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New social risks and the politics of post-industrial social policies Giuliano Bonoli
Introduction
The bulk of current research on the transformation of modern welfare states has focused on the issue of retrenchment and, in particular, on how cash-strapped governments have managed, or failed, to reduce the generosity of social programmes introduced during the post-war years. While this may be the most significant development going on in social policy, it is by no means the only one. Socio-economic change, usually described in terms of a shift from industrial to post-industrial economies and societies, has resulted in the emergence of new risk groups that clearly do not belong to the traditional clientele of the post-war welfare state and yet are experiencing major welfare losses. Over the past two decades or so, together with efforts aimed at containing the growth in social expenditure we have also seen the emergence of new policies catering for these social groups.
Risk structures have changed quite dramatically since the early postwar years. Trends in earnings inequality and labour market instability mean that today employment income alone is sometimes not sufficient to ensure a poverty-free existence, especially for families with children. Family instability, which is also on the increase, is on the other hand associated with a higher incidence of poverty, especially among lone parents. The risk of poverty is lower among the increasingly numerous two-earner couples, who are nonetheless facing entirely new problems and dilemmas in terms of reconciling work and family life. All these contingencies can be labelled ânew social risksâ (NSRs) and refer to situations that are typical of the post-industrial labour market and family structures in which we live today. They have little in common except the fact that they are generally not well covered by the welfare states that we have inherited from the post-war years, and that they tend to affect the same social groups, especially younger people, women and those with low skills.
Today, new social risks are ubiquitous in Western countries. The social transformations that have brought NSR into existence are progressing at different speeds in different countries, but overall, partly because of economic and cultural globalisation, they are having a massive impact in most places. The welfare states that we have inherited from the post-war years are gradually being adapted to the new emerging risk structures. However, the pace of adaptation and the degree of success vary across countries. Broadly speaking, the Nordic countries seem to have gone furthest in this process, by providing structures that facilitate the reconciliation of work and family life, by developing an arsenal of active labour market policies and a wage-setting system that protect the incomes of low-skilled workers, and by operating inclusive pension systems and comprehensive care service provision for elderly people.
Other welfare states have, generally speaking, been less successful in this restructuring process. Even though awareness of the societal consequences of inadequate NSR coverage is mounting in conservative welfare states such as Italy or Germany, these have taken only moderate steps, if any steps at all, in the direction of better protection of NSR groups. However, even within this world of welfare provision one can find some substantial differences. France, for instance, stands out as a country where reconciling work and family life is significantly facilitated by a large policy effort in the fields of childcare, parental leave, and so forth. Working mothers get generous pension bonuses that compensate for likely career interruptions. The long-term unemployed, if numerous, can rely on several active labour market programmes. Finally, Liberal welfare states have long ignored the emergence of NSR, and as a result are covered mostly by market instruments, with big inequalities in terms of access and quality of services. Risks related to the labour market have been dealt with by a strategy of strengthening work incentives, relying on both income supplements for low-paid workers (such as the American Earned Income Tax Credit) and workfare programmes.
But cross-national variation is not the only puzzle one encounters when studying the emergence of policies that provide coverage against new social risks. What is also striking is the apparent incongruence between the political weakness of those who are hit by these contingencies and the fact that policies meant to improve their living conditions are adopted. The expansion of post-war welfare states was very much the result of the mobilisation of the would-be beneficiaries of the social programmes adopted: the working class. Whether through Social Democratic or Christian Democratic parties and unions, wage-earners were able to impose a welfare model in which economic and social security for them was paramount (Esping-Andersen 1985; Huber and Stephens 2001a; Korpi 1983).
Things are obviously different for the groups who are currently hit by NSR. First, unlike those of industrial workers, their material interests have little in common, and this is arguably a major obstacle to successful mobilisation. Middle-class parents who find it difficult to reconcile work and family life are unlikely to join forces with low-skilled unemployed youth. The fact that their problems were not being taken care of by post-war welfare states is hardly a sufficient motive for doing so. Second, NSRs tend to be concentrated among the young, women and those with low skills â all features that are associated with reduced political influence, whether in terms of political participation (Norris 2002) or of presence in representative outfits such as parliaments, cabinets (Siaroff 2000b) and in labour movements (Ebbinghaus, Chapter 6). The power resources of those who are hit by NSR do not seem in any way comparable to those of the working class during the heydays of the post-war welfare state. Policies that provide coverage against NSR, to the extent that they are being developed, are unlikely to be the result of pressure by NSR groups. The most NSR groups can hope for, under current circumstances, is to be targeted by vote-seeking politicians looking for opportunities to claim credit for improvements.
