The Emerald Research Register for this journal is available at www.emeraldinsight.

com/researchregister

The current issue and full text archive of this journal is available at www.emeraldinsight.com/0309-0590.htm

Human resources policies compared

What can the EU and the USA learn from each other?
Eduardo Tome
Instituto Superior de Servico Social, Beja, Portugal
Abstract
Purpose To compare in a fruitful way the human resources (HR) policies that exist in the European Union (EU) and in the United States of America (USA). Nowadays, the world is evolving to a situation in which big economic spaces like Brazil, Russia, India, China, Japan, the EU and the USA are becoming dominant. Those spaces can learn from one another on how to guide their HR policies. The comparison between the EU and the USA is further justiable because the EU seeks to become the world leader by 2010, and is facing a strong neo-liberal ideological trend. Design/methodology/approach Having in mind the known theories on HR, the various types of welfare states that may underlie HR policies and also some basic questions regarding the practical organization of those policies are analyzed. Findings The EU comprises ve different types of welfare states, the USA one. Regarding specic aspects of HR policies, for example, the role of the Federal authority, redistribution, eligibility and policy priorities and the evaluation procedures, the USA has the edge over the EU. Research limitations/implications This is an initial work. Further analysis could be made both enlarging the analysis to another cases (Brazil, Russia, India, China, Japan) and trying to nd more specic and actual data on all the questions addressed. Practical implications Much caution should be taken in comparing HR practices, and transferring them, because E&T systems have historic roots and depend on the economic characteristics of the country in question. The EU should increase and improve its role in the command of HR policies in Europe. Originality/value An original study on the way of looking at the EUs HR policy framework and on the way of dealing with the question of the Americanization of the world, namely in the HR eld. Keywords European Union, Human resource strategies, United States of America, Strategic evaluation Paper type Conceptual paper

Human resources policies compared 405

Received July 2004 Revised October 2004 Accepted December 2004

Introduction There is little doubt that the twenty-rst century will be dominated by a knowledge-based economy (KBE); consequently, in the future, human resources (HR) will be absolutely fundamental for the well being of human societies. There is also little doubt nowadays that in the fore-coming economic landscape, some big economic blocs will presumably be very important, like the already strong EU, USA and Japan and the emerging BRICs, that is Brazil, Russia, India and China (Wilson and Purushothaman, 2003). It is also very interesting to note that of all those major players, all, except Japan, may be well be considered as continents and not as normal countries because they share some distinctive characteristics: very big population and area, federal structures in administrative and budgetary matters, a common currency, a common language and

Journal of European Industrial Training Vol. 29 No. 5, 2005 pp. 405-418 q Emerald Group Publishing Limited 0309-0590 DOI 10.1108/03090590510603432

JEIT 29,5

406

some common cultural values. And, if we admit that, rstly, English is already an essential passport language in the EU and that, secondly, in the future, the EURO may be expanded to almost all the new EU incumbents, we may well consider that the EU may qualify as a continent in the making. Consequently, in this paper, the HR policies that exist in the two more highly developed continents in the world, that is the EU and the USA, will be analysed and compared, in order to extract some useful lessons on the optimal way to conduct HR policies in a continent. Main theoretical ideas This section will comprehend a brief description of the main economic, managerial, and sociologic ideas linked with education, training and HR. Those theories describe the logic that is present in the behaviour of individuals, companies, organizations, the state, and the society as a whole. This section is important as a basis to the analysis that will be made in the rest of the paper. Economists have few doubts about the pertinence of HR as a positive factor to the situation of individuals, companies, organizations, the state and societies as a whole. Regarding this specic topic, the history of economic ideas went through something like a three-stages evolution: (1) Before the twentieth century, manpower was essentially viewed as quantitative and unskilled, and even if great economists like Adam Smith (Paul, 1989, p. 58-9) or Stuart Mill (Shackleton, 1995, p. 10) were aware that skills had positive repercussions in society. (2) In the twentieth century the human capital theory (HCT) decisively demonstrated the qualitative aspect of skilled labour as an enhancer of wages, prots, productivity, quality, and welfare that, accrued, respectively, to individuals, companies, the state and the society (see among others Becker, 1980; McConnell and Brue, 1989); those ideas may be conrmed by basic statistics (United Nations, 2003) and also by microeconometric studies (see European Commission (2003) on education and Heckman et al. (1999) on training). (3) In the twenty-rst century, with the emergence of a KBE HR became a central topic in the vast notion of intellectual capital (IC) (Mortensen, 2000); it is also increasingly clear that IC has a effect in societies, as it is shown by some elementary statistics, that relate the national level of IC components with the development level of countries (Table I); some empirical studies on companies, made with a management perspective (Skyrme, 2003) and using well-known methods (Sveiby, 2002) also conrm the societal importance of IC. The public intervention in the HR market was also widely studied. Nowadays it seems decisive to balance market failures and government failures. There is little doubt that some public intervention is needed in many cases, in which, due to external positive effects of HR, a social prot exists, that is much higher than the private benet. Equity concerns and social stability also may recommend public intervention. With his pioneering study on Scientic Management, Taylor (1964) made the major founding work in the Sociology of Work and in human resources management (HRM) eld. Taylors organization principles (centralization, separation between knowledge and execution, one best way, polarization, formality and prevalence of

