Vision to Reality: The Reut Blog

The economic crisis has led to calls for the government to encourage employers not to fire their workers. However, this policy may perpetuate non-competitive factories and industries at a high cost.

In the meantime, the consolidation of three separate factors may create a window of opportunity to design a more relevant labor market policy:

First, the establishment of a new government may facilitate major economic steps; The second factor is the unique relationship between the head of the Histadrut labor union, Ofer Eini, and the President of the manufacturers association, Shraga Brosh; The third is the economic crisis that encourages all major stakeholders to show some flexibility regarding the ‘rules of the game’ in the labor market.

In this context Reut recently published an article discussing the Danish employment model – Flexicurity. This model ensures a competitive and thriving economy on the one hand and workers’ security on the other. Under this model, employers can fire workers relatively easily in order to maintain their firms’ competitiveness. However, the workers benefit from life long learning programs and a generous security net in times of unemployment.

For further reading, see Reut paper: Flexicurity.