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February 20, 2018

An increasing number of Italian workers are in temporary jobs

An increasing number of Italian workers are in temporary jobs

As Italy goes to the polls in March, one key issue for the future government is increasing the number of stable, permanent jobs available.

“The Italian labor market is undergoing a moderate recovery that could be aided by policy interventions aimed at increasing efficiency and competitiveness,” write Francesca Marino and Luca Nunziata in their analysis of Italy’s labor market.

“Real earnings have been increasing, but productivity is stable at relatively low levels compared to other European countries.”

The number of people in employment is at a record high and in November unemployment fell to its lowest in five years. About 1.1 million more Italians are employed compared to when the country launched the latest overhaul of its labor market in March 2015 by offering benefits for open-ended contracts. But, according to Bloomberg, six out of 10 of those are fixed-term jobs.

Opposition parties have increased their criticism of job quality as campaigning ramps up to Italy’s general election on March 4. Former Premier Silvio Berlusconi, leader of the center-right bloc of parties, called for a review of the labor code, citing the number of temporary jobs.

Similar calls have been made by the Five Star Movement, which is the strongest single party in all voting-intention surveys, adding pressure on the ruling Democratic Party.

As in many other European countries, the Italian government has tried to reduce fixed-term contracts, but they have continued to grow.

The effect of an introduction of fixed-term contracts on unemployment is ambiguous.

“There is some evidence that fixed-term jobs can be a better alternative to unemployment, so that at least the first hurdle—from unemployment to paid work—can be overcome,” writes Werner Eichhorst in his article Fixed-term contracts.

“However, a liberalization of fixed-term contracts in countries where the level of dismissal protections and other labor market regulations remains unchanged runs a high risk of creating a dual labor market. In such a regime, many fixed-term workers, in particular the young, are trapped in a secondary segment of flexible jobs.”

For a complete picture of Italy’s labor market issues, read our country labor market overview.