EFFECTS OF LABOR MARKET FLEXIBILITY ONE YEAR AFTER THE JOBS ACT: SUMMARY OF THE WORKSHOP ORGANIZED BY THE INSTITUTE OF ECONOMICS

What have been the effects of the labor market flexibility in Italy and Europe? The workshop organized by the Institute of Economics at Sant'Anna School as part of the activities of the European project "ISIGrowth" (Innovation- fueled, Sustainable, Inclusive Growth) coordinated by Sant'Anna School for Advanced Studies, started addressing the issue "A year after the Jobs Act: the effects of the labor market flexibility ".

The first session of the workshop provided valuable theoretical and empirical elements to encourage the debate on structural reforms and economic policy recipe for stimulating growth and employment. Discussants included: Clemente Pignatti (ILO), Paul Sestito (Bank of Italy), Michael Raitano (La Sapienza University of Rome), Lia Pacelli (University of Turin).

A special focus has been devoted to the so-called “Jobs Act”. The research presented by Paul Sestito reveals that 40 percent of new contracts issued after the reform are attributable to tax credit policies and only 5 percent is attributable to the increasing employment contracts protection. According to the findings, the reform has not hit the target for which it was enacted: reducing the dualism of Italian labor market and promoting job stability.

The assessment was confirmed at any level, general and national, by the paper "Labour Market Reforms in Italy: Evaluating the Effects of the Jobs Act" written by Dario Guarascio, Marta Fana and Valeria Cirillo as a part of the ISIGrowth project activities. Employment trends in the first quarter of 2016, seem to confirm, Marta Fana explained, that companies signed new contracts as the immediate effect of tax relief policy.

The second session continued with a round table discussion moderated by Giovanni Dosi (Director of Sant'Anna School Institute of Economics ) and the invited speakers were Stefano Franchi (Managing Director of Federmeccanica) and Maurizio Landini (General Secretary of Fiom). The Jobs Act assessment made by Stephen Franks shows positive results: "Most of our companies has just hired new employees thanks to the tax benefits enacted by the government and their combination with the regulatory lever”. On the contrary, Maurizio Landini underlined that "the Jobs Act is wrong, totally useless for employment protection and ineffective to restart the economy".