Ageing And Employment Policies: Italy (Ageing and Employment by Organisation for Economic Co-Operation and Development

By Organisation for Economic Co-Operation and Development

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Chapter 2 examines in more detail the current labour market situation of older workers and identifies some of the key problems that they are facing. The next three chapters explain how the current situation can be improved to address the challenges ahead. Chapter 3 discusses the extent to which reforms of social benefits may raise work incentives, thus encouraging older workers to AGEING AND EMPLOYMENT POLICIES: ITALY – ISBN-92-64-01703-8 © OECD 2004 32 – INTRODUCTION participate in the labour market.

Excess unemployment is defined as any positive excess of unemployment above 5%. The countries used as benchmarks are the third best performing countries in the OECD area and are the following: for men aged 15-24, Denmark and Luxembourg; for men aged 25-49, Iceland and Mexico; for men aged 50-64, Switzerland; for women aged 15-24, Norway; for women aged 25-49, the Slovak Republic; and for women aged 50-64, Norway. AGEING AND EMPLOYMENT POLICIES: ITALY – ISBN-92-64-01703-8 © OECD 2004 46 – CHAPTER 2.

1). In other words, effective labour supply could be over one-fifth higher in Italy, should labour market behaviour move in line with best OECD practise. This is the second highest rate in the OECD area after Turkey (OECD, 2003b). The average OECD rate of mobilisable labour supply is 12%. In Italy, nearly all (90%) of these mobilisable resources can be found in inactivity. Older workers account for 40% of this excess inactivity compared to 29% for the OECD average. This suggests that there is scope in Italy for large improvements in participation rates, particularly among people aged 50-64.

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