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Abstract
The 1990s saw an important shift from long-term reform sclerosis in the Italian industrial relations and welfare state systems to important innovations, both in the mode of policy making (concertation via social pacts) and the content of reform (decentralisation in the collective bargaining system and greater flexibilisation of a highly rigid labour market). After 1998, concertation weakened considerably once macroeconomic convergence for membership of EMU had been achieved, and contestation of the collective bargaining system and labour market regulation reappeared. This article seeks to explain the rise and demise of concertation over the past decade or so, and to assess the consequences of reform for wage bargaining and employment.
Notes
1. The scala mobile granted absolute rather than proportional wage increases in the face of inflation, thereby guaranteeing purchasing power and favouring low paid workers (Devicienti Citation2003).
2. The Pact for Development, Employment and Competitiveness signed in June 2003 identifies research, training, the south of Italy (Mezzogiorno) and infrastructures as the four priority areas for the country's economic and social development.
3. The Pact for Employment, Competitiveness and Development (June 2003); Agreement to Relaunch the Development and Competitiveness of the South of Italy (November 2004); Manifesto for the Development of Italy's Mezzogiorno (December 2005).
4. One of the reasons for the proliferation of firms under 15 workers, in 2002 Article 18 covered less than 10 million workers, as some 12.5 million were employed in firms below the 15-employee threshold. The government's reform proposals were not especially radical. They would have involved Article 18's experimental suspension for three years and only for those firms emerging from the shadow economy those increasing employment through new regular hires to more than 15 workers, and those transforming temporary employees into permanent ones (Ferrera and Gualmini Citation2004: 157–8).