The Rise of Structural Inactivity

One of the paradoxes of contemporary European welfare states is that while today practically every adult male and female seeks gainful employment, jobs are hard to come by. There is a growing number of (economically) inactive citizens, people of working age who are structurally dependent on social policy for their livelihood. The predicament of inactivity is concentrated among the low-skilled, ethnic minorities and the long-term unemployed. A comparison of ten countries, considering unemployment, sickness, occupational disability, maternity, general need and early retirement, in the age group between 15 years and the retirement age, reveals that levels of inactivity have dramatically increased over the past decade, except in the United States, where there has been a substantial decline (see Figure 1).

How do we explain the rise of structural inactivity in contemporary European welfare states? Are we living in a world of jobless growth? Do the citizens no longer wish to work? Do they, pampered by generous standards of social protection, prefer leisure? Or, are they sick or otherwise unable to work? In this paper, I wish to explore the rise of structural inactivity from two contrasting sets of arguments, both revolving around the ‘unintended’ or ‘perverse’ effects of postwar social policy.

The first argument, rooted in cultural sociology, centres around the alleged decline of the traditional work ethic in the welfare state. By having dissolved the ‘sacred’ link between work and income, the welfare state has come to undermine the motivation to seek gainful employment. The lack of immediate feedback between work and income, conservative critics of social policy contend, weakens the moral fibre of welfare recipients. The resultant rise in inactivity contributes to the emergence of a ‘dependency culture’ of benefit claimants.

While the causal chain of the decline of the work ethic argument runs from the behaviour of citizens to the rise of inactivity, the second argument, rooted in comparative political economy, suggests that the institutional characteristics of national labour markets and social security systems structure the level of inactivity. The crisis of inactivity, following this line of reasoning, is not the result of crippling norms and values, but rather the consequence of accumulated institutional rigidities and historically perverse policy choices.