Knowledge-based performance management
Marie Hansen, Director General of the Danish National Labour Market Authority
2
Agenda
1. Where are we - facts about the Danish labour market
2. Institutional framework for labour market policy
3. Knowledge-based performance management
4. Challenges for knowledge-based performance management
3
Share of population in jobs (%) Public deficits if no reforms (share of GDP)
Demographic challenges ahead – when 5 people retires, 4 people enter the labour force. Reforms are needed.
1. Where are we – facts about the Danish labour market
4
1. Where are we – facts about the Danish labour market
Source: Jobindsats.dk
Note: Permanent benefits: Early retirement, flexi-jobs and people waiting for a flexi-job. Ready for jobs: Unemployed benefit recipients and social benefit recipients who are ready for a job within three months (match 1). Not ready for a job or an active effort are: Social benefit recipients not ready for a job within three months (match 2) or not able to take part in activation (match 3). All series are in full time persons.
Focus on reducing the number on permanent public benefit
0
50.000
100.000
150.000
200.000
250.000
300.000
350.000
jan-04
apr-0
4jul-0
4okt-
04jan
-05
apr-0
5jul-0
5okt-
05jan
-06
apr-0
6jul-0
6okt-
06jan
-07
apr-0
7jul-0
7okt-
07jan
-08
apr-0
8jul-0
8okt-
08jan
-09
apr-0
9jul-0
9okt-
09jan
-10
apr-1
0jul-1
0okt-
10jan
-11
0
50.000
100.000
150.000
200.000
250.000
300.000
350.000
Permanent benefit recipients Ready for jobNot ready for job or an active effort Sickness benefit
5
From public benefits to jobs
Youth education
1. Where are we – facts about the Danish labour market
6
Minister for Employment
National Labour
Market Authority
Regional
Employment
Councils
91 Integrated job centres for all job-seekers (insured and uninsured)
Local
Employment
Councils
National
Employment
Council
98 municipalities
New structure since AugustNew structure since August 2009 2009
4 Employment regions
Full responsibility of the municipality, State subsidies
External service
providers
29 unemploymentInsurance funds
98 Social
Welfare offices
- Cash benefits
The Danish
Pensions Agency
2. Institutional framework for labour market policy
7
3. Knowledge based performance management
Today: ”It must be legal and financed”
Future:
“1. It must work”
“2. It must be legal and financed”
It works
-Legal
-Financed
10-15%
It is legal and financed
70-80%
(It does not work)
10-15%
1
1
2
3
8
3. Knowledge based performance management
Social benefit recipients Unemployment insurance benefit recipients
Share of people on public benefits for at least one year without an active effort, %
Source: National Labour Market Authority
An active effort has an effect on the labour supply
9
3. Knowledge-based performance management
Source: Ministry of Finance
An active effort has an effect on the labour supply
0
2
4
6
8
10
12
14
1990
1995
2000
2005
2010
Pro
cen
t
Faktisk ledighed
Strukturel ledighed
Per
cen
t
Structural unemployment
Actual unemployment
10
3. Knowledge-based performance management
Goals can only be achieved through combined national, regional and local effort
11
National management tools:
1. Legislation
2. Economic incentives
3. IT-systems
4. Dialogue
3. Knowledge-based performance management
12
3. Knowledge-based performance management
Examples: Legislation
National rules on job interviews: If age 30+: A job interview within three
months of unemployment and at least every three months
National rules on activation: If age 30+: A period of activation within 9
months of unemployment
13
3. Knowledge-based performance management
Municipality expenditures to public benefits
Examples: Economic incentives
Revenue depends on municipality tax
70 %
50 %
-40
-20
0
20
40
60
80
Passive unemployment and activationin guidance and upgrading of skills
Activation in work places/ordinary education
In a job
-40
-20
0
20
40
60
80
Municipality expenditures
14
3. Knowledge-based performance management
Examples: It-tools www.jobindsats.dk The information is available on internet
15
3. Knowledge-based performance management
Examples: Dialogue The Employment Regions are in continuous dialogue
with the job centres about goals, strategies, results and efforts. Social partners also discuss the local employment policy with the job centres.
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4. Challenges in the near future
Reduce bureaucratic rules
On-going adjustment to make sure that the economic incentives are working
Need for more knowledge about what works
Increase ownership among citizens better and more user oriented it-tools? increased use of free choice? economic incentives instead of legal rules?