Public Sector Employment Regimes

Transformations of the State as an Employer

Karin Gottschall, Bernhard Kittel, Kendra Briken, Jan-Ocko Heuer, Sylvia Hils, Sebastian Streb, Markus Tepe

• Publisher: Palgrave Macmillan
• Year: 2015
• ISBN:
  9781137313119
• Topic: Politics & International Relations
• Subtopic: Comparative Politics
• Index: Politics & International Relations

This book explores the extent to which a transformation of public employment regimes has taken place in four Western countries, and the factors influencing the pathways of reform. It demonstrates how public employment regimes have unravelled in different domains of public service, contesting the idea that the state remains a 'model' employer.

1

Introduction

Setting the scene: public sector and state transformation

Since the 1980s, the public sector has constantly been an object of structural reforms and quantitative adjustments. In several waves, public infrastructures and services have been privatized, political power and responsibility have been decentralized and recentralized to and from the regional and local levels, and new forms of management in public administration have been implemented, thereby substantially changing the face of Western nation-states.

Driven by pressures of cost containment and a neo-liberal political agenda, many of these changes imply that the responsibility for the provision of public goods, which for a long time was linked to distinct public employment regimes, no longer lies with the state alone, but is shared with other (private) actors. Moreover, when still in charge, the state aligns its activities in the provision of services to market rules (Derlien and Peters 2008; Vaughan-Whitehead 2013).

In a broader context, these processes have been considered part of the ‘unravelling’ of the Western nation-state, defined as a territorial unit (T) which secures the rule of law (RU), is legitimized by democracy (D), and is willing to intervene (I) in market developments, summarized in the acronym TRUDI (Leibfried et al. 2015; Leibfried and Zürn 2005). The decline of TRUDI evolved in an era of accelerated economic and political globalization, in which more and more traditional state functions have been supplemented by, or handed over to, private providers or transferred to the international arena. Thereby, core attributes of the modern democratic Western state, such as sovereignty, the rule of law, and welfare provision, have been undermined (Grimm 2005; Scharpf 2000).

However, as many scholars have pointed out, the catchy narrative of nation-state decline in favour of markets is one-sided. It fails to capture the fact that market-making is also the product of state intervention. Many of the same international developments that are claimed to narrow the scope of the state, such as free capital and human resource flows, at the same time enable and call for new state activities, such as the regulation of financial markets or border controls (Levy et al. 2015). The same holds true for the privatization of public infrastructure, such as energy or telecommunication, where the newly created markets tend to be dominated by large corporations which have emanated from former state monopolies. In these fields, although the state is no longer engaged in the provision and organization of this infrastructure, it nevertheless has to take on the role of market control, which is visible in many countries in newly set-up agencies after the first waves of public infrastructure privatization (Schneider et al. 2005; Zohlnhöfer et al. 2008).

Likewise, adjustments in the volume and structure of public employment need not necessarily indicate a retreat of the state. While employment is obviously shifted from the public to the private sector by the privatization of infrastructure and the welfare state reforms privileging market provision of social services, enhanced state activities in other areas, such as public security, often imply an increase in budget and personnel (in this case, for police forces), emphasizing the provision of security as a core state function (Derlien and Peters 2008). Even personnel restructuring in public administrations and services inspired by private sector management methods may reinforce rather than weaken the role of the state. To the extent that personnel with higher qualifications becomes more important for the provision of public goods, and to the extent that public employment regimes approach private sector regimes, the openness to private labour markets imposes on the state as employer the need to be more competitive – that is, to invest in its attractiveness as an employer.

Thus, rather than addressing changes in state activities as a decline, they should be analysed as a transformation of states’ capacities to act in changing economic, political, and social environments (Sørensen 2004; Levy 2006; Levy et al. 2015). Given the diverse facets of state activity, as well as its embeddedness in multi-level systems and national institutional orders, adequately capturing these transformations provides a challenge which can best be met by breaking down state activities into various dimensions, each of which needs to be explored (Hurrelmann et al. 2007, p. 2).

Against the background of these developments, in this volume we will address the role of the state as employer as a core element of state activity, and focus on public employment as a basic resource for the provision of a variety of normative goods in Western nation-states.¹ The main focus of the book is on changing public employment regimes, which have so far been mainly studied by scholars in public administration research. Informed by insights from both labour market sociology and political science, this book explores the role of the state as employer in a broader context. Under conditions of budget restrictions and public sector reform on the one hand and competition with the market sector on the other, how is the state shaping the employment conditions and relations of civil servants and public employees?

Change dynamics: from public sector expansion to public sector reform

Obviously, the very existence of the modern democratic nation-state rests on the existence and functioning of a public administration (Rose 1985; Derlien and Peters 2008). From the very beginning, the effectiveness and efficiency of state action has been dependent ‘on the success of the state in creating bureaucratic organizations close to the Weberian ideal type’ (Huber et al. 2015, p. 15). At the core of these bureaucracies is the ideal type of the civil servant, who trades employment security and other privileges against loyalty to the state.

