The word "flexicurity" is used to describe a social system combining an easy possibility for the employers of hiring and firing - flexibility - to important social benefits for unemployed people - security. This model is typical for Denmark for different reasons. Welfare benefits are centralised under the state authority represented by one minister that has in charge the employment issue and the social assistance. Moreover, in the Labour market regulation, the state intervenes rarely with legislation. Most of the rules are the product of a consensus between employers and powerful trade unions. The "flexicurity" model consists in on one hand, the free possibility for employers to hire and fire people, following the economic trend, which depends more and more on the international fluctuations, on opportunities offered by new technologies... On the other hand, the state has in charge the unemployed people and provides good conditions to maintain their standard of living but also to incite them to find a new job through training, education, job offers... This concept of "flexicurity" put together three notions that are not used to be coordinated: the Labour legislation, the unemployment benefits system and the employment policy. The objective is to protect people more than jobs. Indeed, the necessity was, after the crisis of the 1970s, to develop new mechanisms of security and social protection that are adapted to new requirements and that permit the society to take advantage of technical progresses and globalisation trend.
[...] The relations between the state and these Labour organisations are based on a voluntary bargaining system that provides a large professional autonomy, for instance a freer incentive for employers to hire without having too heavy charges and strict rules on layoff. The social partners are recognised though the right of association in the constitution. Indeed, both trade-unions and employers recognise each other. That helps to solve the problems on the Labour market by reaching collective agreements. During the period of negotiation, as well as during the period when the agreement applies, there is a peace “obligation”. [...]
[...] The Danish model could also be developed on new incentives, restricted resources and human resources, new opportunities of employment and services to fulfill the new needs of today's society. b. Social cover financed by a tax system The paradox is that Denmark is a country with very heavy taxes and still it is more competitive and has a higher employment rate that many other countries in Europe. Indeed, in this concept, mass unemployment is seen as a threat for public finances and more generally for the welfare state especially on the social and political aspects of the model. [...]
[...] It is clear that the reforms, to be imagined and accepted, must not sacrifice the social model that has been built through Danish history. It reflects a strong commitment from the government on protecting social rights and from the society towards democracy and egalitarianism. During the 19th century, although it was loosing its superpower position in the Northern Europe and on the Baltic Sea, Denmark managed to face industrialisation, modernity and democratic progress for its society. The cities grew, especially with investments in housing and infrastructures in Copenhagen and other main cities. [...]
[...] The typical characteristics for the Danish welfare state political system are a high degree of social equality, a good social security net, a consensus-based relation between political actors and Labour market actors. It contributes to reduce conflicts within the society and to reduce the distance between the population and politicians. It is part of the Danish culture. To sum up, the Danish Labour market has some particularities which create the favourable context to implement the “flexicurity” system: - A densely organised Labour market - Centralised negotiations rounds (with collective agreements) - A consensus-based relation among all actors - A voluntary system with limited regulation via legislation. [...]
[...] This government consequently plays a role in the decrease of the support towards the Danish model consisting in this balance between flexibility and security. It means that the “flexicurity” model in Denmark might have to adapt itself to these new challenges to guarantee the balance and the consensus it could form. As a conclusion, Denmark maintains a large, expensive and universal welfare state but it is also able to finance it through high income tax. The Danish model is very well accepted and it is sustainable, it doesn't weaken the economy. [...]
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