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Industrial & Organisational : Introduction : Personnel : Organizational psychology : Occupations: Work environment: Index : Outline

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Occupational psychology
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Industrial & organizational psychology

Job security has different meanings according to the employment laws of each country. A worker in Continental Europe, if asked about his job security, would reply by naming the type of statutory employment contract he has, ranging from temporary (no job security) to indefinite (virtually equivalent to 'tenure' in US universities but across the whole economy).

In the US however, which has more flexible labor laws, it refers more to a worker's sense of having stability of maintaining a job resulting from the possession of special skills, seniority, though there are also safeguards provided in many collective agreements against unanticipated technical changes.

Job Security in the United States

In the aftermath of the dot com boom, computer related jobs have experienced a low job security. In the software world, the term job security sometimes refers to the practice of consciously designing software in a way that makes the software difficult to maintain without the original author (i.e., the author creates a degree of "job security" for themselves), usually at the expense of design quality.

A growing number of American men have dealt with their unemployment and feelings of job insecurity by not returning to work. In 1960 5% of men ages 30-55 were unemployed whereas roughly 13% were unemployed in 2006. [1] The New York Times attributes a large portion of this to blue collar and professional men refusing to work in jobs that they are overqualified for or don't provide adequate benefits in contrast to their previous jobs. [2] The increase in Americans starting their own business is partially a reaction to decreased job security.

Orthodontists, dentists, surgeons, physicians, and trial lawyers are some of the few professions that truly have a sense of job security. Their work cannot be outsourced and illegal immigrants do not put downward pressure on their wages (unlike construction workers and meatpackers).

Job security in Europe

The main difference vis-à-vis the United States is the system of indefinite contracts. In most European countries many employees have indefinite contracts which, whilst not guaranteeing a job for life, make it very difficult for the employer to get rid of an employee. Employees who have legally acquired these rights, for example because they have been with a company for two years continuously, can only be dismissed for disciplinary reasons (after a number of formal warnings and subject to independent appeal) or in the case of a company undergoing restucturing (subject to generous laws on redundancy payments and often with retraining paid for by the company). In Spain, for example, such employees are entitled to 45 days redundancy pay per year worked. The high cost of redundancy payments is in practise what gives employees job security.

Whilst employees who have such legally-binding indefinite contracts are in the enviable position of knowing that they (and their family) have complete financial security for the rest of their lives it is important to realise that these obligations work both ways. In some countries such as Germany a company may prevent an employee (whose occupational training they have paid for) from leaving to take up a better post elsewhere until compensation is agreed. Even an employee of a company which is known to be about to fold may find himself compelled to stay with the company until the end even if he is offered work with a different firm.

Every company will have a mix of employees on different types of contract. This depends on time employed rather than seniority. Indefinite contracts can also exist for seasonal work. These so-called discontinuous contracts mean that a hotel, for example, may dismiss its staff in the autumn, but it must take the same people back on again the following spring.

The proportion of the workforce on indefinite contracts has fallen across Europe in response to increased competition and globalization. Companies may sack an employee just before he reaches the two-year mark and then re-hire him as a new employee. Many economists argue that greater labour market flexibility is necessary but jobs which are not backed by an indefinite contract are still poorly-regarded in many European societies, often disparagingly described as "precarious" or "McJobs", even when the company has good prospects.

In less regulated European economies, such as the UK, it is much cheaper to sack permanent employees. In Britain, employees are only entitled to a legal minimum of one week's redundancy pay per year worked (one and a half weeks for workers over 40). Instead, private- and public-sector employees who feel they have been unfairly dismissed have the right to take the company to an Employment Tribunal in order to be re-instated or to obtain extra compensation. It is not necessary to go through the normal court system.

In all EU countries an employee retains his existing contractual rights if his company is taken over under the so-called TUPE (Transfer of Undertakings (Protection of Employment)) regulations so the years spent working for the old company would count when calculating redundancy payments, etc.

Job Security Score

A Job Security Score is a numerical expression based on a statistical analysis of a person's individual demographics, such as location, industry, and occupation, as well as external factors, such as technology, outsourcing, and overseas competition, which is captured in macroeconomic data and trends. Job Security Score represents the creditworthiness of an individual based on their ability-to-pay by predicting an individual’s probability of unemployment risk. It is similar to the Credit Score, which represents the creditworthiness of an individual based on their willingness-to-pay by evaluating an individual’s probability of paying debts in a timely manner.

The Job Security Score is a patent-pending payment risk scoring technology that was first developed by [3]Scorelogix, a pioneer in consumer risk analytics.

Job Security Index

Job Security Index is a measure of the nation’s job security level or unemployment risk, by location, occupation, and industry. Launched in February 2004 and published monthly since January 2006, Scorelogix Job Security Index™[4] is a snapshot of the nation’s job security level.

Scorelogix Job Security Index™ is based on an analysis of thousands of Job Security Scores™ for individuals across the nation and represents how global economic factors, internet and computers, international trade and competition, outsourcing, off-shoring, job migration, etc, impact e demand and supply of employment, job growth, and job security.

See also

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