Across Europe, shadow markets constitute a significant portion of the economy. According to some estimates, an average of 16% of GDP in EU member states is generated by the shadow economy.
The EU sets minimum levels of regulation with respect to working hours. The research shows that the countries tend to comprehensively follow the set EU standards with regard to the maximum duration of work during the day, minimum periods of rest, and some aspects of annual leave.
The introduction of the controversial 500+ program in Poland has so far resulted in no increase in fertility rate. Noteworthy, 12% of the program budget would be sufficient to eliminate extreme child poverty. Meanwhile, 100,000 women were pushed out of the labor market.
Under EU legislation, Member States are required to abolish any legal provisions contrary to the principle of equal treatment and have to introduce measures that would facilitate getting legal remedies in cases of alleged violations of equal treatment.
The ruling politicians are unfortunately going in the opposite direction. While a person working for a minimum wage in 2015 paid 29% in taxes and levies, with the planned minimum wage, they will pay more than 40% next year.
The study presents different models which take into account the consequences for the individual, the state budget, and the labor market. The suggested reform variants make it a significantly more attractive option for Hartz IV recipients to work more, by raising income retention by up to 40 percent.
The 2017 labor law reform significantly improved Lithuania’s position in the Employment Flexibility Index, moving the country from the 27th to 15th position among the EU and OECD countries, according to Employment Flexibility Index 2019 compiled by LFMI based on the World Bank’s Doing Business data.
Labor market flexibility may be characterized by the market participants’ abilities to deviate from standard labor regulations and typical forms of employment. Such possibilities may not only provide positive outcomes to both employers and employees, but they may also benefit the whole economy.
The most important figure of the Slovak economy in the last 5 years has been the trend in unemployment. This rate had been decreasing since the first quarter of 2013 and had dropped to almost a half in the first quarter of 2018. The unemployment rate fell from more than 14% to nearly 7%.
LFMI has just released its latest paper “Labor Migration and Flexibility of Regulation for Employing Non-EU Nationals”. It addresses the economic effects of migration and implications of employing non-EU nationals and provides a cross-country legislative and policy analysis on the flexibility of hiring of non-EU nationals.