While originally focused on securing safety and the rule of law, during the ‘Golden Age’ of the welfare state from the 1960s to the 1980s, the modern democratic state also took on the role of providing encompassing infrastructure and welfare to its citizens. Based on economic prosperity and rising state revenues in the post-war era, most Western states expanded public employment in order to provide services in a wide array of social and economic spheres, including social security, education, healthcare, labour market services, and infrastructure (Flora 1986; Kaufmann 2001). The employment conditions of the civil service included high employment security, seniority rules in pay and advancement, and prescribed career paths, which distinguished public employment from employment in the private sector. Higher standards in employment conditions were not only meant to counterbalance unilateral state power in setting employment conditions excluding or restricting the public workforce’s right to strike. Rather, public employment and the state as employer also served as a role model for employment in the private sector, through high standards in work and employment and the integration of groups disadvantaged in the private labour market, such as women, disabled persons, and migrants (Bach and Kessler 2007).

Irrespective of different historical, cultural, and social traditions in the formation of the public sector and the regulation of public employment in Western states, the above-mentioned specificities and the rising share of the public sector workforce during the ‘Golden Age’ coined public employment as a distinct form of employment and a core element of mature welfare states.² This post-war ‘Golden Age’ set the scene for changes in the public sector and in public employment from the 1980s onwards.

Cost pressures arising from the expansion of the welfare state and inherent in the labour-intensive service sector (Baumol 1967) on the one hand and a shift from Keynesianism to monetarism in public policymaking (Pierson 2001) on the other reframed the conception of the state towards the limits of state action. This new frame challenged the traditional organization and profile of the public sector and paved the way for a marketization of public services. This trend not only induced privatization of public infrastructure and services (Schneider et al. 2005) but also instigated a process of administrative restructuring in the remaining public sector, whereby decentralization became a new imperative and, most importantly, market mechanisms and incentive schemes were introduced to replace traditional bureaucratic procedures (Hood 1991). The reform toolkits summarized under the heading of New Public Management (NPM), next to decentralization, encompass a broad spectrum of measures. These range from the introduction of performance measurement, coordination of public policy by contract instead of hierarchy, and the introduction of market-type mechanisms for the provision of public services (for example, tendering) to considering citizens as customers and using quality improvement techniques (Pollitt and Bouckaert 2011). Some of these measures either directly or indirectly impact public employment, as they seek to reduce the historical particularity of the employment conditions in the public sector. In this context, business-oriented Human Resource Management (HRM), deemed to be more efficient than traditional bureaucratic procedures, has become an important driver of reforming employment regulation and personnel politics in the public sector (Derlien and Peters 2008, pp. 5f; Bach and Bordogna 2011).

The research challenge

These public sector reforms and concurrent changes in public employment since the 1990s have been widely analysed in public administration research. However, what is missing in this field, as well as in sociology and political science, is a comparative perspective focusing on the specific role of the state as employer. Moreover, irrespective of valuable insights from this rich body of research, there are still open questions to be addressed regarding a generalization of reform paths and reform impact on employment. Moreover, there is a bias in favour of general government.

Undoubtedly, the NPM doctrine, promoted not least by the OECD and by the market-making and deficit regulation policies of the EU, has become a powerful reform influence, spreading from the Anglo-American world to countries with more entrenched bureaucracies in continental Europe, such as Germany and France. There is rich evidence that common trends of public sector reform include: privatization of public infrastructure; cost containment with respect to public sector spending; downsizing of the public sector workforce; and decentralization (Schneider et al. 2005; Pollitt and Bouckaert 2011; OECD 2009, 2011; Bach and Kessler 2007; Vaughan-Whitehead 2013). However, common trends in internal restructuring of public administrations are more difficult to identify. While the doctrine’s proponents claim that the NPM orientation marks a universal shift in organizing public administration and services, the scholarly debate yields no clear results either with respect to the universality of the reform path or with the direction and extent of change.

Irrespective of some core elements of bureaucratic organization, such as the legal entrenchment of administration and the existence of a civil service, comparative public administration research shows that Western states differ in public administration traditions with varying levels of openness to NPM reforms (Pollitt and Bouckaert 2011). Comparative research identifies a variety of reform strategies and differences in scope and timing of reforms, suggesting that equal exposure to budgetary pressures and the availability of NPM as a powerful reform script do not necessarily generate convergence in public administration patterns, even in the longer run (Derlien and Peters 2008; Demmke and Moilanen 2010). In an attempt to typify the logic underlying the variety of administrative reform trajectories across Western countries, Pollitt and Bouckaert suggest differentiating between two ideal type models based on different principles of coordination: the New Public Management (NPM) model favouring market mechanisms; and the Neo-Weberian State (NWS) model adhering to a professionalized and consultative form of hierarchy, reaffirming strong roles of the state and administrative law, and preserving the distinct status of the public service (Pollitt and Bouckaert 2011, pp. 208f). This distinction helps to capture the openness of the common law, Anglo-American country family towards NPM, in contrast to the more hesitant and incremental reform agenda in the legally highly entrenched bureaucracy of civil law countries such as Germany and France. However, as the example of Sweden shows, this distinction might not fit for all civil law countries, since reforms of a kind that would nowadays be identified as NPM, including the abolishment of the civil servant status, were already taking place in Sweden from the 1960s onwards. Hence, there is substantial variation in administrative reform in countries qualifying as Neo-Weberian, and reference to a common civil law background might not suffice to identify specificities of reform trajectories affecting public employment. This suggests that we need to explore in more detail the reform trajectories within the NWS family.

