Labour market segmentation: the economic condition of independent professionals in Italy and Argentina

Abstract

The article focuses on the conditions of self-employed professionals in the European and Latin American labour markets, whose increase is linked to the expansion of on-demand service economy. Moving from a critic to the traditional segmentation theory, this group of high-skilled self-employed, expression of the upper-middle class and post-industrial work can be considered halfway between market and hierarchy, HR internalization and outsourcing. Dealing with social inequalities, the research questions are whether the conditions of the independent professionals (namely “self-employers without employees” and “cuenta propia profesionales”, characterized on average by higher levels of education and who works in the advanced service sectors) are comparable with employees and whether in the two contexts (specifically Italy and Argentina) there are similar trends. The article investigates work income (as a dependent variable) to measure how it changes controlling for the occupation (self-employed or employee) and the socio-demographic characteristics (as independent variables). The comparison of income levels was realized by using two datasets: EPH-INDEC (Encuesta Permanente des Hogares) for Argentina and ITA-SILC for Italy. Despite the limits -due to problems of comparison in the classification of occupations- the analysis highlights differences between the two countries, linked to a dissimilar expansion of the service economy, professional services and outsourcing of high-skilled competences. Moreover, within a frame of a high income inequalities in self-employment, graduated independent professionals in Argentina seem to retain a stronger economic performance, while in Italy they show lower earnings than other occupations, suggesting an unequal labour market impact of higher education in the two countries.