Word mavens take note. The French have given a name to the anxieties of globalization: "Precarite." In English, "Precarite" translates to "precariousness," a mouthful to be sure, but the emotions it has unleashed threaten to paralyze France.
French college students have taken to the streets protesting a new law that would allow employers to fire anyone under 26 for any reason within the first two years of employment.
The conservative government in France argues adopting the new law would make it less risky to hire new workers, and it would bring down France's youth unemployment rate from its current level of 20-plus percent. That's the theory. The students say changing the law would introduce "Precarite."
It may be tempting for Americans to dismiss this as another exotic French notion. After all, most Americans can be fired at any time and we don't get the kind of generous severance the French government proposes for young workers who get the ax. But precariousness gets at a real concern. Around the world, workers are being forced to take on more economic risk in order to remain employed. Defined benefit pension plans shifted the long-term risk of retirement to employers. No thanks now say employers, shoving the risks back to the workers in the form of 401(k)s and defined contribution plans. Build your own nest.
It's the same story with health care where co-payments and cost-sharing reduce the burden on employers. A survey by the Kaiser Family Foundation found 40 percent of employers expect to ask their workers to pick up even more of the health care bill in the future.
It's not just about benefits. Workers are also bearing more of the business risks. The French are fighting a change in the contract for young workers, because middle-aged workers know they will be next. Americans already face a fluid work environment. Consider what's happening with worker schedules. Experts say not too long ago retailers gave their workers a fixed schedule. Now it is not uncommon for a manager to send workers home early when the store is empty. Instead of hiring more employees, companies bring on contract workers for a set project. If it doesn't work out, it is easy to let them go.
Economist Jared Bernstein calls it a "just-in-time workforce."
It isn't all bad. In return for taking on more risk, some contract workers are paid much more than they would make on the regular payroll. The extra money makes up for the extra risk of the contract coming to an end.
This flexibility is an important reason why our unemployment rate is 4.8% compared with almost 10 percent in France. In France you have - or had - a job for life. If you were fired in the first two years on the job, your employer might have to pay you up to a years salary in severance. The French employment code weighs 22 pounds. That's a lot of protection on paper, but in reality it is a great incentive for French companies and investors to put their money overseas.
The result is that fewer people have jobs in France. In the US, workers face more risk, but many more people have jobs, and it is easier to find a job when you lose one. Indeed, in some industries, labor-force flexibility may allow companies that would otherwise fold up shop or move offshore to remain in the US.
Of course "precariousness" can become a race to the bottom. There may always be a worker in another country with fewer protections who is willing to work for less in worse conditions. When I visited an auto plant in China I was told the workers "got used" to the poor ventilation. Poor or dangerous working conditions are more flexible for employers, but that doesn't mean we should tolerate them.
If the "just-in-time workforce" in the US sounds precarious - it may be. It may also be the wave of the future. If so, it may be better to find a way to surf this wave rather than take to the streets as the French have. Policy makers can and should think about ways to reduce the burdens on employers in such a way that employees still enjoy basic protections. The President is trying to do this with Health Savings Accounts. Meanwhile, Democrats push universal health care as a safety net and a lifeline for employers struggling with the rising costs of benefits.
Clearly we are a long way from solving "Precarite." I also think we are not quite there when it comes to naming the new feelings of anxiety and insecurity workers have when confronted with flexible work arrangements. Precariousness is real, but the moniker is too highfalutin. We need a more visceral term for the emotional anxieties of this global age. I am open to your suggestions.