Low income GDP per head (dollars PPP) Population (millions) Life expectancy (years) Under 5 mortality (per cent) Adult illiteracy (per cent) Energy consumption (kwht) Paved roads (per cent) Internet users (per 10,000 hab) 2,040 2,511 59 115 37 357 19 0.4

Low middle income 5,020 2,164 69 42 15 1,042 44 3

Upper middle income 8,730 504 71 30 10 2,434 47 36

High income 27,680 955 78 7 0 8,238 94 777

Human resources policies compared 407

Notes: GDP Gross Domestic Product; PPP Power Purchase Parities; Data on energy consumption, paved roads, and internet are from the 2001 report, on the same classes Source: World Bank (2003)

Table I. Development differences in the world (2001)

writings over oral commands) are well known. It is important to extract from those principles four main ideas regarding skills and their economic and social importance: (1) Human skills and organizational competences are essential to the development of any company. (2) The skills pyramid has a small top and large base. (3) Knowledge is essentially possessed by the small group at the top. (4) The small top group members should be highly rewarded because they possess a very important asset: knowledge. After that, in all the twentieth century, many complementary analysis were made on the Sociology of Work and on HRM. As a result of all those studies, virtually a mosaic of experiences and theoretical ideas exists nowadays, about the right way to manage HR and about the sociologic aspect of HR. And, it is interesting to note two main features of those analysis: (1) They differ in the receipt they give on the best way to manage HR. (2) They agree in the centrality of HR in every economy and society. The rst idea derives from the fact that authors are almost permanently nding new explanatory variables, and presenting new case studies, which do not t in the already known theories, and that result the improvement of those theories. But the second idea is generated by the fact that, of all the aspects the new theories address, like human relations, and culture, one (technology) became really important with the third Industrial Revolution. In fact, the Big Mutation (Richonnier, 1985) that effectively transformed the developed world, resulted in three major changes regarding skills: (1) In the most performing organizations of the end of the twentieth century; Taylors principles were put in question, adapted or even radically changed. (2) The skills regarded to be needed also changed, passing from repetitive and hard competences (like typing), to creative and soft ones (like text making). (3) The optimal skills pyramid was also transformed, becoming progressively wider at the top and narrow at the bottom.

JEIT 29,5

408

The evolution just described was even speeded up in the 1990s, with the advent of the so-called information society, in which knowledge is the fundamental asset, being possessed by IC owners. Nowadays, knowledge management (KM), is the new face of HRM, as IC is the new face of HC. As a literature synthesis, it may be said that, the most important authors in the elds of HR Economics, HR Management and KM, agree that in the twenty-rst century; . human beings, in all their immense complexity, and diversity, are the most important factor of prosperity; and . much action is needed to deal with the emergence of the KBE, both in what concerns the research practices and in what concerns the development of policies. Denition of an important question The world economy to which the theories that were just mentioned apply to and in which the researchers that build those theories live, is not an even one. Quite on the contrary, nowadays, some very big economic, social and political entities are beginning to shape the world economy. Those entities are the USA, the EU, Japan, Brazil, Russia, China and India. As it was mentioned briey in the introduction of the paper, those are different but comparable entities, in what concerns the size, the administrative form and the economic, social and cultural ties that exist among their members. Within that context, the HR researcher may ask a very simple but pertinent question: how should the EUs HR policies be oriented? Methodology Possible answers to the question may be found comparing the EU case with the cases of the other six major players just listed. In this paper, only one of those comparisons will be made. There are two main reasons for that: (1) Time, space, and difculty of the task. This one is just a rst, try to solve the question and one that is made to t in a scientic paper, not in a book, or in several papers. (2) Interest. Anyway, given the current state of affairs regarding the HR policies in the EU (dened by the so-called Lisbon Strategy for the Employment that aims to put the EU ahead of the US as a leader of the KBE in 2010) and the current state of evolution of the EU (dened by the enlargement to 25 Member States in 2004 and by the discussion over governance in a further enlarged Union in the near future), makes that comparison a very logic one. Finally, one can add that the comparison with the USA can be important as a way of dealing with problem of the neo-liberal inuence (which is originated in the USA) in the EU and in the world: when and how should the Americans be copied? The HR researcher should also know that any HR policy is dened by a set of principles, which aim to solve a set of problems and that materialize in a set of practices. In this paper, the discussion over principles will be linked to the types of welfare states, the determination of problems will be linked with disparities and the analysis of practices will be linked with the place of a Federal Authority in the denition of those policies, with the rules regarding eligibility and policy priorities, with redistribution and with the evaluation procedures of those policies.

