Social Europe

  • EU Forward Project
  • YouTube
  • Podcast
  • Books
  • Newsletter
  • Membership

Welfare states need reinforcement, not reinvention

Silja Häusermann and Jane Gingrich 18th June 2020

Old ideas about welfare are not broken—but the politics sustaining them is in peril.

welfare, welfare states, welfare institutions
Silja Häusermann

Do European welfare states need a post-pandemic reinvention? As cautious steps are taken towards reopening national economies, the answers to this question are increasingly polarised.

In one corner are calls to raise taxes and cut spending to pay for recent outlays. In another are appeals for a radical restructuring of support along the lines of a universal basic income.

welfare, welfare states, welfare institutions
Jane Gingrich

Despite the claim that Covid-19 ‘changes everything’, one of the key lessons of the crisis is that expansive welfare states work. Defending existing systems of social protection may be less glamorous than calling for their reinvention. The task has however never been more urgent, as the politics sustaining these institutions is in peril.

Good institutions

No welfare and labour-market institutions can—or should—be constructed to withstand a mass halt of economic activity. Rather, good welfare institutions can do two things.

First, by investing in public services, and citizens’ health and skills, they can create a ‘stock’ of resources which allow citizens more capacity to weather shocks. Secondly, through social protection and redistribution, they can flexibly redeploy a ‘flow’ of resources to address needs in moments of crisis.

This crisis, as those before it, has exacerbated inequalities. European countries with strong labour-market and welfare institutions have been the most resilient, saving lives and jobs. By contrast, the most severe distress from the lockdown has followed from the absence of effective social policies.

Nearly all middle-class professionals—outside the health sector—have spent months sheltering at home. By contrast, many manual workers have continued to work outside the home. While there is much we do not know about the nature of the virus, there is evidence that these workers have faced far greater health risks. In the UK, work by the Office for National Statistics shows that, among the working population, members of ethnic minorities and men in manual occupations have had a greater risk of dying from Covid-19.

These same workers have also faced more economic risks, especially in countries with less social support. Data from Eurostat show that, on the eve of the crisis, only one-fifth of Danish respondents reported they would be unable to face unexpected financial expenses, compared with one-third of UK respondents and close to half of Greeks.

Economic insecurity

These pre-pandemic differences have shaped the resilience of workers during it. Abigail Adams-Prassl and colleagues have found that the gap in economic insecurity between manual and non-manual workers is larger in the US and the UK, with their limited welfare states, than in Germany.

Not only workers have experienced stark divides in welfare policy. For the elderly, care homes with unsafe working conditions have been particularly risky. This vulnerability is exacerbated in those countries with limited investments in the care workforce and weak links between the health and care systems.

For children, the shock of school closures has revealed unequal safety nets for everyday needs. In countries such as the UK, the crisis has led governments to extend emergency food policies. Such need is less extensive where other mechanisms exist to address child poverty.

Social support

Countries with more extensive social protection have also been better able to redirect the flow of resources to meet new needs. Crucially, this has involved social support linked to the labour force.

The long-established short-time work schemes in Denmark and Germany, among others, have cushioned the blow of large-scale economic shocks. By contrast, countries with weak unemployment benefits or large groups of temporary or informal workers have had to create new benefits rapidly.

‘Gig’ workers and the self-employed have been particularly vulnerable. These workers often do not pay for, or receive, benefits, leaving governments scrambling to cover them. Yet they are more prevalent in the countries with weak unemployment systems.

Where governments have had to invent programmes to fill the most pressing ‘holes’ in existing protection, they have often lacked the state capacity to deploy them effectively—short-term work schemes and social assistance in southern Europe have been slow to reach workers. And while new minimum-income schemes in more limited welfare states are welcome, where strong unemployment and labour-market institutions already exist, governments have not needed to create them.

Undermining success

Jettisoning traditional welfare, either through austerity or severing the link between welfare and the labour market through a universal basic income, would undermine these successes. The task post-Covid-19 is to strengthen—not reinvent—inclusive social policies. This sounds like a moderate battle cry for future welfare politics—but only at first glance.

The lessons of past crises suggest that these same institutions may be deeply vulnerable to backlash in gloomy economic times. During crises, economic grievances and fear tend to reduce solidarity, particularly towards vulnerable groups: minorities, immigrants and precarious workers.

In a context of fiscal constraint, European publics may push governments towards prioritising the needs of the louder, well-organised and powerful voices. This push can lead towards precisely the porous and fragmented welfare states, with limited labour-market links, which have faced the greatest challenges.

Quickly crushed

The good news is that there is no need to reinvent the welfare state around revolutionary concepts such as a universal basic income. Beyond the inefficiency of this instrument, any such initiative would be crushed quickly in a context of exacerbated austerity.

The less good news, however, is that defending the ‘old’ policies creating stock and enabling flow may be difficult politically. If the politicisation of welfare follows the now entrenched divisions of European politics—minorities versus workers, ‘cosmopolitan elites’ versus ‘nationalist people’, highly-skilled professionals versus those in routine jobs—not much improvement is to be expected.

But if the experiences of the crisis heighten collective awareness of how effective inclusive welfare institutions can be, there may be cause for optimism.

Silja Häusermann and Jane Gingrich

Silja Häusermann is professor of political science at the University of Zurich. She is a co-editor of The Politics of Advanced Capitalism (Cambridge University Press, 2015) and of the forthcoming The World Politics of Social Investment (Oxford University Press). Jane Gingrich is an associate professor of comparative political economy at the University of Oxford. She works on welfare reform, education policy and preferences. She is a member of the CIFAR Innovation, Equity and Prosperity working group.

