Analysis of the third European survey on working conditions with composite indicators

Abstract

A composite indicator Working conditions for comparing European countries is constructed from data of the Third European Survey on Working Conditions. The main findings are as follows: (a) European countries differ with respect to working conditions statistically more significantly than with respect to earnings; it implies a quite accurate discrimination threshold in ranking countries with respect to working conditions, (b) working conditions and earnings positively correlate over the whole of Europe but correlate little within single countries; it indicates at the prevailing role of national determinants over professional or social specificities as contributing to the average working conditions, and (c) earnings play no essential role in subjective estimations, including job satisfaction, which mainly depends on working conditions; consequently, more attention should be paid to improving the latter.

The same approach is applied to constructing a three-dimensional indicator of Working time, reflecting its aspects duration, location (abnormality), and flexibility. It is found that abnormality and flexibility compensate each other, whereas the duration is not affected by two other factors.

Introduction

In the new list an indicator quality of work has been added in response to the emphasis put on this issue by the Stockholm European Council. The particular indicator on accidents at work has been chosen … But other indicators of quality of work, such as “life-long learning”, were already included in the list of structural indicators.

• European Communities

• Structural indicators, p. 6

• Brussels, 30.10.2001

• COM(2001) 619 final

The concept of the European welfare state includes both economic and social aspects; see Esping-Andersern (1990). Since employees spend at least 1/3 of the time at work, more than devoted to family, friends, and leisure together (Hesse and Schrader, 1995, Halama, 1997), working conditions play as important a role as income, consumption, or living standards in the total welfare of workers.

Working conditions permanently remain in the focus of attention of the European Commission, national governments, and trade unions. In particular, it is one of the issues of the European Employment Strategy (EES) launched in 1997 in Luxembourg; see European Commission, 2002a, European Commission, 2003. The EU Lisbon Summit 2000 called for “ more and better jobs and greater social cohesion by 2010” (European Commission, 2001a). Four years later, on March 2004, the European Council again emphasized “the urgency to take effective action in creating more and better jobs” (European Commission, 2004).

At the European level, the supervision of working conditions is institutionalized in the European Foundation for the Improvement of Living and Working Conditions, Dublin, and the European Agency for Safety and Health at Work, Bilbao. The former is a European organization, one of the first to be established to work in specialized areas of EU policy. It was set up by the European Council (Council Regulation EEC No. 1365/75 of 26 May 1975) to organize research and development projects, providing data and analysis for the relevant EU policies. The Foundation has a network of experts throughout Europe who conduct research on its behalf including assessing the current national situations, the preparation of case studies and national reports and the conducting of surveys; see European Foundation (2004).

The European Agency closely collaborates with the European Foundation. It acts as a catalyst for developing, collecting, analyzing and disseminating information that improves the state of occupational safety and health. The Agency is a tripartite European Union organization also set up by the European Council (Council Regulation EEC No. 2062/94) to bring together representatives from three key decision-making groups in each of the EUs Member States—governments, employers and workers associations; see European Agency (2004).

Germany has contributed to these European initiatives as early as in the 1970s by a research program Humanisierung des Arbeitslebens (HdA) (= Humanization of Working Life) followed by programs Arbeit und Technik (= Work and Techniques), and Innovative Arbeitsgestaltung (= Innovative Work Structuring); see the Editorial (2004) to Arbeit, 2004/3. The actual program of this type, Initiative Neue Qualität der Arbeit (INQA) (= Initiative New Quality of Work) (Bundesministerium, 2004), is complemented with the political initiative Gute Arbeit (= Good Work) of the leading German trade union IG Metall; see Pickshaus and Urban (2004); for the current German debate on the quality of work see Peters and Schmitthenner (2003).

Both European Foundation and European Agency use statistical data on working conditions from the Eurostat (2004). Macro-data are available from the New Cronos Internet page (section Population and Social Conditions). Selected data are annually summarized in the Labour Force Surveys and other Eurostat reports, also available on-line. These data are however not comprehensive enough for specialized studies on working conditions, and in 1990 the European Foundation initiated purpose-oriented European Surveys on Working Conditions which take place every five years, the third dating 2000 and the fourth being planned for 2005.

The most recent published survey by the European Foundation (2001) is based on a questionnaire with over 200 questions related to

• occupation (position, industry branch, type of contract, size of enterprize, etc.),

• physical environment (vibrations, noise, painful positions, etc.),

• time (evening, weekend, and shift-work, schedule of working time, etc.),

• organizational issues (monotonicity of work, unforeseen tasks, independence and subordination, etc.),

• social climate (possibility to discuss working conditions, cases of violence, discrimination, etc.),

• health (different professional diseases, accidents, sick leaves, etc.), and

• income (basic, bonus, sharing profits, compensations for overtime, etc.).

