Economy of Italy - Labor

Labor

Following the 2003 "Biagi law", a controversial labour reform, unemployment has been steadily decreasing, reaching 6.2% in 2007, the lowest rate since the 1970s. In the south the average unemployment rate is far higher than the national average, but, in recent years, progress was made nonetheless, with the unemployment rate falling from 23.7% in 1999 to 11.2% in 2007 for Campania, and from 24.5% to 13% for Sicily. There is a significant underground economy, especially in the south where it partially offsets the high official unemployment rate, absorbing substantial numbers of people, working for low wages and without standard social benefits and protections. Italy maintains a good self employment rate at 25.5%.

Unions claim to represent 40% of the work force. Most Italian unions are grouped in three major confederations: the CGIL, the CISL, and the UIL, which together claim 35% of the work force. These confederations formerly were associated with important political parties (respectively the Italian Communist Party, the Christian Democracy and the Italian Socialist Party), but they have formally terminated such ties. Nowadays, the three often coordinate their positions before confronting management or lobbying the government. The three major confederations have an important consultative role on national social and economic issues.

Among their major agreements are a 4-year wage moderation agreement signed in 1993, a reform of the pension system in 1995, and an employment pact, introducing steps for labor market flexibility in economically depressed areas, in 1996. The CGIL, CISL, and UIL are affiliates of the International Trade Union Confederation. Of the three unions, CGIL is the strongest in numbers. CGIL once single-handedly organized a three-million people rally in Rome. Italy's employers are represented by Confindustria, the Italian Employers' Federation.

The average standard of living in Italy is very high. As noted by Mario B. Mignone

“In the official economy, the Italian worker is well rewarded with high wages, good benefits, and many paid holidays, but he or she cannot escape from the heavy burden of taxes.”