The Economic Impact of Italian Market Reforms

Giovanna Maria Dora Dore

Published: December 2017

Italy’s labour market is highly segmented by gender and age with high labour costs, high rates of self-employment and undeclared work, high minimum wages, strong dismissal constraints and uneven job opportunities between Northern and Southern regions. Italy has experienced three decades of reforms aimed at liberalising its labour market, boosting competitiveness and introducing flexibility to address low productivity and weak employment dynamics. The 2014 Jobs Act is Italy’s latest market labour reforms aimed at rationalising employment protection legislation, improving the effectiveness of social protection and boosting female and youth participation in the labour force. Labour market data for the first 18 months of the implementation of the Jobs Act point to positive upward trends for both employment and job creation as well as to a decrease in unemployment.