Demographic Challenges and Labor Law Responses

Demographic Challenges and Labor Law Responses Presented by: Prof. Dr. Jakab Date: 8 October 2023 Identifying the problem - In 2050, 80% of older people will be living in low- and middle-income countries. The pace of population ageing is much faster than in the past. In 2020, the number of people aged 60 years and older outnumbered children younger than 5 years. - Between 2015 and 2050, the proportion of the world's population over 60 years will nearly double from 12% to 22%. The complexity of the problem is compounded by the fact that the ageing of society poses a number of challenges for labor law, employment policy, fiscal policy and social care systems. - Young people can make a significant contribution to the Lisbon objectives of job creation and growth, as they are the workers and employers of the future and a source of much needed skills in research, innovation and entrepreneurship. - The proportion of older people in Europe is rising rapidly due to increasing life expectancy and declining fertility. The proportion of people aged 65 and over in the working age population (15-64) is expected to reach 50% by 2050, double the current rate. These demographic developments have significant social and economic consequences. - This situation creates significant challenges for labor supply and the functioning of social protection systems. - Demographic changes will reduce the working age population. Currently, only two thirds of the working age population is employed: in the US and Japan the figure is over 70%. - Expenditure on "social protection" remained by far the most important COFOG (Classification of the Functions of Government) division in 2021 in the EU and in all reporting Member States and EFTA countries. - n the EU in 2021, expenditure on social protection stood at €2 983 billion, equivalent to 20% of total expenditure on social protection.5% of GDP and 39.9% of total expenditure. By far the most significant group in this division, "old age" (10.8% of GDP) relates mainly to pension payments. Expenditure in "sickness and disability" (2.9% of GDP), the second largest group, represents mainly social payments in cash or in kind related to social insurance schemes. Labor Law regulation - This is the broad framework within which we can present the qualitative criteria of a life worthy of the active and inactive, i.e. once working, person. - Heraclitus quotes that the only constant is change itself. So it is with labor law, which is constantly changing. In this change, we have sought permanence, which we have seen only in fundamental rights and other values. - equal opportunities and the right to work, decent work, social protection and social inclusion Strategies to address demographic challenges - 1999, Samorodov • 2020, Harasty and Ostermeier outlined the projected trend in labor market participation of older workers up to 2030. Activating the potential labor force: a large proportion of the young population is not in education, employment or training; in addition, young and adult women in particular are disproportionately excluded from the labor market, often because of their involvement in family caring responsibilities. At company level, workplaces and work organisation need to be adapted to the needs of older workers. Creating better and more productive jobs and investing in training and education throughout the lifecycle, and providing opportunities for continuous retraining and upskilling. - Demographic changes mean that, as technology advances year on year, there is a growing gap not only between the old and the young, but also between the generations that are closer together. Different skills mean different motivations, which can lead to conflicts. - Conflicts that arise, and their resolution, are always an opportunity for the company to introduce appropriate changes. The success of the management of such a conflict is an indicator of the success of the subcontracting itself, whether it is an internal or an external stimulus. - Intergenerational understanding can be fostered by encouraging dialogue and promoting cooperation. Annual satisfaction surveys, the selection of the right leadership style, and mentoring programs involving several generations can also be effective solutions. - These programs should include: vocational education and training in later life, healthy working conditions, age management strategies, employment services, preventing age discrimination, employment-friendly tax/benefit schemes, transferring the experience and reconciling work and care. - successful HR management - personalized incentive scheme - By improving working conditions, companies can also help to keep employees healthy. - Tackling the employment crisis resulting from demographic change appears to involve a comprehensive set of policy and HR tools. However, there are also labor law regulatory instruments, among which we highlight partnership-based negotiations between workers' representatives and employers. - Conclusions of a Central European research • The Central European research, supported by the Central European Academy, has identified good practices and actions for the sustainability of social security systems in the region, based on eight country reports (Polish, Slovak, Czech, Slovenian, Romanian, Croatian, Serbian and Hungarian). • According to the country reports on sustainability issues it can be concluded that good practices have been related to the employment and rehabilitation of people with disabilities, which undoubtedly has a positive impact on the sustainability of the social security system. • The social security system would be largely steered towards sustainability by the development and implementation of long-term care rules. • The Czech proposal is to ensure greater financial stability of social insurance, it is necessary to consider unifying the collection of public health insurance premiums with social security premiums and contributions to state employment policy. • According to the Slovenian proposal the constitutional review concerning future amendments as well as the enforcement of the human right to social security certainly seems more important than ordinary judicial review. • There are several changes and measures taken towards the sustainability of the pension system in the Central European countries: a person, who retires prematurely, may experience a 15% reduction in the level of their calculation percentage; limitation of public expenditure in the field of pensions is the regulation of a limited calculation, but unlimited contributory base; the years of salaried employment which make up the pension base, are still limited; the process of gradually increasing and equalizing the universal retirement age for both sexes; tighten the conditions for pension eligibility and to introduce and apply a points-based calculation of pensions.