With regard to the impact of public sector reform on employment, comparative and country case study research on public sector reforms in Western states throughout the last decades has provided rich insights into core features and the variety of change. Numerous studies from the 1990s onwards identified a more or less negative effect of privatization and decentralization of public services and infrastructure on the size and conditions of the public sector workforce (Farnham and Horton 1996; Rothenbacher 1997; Cusack et al. 1989; Suleiman 2003; Bach et al. 1999; OECD 2008). Similar findings result from more recent research on the impact of government austerity measures (Bach and Bordogna 2013; Vaughan-Whitehead 2013; Demmke and Moilanen 2013). However, there is also evidence that public sector reforms motivated by NPM-related ideas have more diverse outcomes, and a uniform trend of decline of public employment across the OECD, as well as a general negative effect of administrative reforms on public sector employment conditions, has been contested (Derlien and Peters 2008; OECD 2009, 2011; Pollitt and Bouckaert 2011).

Among other reasons impeding an easy settlement, a crucial problem in this debate is the assumption underlying most contributions that public management reforms more or less directly translate into changes in public sector work and employment. This assumption is, however, implausible for two reasons. First, the NPM agenda encompasses a wide spectrum of measures, of which only some directly address the size of employment and HRM: downsizing via privatization; attenuation or abolition of the civil servant status with respect to tenure, seniority, or career pathways; or the introduction of performance-related pay. Other measures refer to the governance and organization of administration and public service (that is, decentralization, coordination by contract instead of hierarchy, and market-type mechanisms for the provision of services), the impact of which is rather indirect on work and employment (Pollitt and Bouckaert 2011; Bach and Bordogna 2011).

Second, public sector reforms, as other reforms, unfold in institutional- and actor-specific contexts rather than providing a script with a uniform imprint. Whether, and to what extent, the concrete reform profile and implementation induces institutional change is an open question (Crouch 2005). Thus, the connection between public sector reform and public employment and/or public sector work might be more contingent than is often assumed (Ashworth and Entwistle 2011). Therefore, rather than postulating a relationship between administrative reform and employment, the basic underlying structures – that is, the relationship between administrative regimes and employment regimes – must be investigated in order to better understand diverse or similar outcomes of change. This will also help to answer the broader question of whether common challenges lead to similar reform trajectories and result in more homogenous public employment regimes.

In comparative public administration research, structures and changes in employment in the public sector have usually been addressed with a strong focus on the civil service, generating rich evidence on the specific nature, development, and variety of civil service systems throughout Europe and the OECD world (Bekke and van der Meer 2000; van der Meer 2011, Raadschelders et al. 2007; Derlien and Peters 2008; Demmke and Moilanen 2010). Inherent to this focus is a special interest in government employment and bureaucrats, strengthened not least by the NPM paradigm, which prominently features the strategic role of managers and top-level bureaucrats (Farnham et al. 1996; OECD 2010; Hammerschmid et al. 2015). However, in most countries, employment in the public sector is much broader than the civil service category suggests. It often embodies different categories of the workforce, of whom civil servants with a distinct status might represent a core but not the whole spectrum. Moreover, some aspects of the traditional civil servant status during the ‘Golden Age’ of the welfare state have been extended to the growing public workforce, while others were abandoned, thus creating more hybrid forms of employment than the Weberian ideal type bureaucrat suggests. As privatization, decentralization, and administrative reform show, not only are the civil service or government employees exposed to change, but so is the broader public workforce, suggesting that research should reflect the whole spectrum of the public sector workforce.

In comparative public administrative and industrial relations research, we also find two somewhat contradicting but not mutually exclusive trends. We can either assume that NPM-inspired public sector reforms and budgetary restrictions impact public employment regulation as a whole, reflecting the strategic importance, political interest, and far-reaching goals in the changes of public service management (OECD 2008; Keller 2010; Vaughan-Whitehead 2013; Bach and Bordogna 2013). Or we can observe a preference for investigating employment changes in specific public services (for example, soci...

Table of contents

• Cover
• Title
• 1  Introduction
• Part I  Approach and Research Design
• Part II  Cross-Country Analysis
• Part III  Sector Studies
• Part IV  Summary and Conclusions
• Appendices
• Notes
• References
• Index