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2016 Conference Presentation

Equity Italy

7 September 2016

The impact of elderly care services in-kind on poverty across Italian regions and evidence of the effects of the recent economic crisis

Sara Picchi, University of Rome Sapienza, Italy


Over the past ten years in Italy, Spain and France, the demographic pressure and the increasing women’s participation in labour market have fuelled the expansion of the private provision of domestic and care services. In order to ensure the difficult balance between affordability, quality and job creation, each countries’ response has been different. France has developed policies to sustain the demand side introducing instruments such as vouchers and fiscal schemes, since the mid of the 2000s. Massive public funding has contributed to foster a regular market of domestic and care services and France is often presented as a ‘best practices’ of those policies aimed at encouraging a regular private sector. Conversely in Italy and Spain, the development of a private domestic and care market has been mostly uncontrolled and without a coherent institutional design: the osmosis between a large informal market and the regular private care sector has been ensured on the supply side by migrant workers’ regularizations or the introduction of new employment regulations.

The analysis presented in this paper aims to describe the response of these different policies to the challenges imposed by the current economic crisis. In dealing with the retrenchment of public expenditure and the reduced households’ purchasing power, Italy, Spain and France are experiencing greater difficulties in ensuring a regular private sector of domestic and care services. In light of that, the paper analyses the recent economic conjuncture presenting some assumptions about the future risk of deeper inequalities rising along with the increase of the process of marketization of domestic and care services in all the countries under analysis. In particular, after a brief description of Irvesen and Wren’s trilemma, the paper describes: recent state-interventions, since the beginning of the economic crisis, to promote the private employment of workers in the field of domestic and care services; and the performance of the domestic and care sector during the period of economic recession, paying particular attention to the evolution of highly skilled female employment.

The analysis carried out in this paper suggests that during the economic recession, the trade-off between wage inequalities, good service quality and the affordability of domestic and care work is likely to be overridden. Public services can represent an overly heavy burden on public finance, while a larger irregular domestic and care private market as well as fiscal policies can contain the (wage) cost of services. All other conditions remaining constant, this would ensure the resilience of the private provision of domestic and care services, as well as the relatively positive female labour market outcomes during the recession. On the other hand, this would also entail a greater wage dispersion in the composition of female employment. In light of that, the paper finally present some political implication.

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