TUAC COMMENT ON JOB TENURE
( Paris, April 26, 2001)
With regard to two decades of globalization in which the risks of volatility
in global markets have increasingly been shifted from capital to labor
there seems to be a common perception that the employment relationship
has become more tenuous, and that the commitment of firms and workers to
each other has become weakened.
Quite often it is argued that the employment relationship in all of
the industrialized countries has been weakened, that permanent, long-term
jobs are threatened, and that nonstandard or atypical work arrangements
- part-time work, temporary jobs or time-limited contracts, and independent
contractor and free lance jobs - are on the rise everywhere.
However, while worker's perceptions their insecurities about their jobs
and their future have increased, there is some ambiguity in the data about
the extent to which the "social contract" between corporations and their
employees has unraveled. A review of recent recent research on the standard
employment relationship in the U.S. as wellas in other countries sorts
out many of these issues. The authors identify standard employment with
internal labor markets.
With respect to the long-term employment relation, they find that job
tenure has declined only mildly overall, as declining job stability for
men has been moderated by the influence of longer tenure for women, who
are less likely today to leave paid employment when they have children.
However, there has been a strong decline in job tenure among young workers,
among those who lack post-secondary education, and among African Americans.
These findings regarding the US are consistent with those of the examination
of job tenure of workers in the U.S., Japan and the European Union in the
1980s and 1990s. The results challenge the popular idea, that the long-term
employment relationship is a thing of the past. According to the study
low average job tenure and declining job stability applies to men in the
U.S., however average job tenure is rising for men and women in Japan.
A broadly stable or rising job tenure for men is to be found in most European
countries as well as low but rising job tenure for women.
At a first glance, the situation of emloyees in high tech jobs, among
them fast growing computer occupations - like computer engineers, computer
support specialists, systems analysts, database administrators, and desktop
publishing specialists, seems tobe in line with the perception of declining
job stability and employment tenure.
ICT manufacturing companies are claiming that the average tenure of
a software engineer is now less than two years. For quite a while most
high tech companies welcomed these development, which minimized their responsibilities
to the high-priced professionals doing the cutting edge work, and who might
not be needed next year. Recently however, the dynamic growth of Internet
applications has led to tight labor markets for high skilled IT professionals,
which are exacerbated by the high turnover and constant job churning of
these workers.
There can be no doubt, the ICT related workforce, comprising hardware
and software engineers, systems analysts, programmers, new media workers
and web designers, includes also a large numbers of highly skilled and
highly paid independent contractors who tend to prefer this way of working.
Moreover, there is also a large number of ICT-workers employed on a temporary
basis. However, most of the temporary workers in the IT-producing industries
are among the least satisfied with their employment relationship. Overwhelmingly,
these are workers who desire strongly regular, full-time jobs and have
accepted temporary placements on what they hope really is a temporary basis.
According to the US BLS the employment tenure of computer equipment
operators has experienced a strong increase from 3.2 years in 1983 to 4.1
years in 1998. However, only in the past two years it droped to 2.9 years.
In interpreting this development one has to take into account that during
periods of economic growth median tenure and the proportion of workers
with long tenure tends to fall because more job opportunities are available
and thus experienced workers have more opportunities to change employers
and take better jobs. However, there seems to be a rather high and stable
employment tenure in place, regarding high skilled jobs and in particular
managers: In the US, managers and professionals had the highest median
years of tenure among the major occupational groups, while workers in service
occupa- tions had the lowest median tenure.
US: Median tenure little changed in recent years
The median number of years that wage and salary workers had been with
their current employer (referred to as employee tenure) was 3.5 years in
February 2000, about the same as in February 1998.
Although the median years of tenure has been consistently higher for
men than for women, the gap has narrowed since the early 1990s. For men,
median tenure in February 2000 was unchanged from February 1998. It was,
however, slightly lower than in January 1983, despite an upward shift in
the age of the male workforce.
For women, the median years of tenure were slightly higher in February
2000, and there also was an upward shift in the age of the female workforce
from 1983 to 2000.