Arbeitsbedingungen, Anforderungsprofil, Humankapital, Lohnniveau, Dienstleistungssektor, OECD-Staaten, Working conditions, Occupational profile, Human capital, Wage level, Service industry, OECD countries

Wolfgang Ochel

English

Research Papers in Economics

CESifo Forum 55
DICE Reports
SERVICES ARE DIFFERENT:
JOB CHARACTERISTICS,
WORKING CONDITIONS AND
PAY LEVELS IN OECD
COUNTRIES
The share of employment in services continued to
rise in virtually all OECD countries during the
1990s.This coincided with significant changes in the
types of jobs being created. The rise in the number
of “atypical” jobs, such as part-
time and temporary jobs has led
to a debate about the quality of
jobs, especially in the service
sector. Do job characteristics,
working conditions and pay lev-
els in the service sector differ
form those in the goods produc-
ing sector?
Job characteristics
On average of the OECD coun-
tries, part-time work is much
more common in the service
sector than in the goods produc-
ing sector. The incidence of
part-time work is highest in per-
sonal services (domestic ser-
vices, recreation and cultural
services, hotels and restaurants
etc.) and social services (see
Chart 1).
Temporary jobs are more even-
ly spread across both the
goods-producing and the ser-
vice sector. Within the service
sector, the incidence of tempo-
rary work in personal services is well above the
respective national average. It is also above the
national average in social services (education,
health etc) and in retail trade but lower in the
other distributive service sectors. Temporary
employment covers fixed-term contracts, seasonal
and casual work, and working on contract for a
temporary work agency. These different work
arrangements do not imply the same degree of pre-
cariousness (see Chart 1).
Another aspect of job quality is the average job
tenure which is measured by the length of time
DICE REPORTS*
* DICE = Database of Institutional
Comparison in Europe (www.cesifo.de).
Chart 1workers have been in their current job or with
their current employer. There may be a relation-
ship between a low turnover on the one hand and
higher earnings as well as job security on the other.
But not all long-tenure jobs are good jobs.Average
tenure is lower in the service sector than in the
goods-producing sector and is particularly low in
personal services (see Chart 1).
The incidence of continuing vocational training, an
indicator of opportunities for career development,
on the other hand, is higher in the service sector,
especially in producer services and social services.
One reason for the higher incidence of training in
the service sector may be the higher level of edu-
cational attainment of workers in this sector.
Another reason may be the greater retraining
requirements imposed by IT technology which is
intensively used by producer service firms and gov-
ernment agencies (see Chart 1).
Working conditions
The various job characteristics
described so far provide only
indirect measures of job quali-
ty. More direct measures are
provided by the European
Survey on Working Conditions.
Generally, working conditions
are less favourable in the
goods-producing sector than in
the service sector. Working
conditions and work tasks are
more unpleasant, work autono-
my is more limited and jobs are
perceived as less secure. Apart
from, “antisocial” hours of
work, the other aspects of
working conditions appear less
favourable, too (see Chart 2).
Within the service sector, the
hotel, restaurant, transport and
communications industries stand
out as generally having less
favourable working conditions
than other service industries. At
the other end of the scale, work-
ers in financial services and in
public administration appear to
have some of the most
favourable working conditions.
Pay levels
Another important job characteristic that is linked
to job quality is the rate of pay that is associated
with a job. Rates of pay are highly correlated with
the level of skill required in the job. Higher-paid
employees tend to have better working conditions
than lower-paid employees in the sense of working
in less physically demanding or noisy jobs and/or
with greater autonomy regarding their work
schedules.
Chart 3 provides earnings differentials of service
sectors relative to manufacturing in four OECD
countries. Average earnings in the service sector
are higher than in manufacturing in Australia,
around the same in France and the Netherlands
and lower in the United States.Within the service
sector, jobs in producer services record the high-
est average earnings in Australia and France,
CESifo Forum 56
DICE Reports
Chart 2CESifo Forum 57
DICE Reports
whereas social services pay best in Australia and
the Netherlands. Average earnings are lower in
distributive services and lower still in personal
services.
Conclusion
Comparisons of job quality, based on measures of
job characteristics, working conditions and pay,
reveal no simple dichotomy between the goods-
producing and the service sector. Good jobs are
not primarily located in the former and bad jobs in
the latter. Part-time work and temporary work are
more common in the service sector, average job
tenure is shorter, the incidence of continuing voca-
tional training is higher than in the goods-produc-
ing sector.Working conditions are more favourable
in the service sector. Average earnings are about
the same as in manufacturing (with the exceptions
of Australia and the United
States). Within the service sec-
tor, producer services and
social services have a higher job
quality than distributive and
personal services. Further dis-
aggregation reveals even more
pronounced differences in job
quality.
Wolfgang Ochel
Chart 3

Services are Different: Job Characteristics, Working Conditions and Pay Levels in OECD Countries

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Services are Different: Job Characteristics, Working Conditions and Pay Levels in OECD Countries

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