Harvard University Press Advertisement

Social Europe Ad - Promoting European social policies

We need your help.

Support Social Europe for less than €5 per month and help keep our content freely accessible to everyone. Your support empowers independent publishing and drives the conversations that matter. Thank you very much!

Social Europe Membership

Click here to become a member

Most Recent Articles

09d21a9 The Future of Social Democracy: How the German SPD can Win AgainHenning Meyer
u42198346 How Trump’s Tariff Regime Fuels Global OligarchyGabriel Zucman
u421983462 041df6feef0a 3 Universities Under Siege: A Global Reckoning for Higher EducationManuel Muñiz
u4219836ab582 af42 4743 a271 a4f423d1926d 0 How Trade Unions Can Champion Solidarity in Europe’s Migration DebateNeva Löw
u421983467298feb62884 0 The Weak Strongman: How Trump’s Presidency Emboldens America’s EnemiesTimothy Snyder

Most Popular Articles

u4219834647f 0894ae7ca865 3 Europe’s Businesses Face a Quiet Takeover as US Investors CapitaliseTej Gonza and Timothée Duverger
u4219834674930082ba55 0 Portugal’s Political Earthquake: Centrist Grip Crumbles, Right AscendsEmanuel Ferreira
u421983467e58be8 81f2 4326 80f2 d452cfe9031e 1 “The Universities Are the Enemy”: Why Europe Must Act NowBartosz Rydliński
u42198346761805ea24 2 Trump’s ‘Golden Era’ Fades as European Allies Face Harsh New RealityFerenc Németh and Peter Kreko
startupsgovernment e1744799195663 Governments Are Not StartupsMariana Mazzucato
u421986cbef 2549 4e0c b6c4 b5bb01362b52 0 American SuicideJoschka Fischer
u42198346769d6584 1580 41fe 8c7d 3b9398aa5ec5 1 Why Trump Keeps Winning: The Truth No One AdmitsBo Rothstein
u421983467 a350a084 b098 4970 9834 739dc11b73a5 1 America Is About to Become the Next BrexitJ Bradford DeLong
u4219834676ba1b3a2 b4e1 4c79 960b 6770c60533fa 1 The End of the ‘West’ and Europe’s FutureGuillaume Duval
u421983462e c2ec 4dd2 90a4 b9cfb6856465 1 The Transatlantic Alliance Is Dying—What Comes Next for Europe?Frank Hoffer

S&D Group in the European Parliament advertisement

Cohesion Policy

S&D Position Paper on Cohesion Policy post-2027: a resilient future for European territorial equity”,

Cohesion Policy aims to promote harmonious development and reduce economic, social and territorial disparities between the regions of the Union, and the backwardness of the least favoured regions with a particular focus on rural areas, areas affected by industrial transition and regions suffering from severe and permanent natural or demographic handicaps, such as outermost regions, regions with very low population density, islands, cross-border and mountain regions.

READ THE FULL POSITION PAPER HERE

ETUI advertisement

HESA Magazine Cover

What kind of impact is artificial intelligence (AI) having, or likely to have, on the way we work and the conditions we work under? Discover the latest issue of HesaMag, the ETUI’s health and safety magazine, which considers this question from many angles.

DOWNLOAD HERE

Eurofound advertisement

Ageing workforce
How are minimum wage levels changing in Europe?

In a new Eurofound Talks podcast episode, host Mary McCaughey speaks with Eurofound expert Carlos Vacas Soriano about recent changes to minimum wages in Europe and their implications.

Listeners can delve into the intricacies of Europe's minimum wage dynamics and the driving factors behind these shifts. The conversation also highlights the broader effects of minimum wage changes on income inequality and gender equality.

Listen to the episode for free. Also make sure to subscribe to Eurofound Talks so you don’t miss an episode!

LISTEN NOW

Foundation for European Progressive Studies Advertisement

Spring Issues

The Spring issue of The Progressive Post is out!


Since President Trump’s inauguration, the US – hitherto the cornerstone of Western security – is destabilising the world order it helped to build. The US security umbrella is apparently closing on Europe, Ukraine finds itself less and less protected, and the traditional defender of free trade is now shutting the door to foreign goods, sending stock markets on a rollercoaster. How will the European Union respond to this dramatic landscape change? .


Among this issue’s highlights, we discuss European defence strategies, assess how the US president's recent announcements will impact international trade and explore the risks  and opportunities that algorithms pose for workers.


READ THE MAGAZINE

Hans Böckler Stiftung Advertisement

WSI Report

WSI Minimum Wage Report 2025

The trend towards significant nominal minimum wage increases is continuing this year. In view of falling inflation rates, this translates into a sizeable increase in purchasing power for minimum wage earners in most European countries. The background to this is the implementation of the European Minimum Wage Directive, which has led to a reorientation of minimum wage policy in many countries and is thus boosting the dynamics of minimum wages. Most EU countries are now following the reference values for adequate minimum wages enshrined in the directive, which are 60% of the median wage or 50 % of the average wage. However, for Germany, a structural increase is still necessary to make progress towards an adequate minimum wage.

DOWNLOAD HERE

Social Europe

Our Mission

Team

Article Submission

Advertisements

Membership

Social Europe Archives

Themes Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

Miscellaneous

RSS Feed

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641