SO INGRAINED is the dream of the “posto fisso” in Italian culture, that the highest-grossing film of 2016 was a comedy about a man who stops at nothing to keep his permanent job in the country’s public bureaucracy. A series of reforms in recent years has liberalised Italy’s labour market. On July 2nd the government introduced legislation which changes tack.

The “dignity decree” aims to limit the prevalence of short-term job contracts and of firms shifting jobs abroad and simplifies some fiscal rules. (It also bans advertising of gambling, except for government-run lotteries). Businesses are livid; unions have offered mild praise. But the real impact on the job market may be less than its political effect.

The reform is the first big bit of legislation by the month-old government, an uneasy coalition between the anti-establishment Five Star Movement, led by Luigi Di Maio, and Matteo Salvini’s right-wing League. It is the brainchild of Mr Di Maio, minister…Continue reading
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