or the specific context
Concluding remarks
26. 26
• For further information on OECD work on job quality
please contact:
– Sandrine Cazes (STD): sandrine.cazes@oecd.org
– Alexander Hijzen (ELS): alexander.hijzen@oecd.org
Thank you!