The power resources of NSR groups alone cannot explain the development of post-industrial social policies. However, if this factor is considered together with other variables identified as determinants of social policymaking by previous research, the predictive power of the model increases dramatically. The main claim made in this chapter is that post-industrial social policies can be explained using the same independent variables that are known to have influenced the development of post-war welfare states: socio-economic developments, political mobilisation and institutional effects. There are nonetheless some important differences in the way in which these independent variables interact. Of crucial importance, for instance, seems to be the timing of the various relevant socio-economic, political and institutional trajectories followed by countries. Depending on this, national configurations of independent variables may be more or less favourable to the development of new social policies. As will be shown in the following, configurations of independent variables in relation to NSR policies have differed across welfare regimes, with the result that countries belonging to different âworldsâ of welfare capitalism have followed different trajectories. Before considering this explanation, however, the chapter presents a definition of NSRs and an attempt to map cross-national variation in the extent to which they are covered.
Defining new social risks
The concept of new social risks is being used with increasing frequency in the literature on the welfare state (see, for example, Esping-Andersen 1999; Hemerijck 2002). However, a precise definition of what is considered under this label is often missing. In this book, NSRs are seen as situations in which individuals experience welfare losses and which have arisen as a result of the socio-economic transformations that have taken place over the past three to four decades and are generally subsumed under the heading of post-industrialisation. Above all, deindustrialisation and the tertiarisation of employment, as well as the massive entry of women into the labour force, have increased the instability of family structures and the destandardisation of employment. New social risks, as they are understood here, include the following.
Reconciling work and family life
The massive entry of women into the labour market has meant that the standard division of labour within families that was typical of the trente glorieuses has collapsed. The domestic and childcare work that used to be performed on an unpaid basis by housewives now needs to be externalised. It can be either obtained from the state or bought on the market. The difficulties faced by families in this respect (but most significantly by women) are a major source of frustration and can result in important losses of welfare, for example if a parent reduces working hours because of the unavailability of adequate childcare facilities. To the extent that dual-earner couples with children are considerably less likely to be in poverty than families that follow the âmale breadwinner modelâ (Esping-Andersen 2002: 58), inability to reconcile work and family life can, especially for low-income parents, be associated with a poverty risk.
Single parenthood
Change in family structures and behaviour have resulted in increased rates of single parenthood across OECD countries, which presents a distinctive set of social policy problems (access to an adequate income, childcare, relationship between parenthood and work when children are very young). What is more, the incidence of poverty is particularly high for lone parents, especially if they are not in work (Esping-Andersen 2002: 37). For them, ability to reconcile work and family life may be crucial if poverty is to be avoided.
Having a frail relative
As in the case of children, during the trente glorieuses care for frail elderly or disabled people was mostly provided by non-employed women on an unpaid, informal basis. Again, with the change in womenâs patterns of labour market participation, this task needs to be externalised too. The inability to do so (because of lack of services) may also result in important welfare losses.
Possessing low or obsolete skills
Low-skilled individuals have, obviously, always existed. However, during the post-war years, low-skilled workers were predominantly employed in manufacturing industry. They were able to benefit from productivity increases due to technological advances, so that their wages rose together with those of the rest of the population. The strong mobilising capacity of the trade unions among industrial workers further sustained their wages, which came to constitute the guarantee of a poverty-free existence. Today, low-skilled individuals are mostly employed in the low-value added service sector or unemployed. Low-value added services such as retail sale, cleaning, catering, and so forth are known for providing very little scope for productivity increases (Pierson 1998). In countries where wage determination is essentially based on market mechanisms, this means that low-skilled individuals are seriously exposed to the risk of being paid a poverty wage (the United States, United Kingdom, Switzerland). The situation is different in countries where wage determination, especially at the lower end of the distribution, is controlled by governments (through generous minimum wage legislation) or by the social partners (through encompassing collective agreements). Under these circumstances the wages of low-skilled workers are protected, but job creation in these sectors is limited, so that many low-skilled individuals are in fact unemployed (Iversen and Wren 1998). Overall, the fact of possessing low or obsolete skills today entails a major risk of welfare loss, considerably higher than in the postwar years.
