The Chilean Labor Market : A Key to Understanding Latin American Labor Markets

Kirsten Sehnbruch uses the case study of Chile to show the failures and inner-working of neo-liberal labour policy. She shows in detail what the real policy issue should be, namely the creation of proper institutions and of a corps of competent professionals with relevant skills and powers to operate them. This is extremely timely work, in that institutions are a matter of enormous concern in the international development community of policy-makers, who are desperate to make current orthodoxy work in terms of sustainability, the quality of life, human development and other dimensions beyond GDP growth. Cover......Page 1 Contents......Page 8 List of Tables......Page 14 List of Figures......Page 16 Abbreviations and Terms Specific to the Chilean Context......Page 18 Acknowledgments......Page 22 1 Introduction: Model Performance or Precarious Employment?......Page 28 2 Employment in the Development Context: The Contribution of the Capability Approach......Page 46 1. Sen's Capability Approach......Page 47 1.2. Functionings......Page 49 1.3. Capabilities......Page 51 2.1. Basic Needs......Page 53 2.2. Social Exclusion......Page 54 2.3. Comparison of Approaches......Page 55 3. Applications of the Capability Approach......Page 58 4.1. Labor Market Policies as a Fallout of Other Development Policies......Page 59 4.2. The Labor Market as a Vehicle of Development and Expanded Capabilities......Page 62 5.1. Defining the Quality of Employment......Page 65 5.2. Applying the Capability Approach to the Labor Market......Page 67 6. Conclusions......Page 69 3 The Never-Ending Story of Labor Market Reform......Page 72 1. The Process of Labor Market Reform in Chile......Page 73 2. The Labor Market before 1973......Page 76 3. Labor Market Reforms under the Pinochet Administration......Page 79 4. A Decade of Labor Market Reforms under Aylwin and Frei (1990–2000)......Page 83 5. Legislative Reform under Lagos......Page 90 6. Concluding Remarks......Page 92 4 The Characteristics of Employment in Chile......Page 98 1.1. The National Employment Survey......Page 99 1.2. The Employment Module of the National Household Survey, CASEN......Page 101 1.3. Other Labor Market Surveys......Page 102 1.4. The Politics of Information......Page 104 2. Participation, Employment, Unemployment, and Wages......Page 106 3. How Do We Look at the Data on the Chilean Labor Market?......Page 108 4.1. The Male and Female Workforce......Page 112 4.2. Levels of Education......Page 116 4.4. Economic Sector......Page 117 4.5. Levels and Distribution of Income......Page 118 4.6. Health, Pension, and Unemployment Insurance......Page 119 4.7. Tenure and Job Rotation......Page 126 4.9. Vocational Training, Additional Employment, and Part-Time Work......Page 128 5. What the Data Does Not Tell Us......Page 132 6. Conclusions so far......Page 135 5 The Development of the Chilean Labor Market......Page 138 1. Unemployment and Underemployment......Page 139 2. The Changing Characteristics of Employment in Chile......Page 142 3. The Effects of the 1998–1999 Economic Crisis......Page 145 4. Employment Mobility Within the Chilean Labor Market......Page 148 5. Employment, Poverty, and Income Distribution......Page 154 6. Levels of Unionization......Page 157 7. The Enforcement of Regulation......Page 160 8. Conclusions......Page 163 6 Legislation versus Practical Reality: Chile's Unemployment Insurance......Page 166 1. How Does the Unemployment Insurance Work?......Page 168 2. Ideological and Theoretical Context......Page 171 3. The Political Context of the Unemployment Insurance Legislation in Chile......Page 175 4. Characteristics of the Employed and Unemployed......Page 178 5. Simulation of the Unemployment Insurance......Page 186 6. Evaluation of the Chilean Unemployment Insurance Scheme and Conclusions......Page 189 7 Vocational Training: Missing the Opportunities......Page 194 1. Theoretical Considerations and the Latin American Context......Page 196 2. The Historical Context: SENCE's Origins......Page 200 3. Vocational Training under the Concertación: Reforming SENCE's Statute......Page 204 4.1. Empirical Evidence on Vocational Training: The Official Data......Page 207 4.2. The empirical Evidence on Vocational Training: Data from the National Household Survey (CASEN)......Page 214 4.3. What the Data Does Not Tell Us and Other Conclusions so far......Page 219 5.1. Chile Joven......Page 221 5.2. Apprenticeships......Page 224 5.3. Emergency Employment and Vocational Training: ProEmpleo......Page 226 6. Conclusions and Policy Recommendations......Page 227 1. The Need for a Quality of Employment Indicator......Page 236 2. Methodological Issues and the ILO's Decent Work Indicators......Page 237 3. Construction of an Alternative Quality of Employment Indicator......Page 242 3.2. Occupational Status and Social Security Coverage......Page 243 3.3. Income......Page 246 3.4. Stability of Employment: Tenure......Page 247 3.5. Training......Page 248 3.6. Weighting and Other Methodological Issues......Page 249 4. Practical Applications of the Quality of Employment Indicator......Page 251 4.1. Segments of the Labor Force with Low-Quality Employment......Page 252 4.2. Individuals in the Index......Page 259 5. Conclusion......Page 263 9 Conclusions: Quality and Quantity......Page 264 1. The Range of the Quality of Employment in Chile......Page 265 2.1. Historical Definitions in a Modern Labor Market......Page 269 2.2. Deregulation: Partial Reform and Flexibility at the Margins......Page 275 3. Institutional Capacity and Political Priorities......Page 282 4. Information Policy......Page 287 5. Labor Relations......Page 289 6. Toward a Pro-Employment Development Strategy......Page 292 7. Conclusions......Page 296 Appendix A: Details of the Unemployment Insurance Scheme......Page 300 Appendix B: Unemployment in Chile......Page 306 Appendix C: Determining Factors of the Quality of Employment......Page 310 Notes......Page 312 Bibliography......Page 344 C......Page 360 I......Page 361 P......Page 362 U......Page 363 Y......Page 364 "The performance of Latin American labor markets over the last decades is now widely acknowledged to have been disappointing. Neo-liberal structural adjustment policies have not brought the hoped for results, neither in terms of employment generation nor in regard to poverty rates. Kirsten Sehnbruch uses the case study of Chile to show the failures and inner-workings of neo-liberal labor policy. Using Amartya Sen's capability approach, she highlights the importance of the much neglected issue of employment policy in the development agenda, and shows that policy makers cannot focus on just the unemployment rate as their main concern: the quality of employment is at least as important."--Jacket