In total 21,703 persons from 15 European countries were interviewed by national institutes listed in p. 67 of the report. Each country was represented by ca. 1500 interviews, except for Luxembourg with 502 interviews. The interviewed persons were selected by the method of random walk (p. 1 of the report). That is, the European figures were derived from the national averages accounted with weights proportional to the size of active population in the given country according to the Labour Force Survey of Eurostat (1997), ranging from 0.17 Mio in Luxembourg to 35.30 Mio in Germany; see pp. 1–3 and 67–68 of the report.

Thus, the interviews were aggregated in the population dimension (= vertical dimension of the survey data). Thereby the report provides a comprehensive outlook at single countries and the whole of Europe with respect to all the questionnaire items. For instance, one can find the percentage of employees working with computers at least 1/4 of the time or all the time (p. 8), or the percentage of fixed-termed employees or even trainees who dare to discuss their working conditions at their workplace (p. 26). It enables tracing the evolution of the corresponding European and national indicators since the first survey of 1990.

The surveys exhaustively represent a large number of aspects of working conditions but avoid to evaluate them in ‘worse–better’ terms. In several cases such an evaluation follows from questions by default, like from the ones about disturbing factors (noise, vibration, etc.) but in other cases it appears to be quite ambiguous. For instance, one can learn almost everything about the variability of working hours and spontaneity of changes of the working time (pp. 23–25), but nothing is said on whether time flexibility is desirable, or evening work is voluntary, or overtime is fairly rewarded.

Neither countries, nor industrial branches are classified with respect to the quality of work in general or with respect to any partial composite factor like scheduling working time, physical environment, or social climate. It stems from the lack of inter-question aggregation of interviews (= in the horizontal dimension of the survey data) which could integrate answers to all or selected questions. For instance, there are over 20 questions on professional diseases but no integral characterization of health at work.

Another survey-based dedicated report Working Time Preferences in Sixteen European Countries by the European Foundation (2002) also suggests no horizontal aggregation of answers. At most the answers on factual and preferable situations are compared. For instance, answers like “I work 19 hours a week but would prefer to work 21 hours” are processed to obtain conclusions like “50% employees would prefer to work fewer hours, 11% would like to work more, and the rest 38% are satisfied” (p. 43, Table 16). The only occasional step towards horizontally aggregating interview answers is made in pp. 62–79, and 158. The desired increment/decrement in working time is explained with a regression model in variables ‘managerial duties’, ‘blue/white collar’, ‘small child’, etc. The regression coefficients, specifying substitution rates of the variables, allow to bind partial preferences together and thereby to horizontally aggregate interview answers. Regretfully, this possibility is not elaborated and the model is only used for finding most decisive preference factors.

The necessity of synthetic indices for working conditions has been emphasized in the report by European Foundation (1997) where a heuristic approach to their estimation has been outlined, however, with no mathematical model, or specific examples. In spite of vast information provided by the surveys it is still hard to judge which countries offer better working conditions, or which social groups are privileged. If a young European asks himself “In which country would I like to work?” the surveys mentioned will be of little help. Even an expert can have difficulties in finding the countries with most favorable/most critical working conditions.

Taking into account the EU’s aiming at “better jobs” and that policy making operates with aggregated data, a “worse–better” integral evaluation of working conditions is quite urgent. Therefore, developing methods for evaluating survey data can contribute to designing instruments for pursuing the EU policy. It certainly does not diminish the role of partial indicators which highlight specific differentials, and both approaches should be regarded as complementary.

Section 2, “Composite indicators”, introduces the notion of composite indicator and suggests a link between composite indicators and objective functions.

Section 3, “Empirical implementation”, outlines the data structure used in the model and stages of data processing.

Section 4, “Policy monitoring: Benchmarking countries and social groups”, presents the results of country evaluation with respect to working conditions, as well as of selected social groups, together with the statistical significance of the disparities among European countries.

Section 5, “Interaction between working conditions, earnings and subjective estimations”, investigates the interdependence of three aspects of quality of work. The conclusion is that working conditions play the decisive role in job satisfaction.

Section 6, “Interaction between duration, location, and flexibility of working time”, gives a sample analysis of working conditions which cannot be characterized in better–worse terms, in the given case between three aspects of working time. The conclusion is that neither abnormality, nor flexibility of working time are compensated by shorter hours. A compensation is observed only between their abnormality and flexibility.

Section 7, “Methodological discussion”, contains reservations and remarks on the implementation of the indicator of working conditions.

Section 8, “Conclusions”, recapitulates the main statements of the paper with the emphasis at political implications.

Section 9, “Annex 1: Constructing the composite indicator of working conditions”, describes the mathematical model for processing the survey data. In particular, it contains a theorem on recoding calibrated answers of respondents (rounded to a few grades), analysis of independence of questions, and computational formulas.

Section 10, “Annex 2: Main table”, illustrates the data structure used in the model in some detail.