Insufficient social security coverage
The shift to a post-industrial employment structure has resulted in the presence in modern labour markets of career profiles that are very different from that of the standard male worker of the trente glorieuses, characterised by full-time continuous employment from an early age and with a steadily rising salary. Yet the social security schemes (most notably pensions) that we have inherited from the post-war years are still clearly based on these traditional assumptions regarding labour market participation. Pension coverage, in most West European countries, is optimal for workers who spend their entire working life in full-time employment. Part-time work usually results in reduced pension entitlements, as do career interruptions due to childbearing. The result of the presence of these new career profiles in the labour market may be, if pension systems are not adapted, the translation of the labour market and working poor problems of today into a poverty problem for older people in thirty or forty yearsâ time. From an individual point of view, the fact of following an âatypicalâ career pattern represents a risk of insufficient social security coverage, and hence a loss of welfare.
New social risks in post-industrial societies
These situations are caused by different factors, but have a number of things in common. First, they are all ânewâ, in the sense that they are typical of the post-industrial societies in which we live today. During the trente glorieuses, the period of male full employment and sustained economic growth that characterised the post-war years, these risks were extremely marginal, if they existed at all.
Second, different NSR tend to be concentrated on the same groups of individuals, usually younger people, families with small children, or working women. While it is difficult to set clear borders around the section of the population that is most exposed to new social risks, it is clear that the categories mentioned here are to some extent overlapping. This partially overlapping character of NSR results in the existence of a section of the population, varying in size in different countries, that is hit by various contingencies. Low-skilled single parents, low-income working mothers or low-skilled young unemployed people are likely to experience additional difficulties because of the accumulation of disadvantage that affects their position. These situations are also those that most often result in social exclusion (Room 1999).
Third, NSR groups have a further thing in common. They are generally not well served by the post-war welfare states. These tended to focus their efforts on core workers with stable employment and uninterrupted careers. In an ideal-typical post-war welfare state concerned above all with the preservation of the income of the male breadwinner, the groups identified here as mostly exposed to NSR do not benefit from social policies.
NSR groups can be regarded as a social category whose members, as a result of the socio-economic transformations associated with the shift to a post-industrial society, are having a particularly hard time. It would not be correct to label them the âlosersâ of post-industrial societies. For some of them, especially women, the new social structures represent tremendous opportunities in terms of emancipation, but they also generate powerful dilemmas. This combination of opportunities and difficulties is also what characterised industrial workers during industrialisation. Work in the factories and life in the cities were hard, but they brought new opportunities in terms of access to cash income, technology capable of enhancing quality of life, and so forth.
Mapping diversity in post-industrial social policy
To measure the degree of development and the effectiveness of postindustrial social policies is far from being a straightforward task. To some extent this exercise reflects the difficulties encountered by students of the post-war welfare state when trying to measure the âwelfare effortâ made by different countries. Comparative social policy turned first to easily available indicators, such as spending as a proportion of GDP on the relevant programmes (Wilensky 1975), and later to more sophisticated ones that paid attention to the outcomes of social policies in terms of redistribution or decommodification (Esping-Andersen 1990; Huber and Stephens 2001a). My attempt to map cross-national variation in the provision of NSR coverage follows a similar approach. It starts by looking at spending figures and then tries to develop indicators based on social outcomes.
Figure 1.1 provides expenditure data on two key dimensions of provision against NSR, family services and active labour market policies. Together, these two areas of policy address many of the risks mentioned earlier, including single parenthood, reconciling work and family life, and possessing low skills. The clustering of countries along these two key dimensions of post-industrial social policy is reminiscent of Esping-Andersenâs classification of welfare regimes, possibly with a distinction bet...
