Combining flexibility and security with the help of “flexicurity”?

One aspect emphasized by Esping-Andersen is the way in which the labour market is regulated (Esping-Andersen 1999, 2000). This leads us to the aforementioned “buzzword”

in the field of labour market research: “flexicurity.” Like “precarious work” and

“precariousness”, the concept originally stemmed from a political debate that took place in the mid 1990s in the Netherlands and has subsequently been discussed at the EU-level. It has simultaneously been taken up and developed by social scientists and labour market researchers (Kronauer & Linne 2007). One commonly used definition states that flexicurity is

a policy strategy that attempts, synchronically and in a deliberate way, to enhance the flexibility of labour markets, work organization and labour relations on the one hand, and to enhance security – employment security and social security – notably for weak groups in and outside the labour market on the other hand. (Wilthagen & Tros in Kronauer & Linne 2007, p. 14)

Formulated in this way, flexicurity refers to a political reform programme to be applied in times of the “post-industrial economy,” which is (apparently) in need of flexibility among the work force. It draws upon insights from economics and labour market research, which state that, amongst other things, the globalisation of economies leads to a need for flexibilisation (e.g. for companies) amongst employees. Furthermore, it is assumed that any increase in flexibility of the employees/work force will lead to a decrease of employment security. The flexicurity approach, then, argues against this assumed trade-off, and proclaims that under certain conditions, employment flexibility and security can be achieved simultaneously. Wilthagen has called this the flexibility-security nexus (Muffels 2008a, 2008b).

The perspective on flexicurity described above has also been called the liberal view on flexicurity, because it focuses on the economy and sees flexibilisation as an economical necessity required in order to enhance the competitiveness of European economies. The

“trade-unionist” perspective on flexicurity, as Fink (2006) calls it, has a different point of departure, namely the workforce under the conditions of post-industrialism. Thus, social security is emphasized (not competitive economies) and flexicurity is seen as an alternative

to flexibilisation and de-regulation only. This approach sees social protection of workers in the context of de-regulation and flexibilisation as the main goal of the concept of flexicurity (Fink 2006).

With reference to the concept of flexicurity (be it with a “liberal” or a “trade-unionist” perspective), a number of researchers in Europe subsequently analysed labour market and welfare state regulations and policies in order to find out how much they resemble the “ideal” of flexicurity, and how and in what ways flexicurity could be enhanced and enforced (Muffels 2008a, 2008b). Kronauer and Linne state that the focus of what is to be secured through social security is going to be changed with flexicurity – from “stable employment” to “employability.” With Esping-Andersen, we could argue that this accords with the “new risk structure” in post-industrial economy. Indeed, as Kronauer and Linne state, it aims at a new adjustment of social welfare state principles – and therefore, can and should be questioned regarding its impact on (in-)equality, exclusion and inclusion (Kronauer & Linne, 2008).

Within this discourse, Denmark has often been called a model country or blueprint of how flexicurity is possible. This is due to what has been called the “golden triangle” of flexicurity, which, following Madsen (2008), consists of (1) a highly flexible labour market with a high degree of mobility among workers, including a low level of employment protection, which makes it possible for employers to flexibly adapt the workforce to their demands; (2) a high economic support in the case of unemployment; and (3) active labour market policies for the unemployed. Concerning the second point, the flexicurity literature often only mentions the quite generous unemployment benefit, but in fact it also refers to other aspects of the social-democratic welfare state, which is built upon universalistic principles. With regards to the Danish flexicurity model, as a possible model of best practice, Madsen concludes:

If a liberal regime of employment protection is combined with institutions that support income (and employment) security, one can obtain a competitive employment system and social welfare combined. The challenge is to achieve the level of thrust between the social partners which allows for employment protection to be reduced, while security mechanisms are being created. (Madsen 2008, p. 360)

It becomes clear that most of the flexicurity literature including in the above cited article by Madsen refers to employment and employees, which (again) leaves out the freelancers this study is concerned with. Nevertheless, flexicurity seems to be a relevant aspect, as freelancers can be positioned amongst the most flexibilised work forms, which makes the question about their social security extremely relevant. We could also assume that a welfare state relying on universalistic principles could provide the best possible “security conditions” not only for flexibilised employment but also for freelancers.

Lise Lotte Hansen (2007) criticises Madsen's analysis of the Danish flexicurity model: in line with criticism on Esping-Andersen's welfare state typology mentioned above, Hansen accuses Madsen and other flexicurity experts writing about Denmark as a

“model country” concerning flexicurity of ignoring the fact that the Danish model of childcare services is constituting a precondition for the possibility of being flexible for parents (mainly mothers). The fact that there is easy access to high-quality public day-care allows parents with young children to participate in flexicurity. Thus, Hansen suggests to extend the flexicurity triangle to a square by adding public care to it. Following on from this, she suggests a change of name to “flexicarity” in order to show the importance of care services for the model (ibid).

Concerning the “ideal of flexicurity,” that is, labour market flexibility combined with social security, it comes as no surprise that the conservative welfare state, here relevant in its German embodiment, scores quite low. Fink and Tálos (2008) quite pessimistically state in the end of their analysis on flexicurity in the conservative welfare states of Austria and Germany that:

In general, the suitability for flexibilisation in conservative welfare states like Austria and Germany can be rated as low. The main problem lies in the still dominant orientation on life-long employment in the organisation of social security or rather in the thus predominant reproduction of income inequalities in the labour market by the welfare state. Taking into account the growing labour market flexibilisation, this is leading to a wide divergence in the level of benefits and in many cases to benefits that are so low that they do not sustain a living. Furthermore, there are several forms of fundamental exclusion. Although this implies a considerable need for action, the governments of the two countries concerned [Austria and Germany, B.F] do not take

adequate measures, or even do not take measures at all (Fink & Tálos 2007, p. 413, author's translation).

It is quite striking how all considerations about the conservative welfare state model in the context of the current transformation of work (namely flexibilisation and de-regulation) come to similar conclusions, be it calling it precarious work (Castel 2003), the insider-outsider problematic (Esping-Andersen,1999?) or, in the context of flexicurity, fundamental exclusion (Fink and Tálos, 2007). On the other hand, there is the social democratic welfare state model, which, through its universalistic principles, appears to be better equipped to deal with these developments. The “flexicurity” model in Denmark, which seems to be especially well equipped to face these challenges due, as flexicurity researchers like Madsen state, to very liberal labour market regulations, is a case in point.

This raises the question as to whether Germany is, indeed, the “homeland of precariousness,” while Denmark, for its part, is the “homeland of flexicurity.” In any case, it becomes clear that freelancers in Germany are faced with very different structural conditions than their Danish counterparts, including possible consequences for individual social security. This has to be taken into account when asking the interviewees about their handling, coping, and strategies in dealing with freelance work. Hence the need to contextualise the empirical material referring to the issue of (in)security in the narratives of the Danish and German freelancers within the above described macro-societal framework becomes clear.¹⁷ However, when atypical work is thematised, freelancers are not very often included (or, like Brinkmann et al' s (2006) account on precarious work, explicitly excluded). Obviously, and maybe because of the hybrid status between entrepreneur and employee, they seem to be the very atypical “atypicals.” In the next chapters, then, I am going to take a closer look at what the “social security situation” for freelancers looks like in Denmark and Germany.

17 I will do this in chapter 8.