The study is further justied, given that it deals with the best way of shaping the EUs policies and given that nowadays governability is a key word in every discussion about the EUs present and future. Thus, having in mind his traditional scientic background, the HR researcher should try to go in a new, challenging and relevant topic that this paper tries to address. Data The analysis is grounded in two sets of data: (1) Known studies over the types of welfare states that exist in the EU and in the USA. (2) The available statistical data and scientic studies on the EUs and the USAs HR markets and policies.

Human resources policies compared 409

Analysis This section will present a summary of the main features that characterize the EUs and the USAs HR markets and the relevant HR policies. Five topics will be addressed: the type of welfare state and its causes, the disparities and the redistribution levels, the role of the Federal Authority, the policy priorities and the eligibility procedures, the evaluation practices. For each topic, important differences between the European case and the US case should easily become evident. On the type of welfare state and its causes In the USA: (1) In what concerns education (US Census Bureau, 2002), the public sector dominates the private sector, which is residual in elementary (3 per cent of the market) and high school (6 per cent), but important at the university level (20 per cent). (2) Regarding training, there is something like a divide in the market, between on one hand, worker training (US Congress Ofce Technology Assessment, 1990), and training for the disadvantaged (Policy Almanac, 2001) and, on the other hand between the public intervention and the private action. The Federal Government and the Federal States, promote some of the available training for workers, especially for civil servants and with economic purposes like skills upgrading, teamwork training and quality control; but most of the worker training is promoted by employers. Thus, the public sector intervention in the training market consists essentially in helping the disadvantaged with some type of vocational studies. This situation is very much in line with the denition of a Liberal Welfare State (Esping-Andersen, 1990; Ferrera et al., 2000), which relies in a strong private sector. That specic form of welfare state certainly has its roots in US history. The USA was a vast, almost empty land, where adventurous people from Europe began to arrive, rst at the time of the French Revolution, then as the nineteenth century unfolded. No ` ` Middle Ages, no Renaissance, not even Le Siecle des Lumieres there. So, a big chance

JEIT 29,5

410

existed to begin from scratch and to feel the appeal of liberty, and business. In addition, the USA was naturally well protected from its enemies, being almost a fortress in geographic terms. That environment easily gave birth to three main institutions: (1) The USA themselves as a single country that qualies as a continent. (2) A very liberal constitution. (3) An economy driven by a very strong and incisive private sector. So, the USA are a Liberal continent, with a Liberal HR market. Some crucial aspects of this market will be analysed in the next four paragraphs. In Europe, the situation is much more mixed, corresponding to the co-existence of a mosaic of several forms of welfare state (WS): Liberal, Conservative, Social Democratic (Esping-Andersen, 1990) Latin (Ferrera et al., 2000), and Marxist (Deacon, 2000). Those ve basic types of WS differ in three main aspects: (1) The strength of the private sector to provide the social services. (2) The ability of the society to pass without the public action. (3) The tradition of public sector intervention, its roots and its quality. Mainly, and most importantly, the WSs give different practical answers to the theoretical question whether public failures are worse, or better, than government failures. The ve situations existing in Europe can be described as follows: (1) In the UK, the situation is very much alike that of the USA, in what concerns the importance of the private sector in the provision of higher education (OECD, 2003) and on the role of public entities as producers of both basic education and of training for the disadvantaged (Department for Education and Employment, 1998). (2) In the Nordic countries (Norway, Sweden, Finland, Denmark), the public intervention is extremely deep rooted, as shown in record gures regarding expenses per student (Eurostat, 2003), the rate of public funding in education (OECD, 2003) and the level of active measures on the labour market (Eurostat, 2003). The quality of the public support to the unemployed is known to be very good: public services are interconnected with companies to prevent upcoming problems and the number of les/users per civil servant is relatively low. Furthermore, the private sector is also very committed to HR improvements, and those are the countries in which the gures on participation in training by companies and employees are higher (Eurostat, 2003). All those efforts originated a very prosperous economic and social situation, those countries being among the richest in the world (United Nations, 2003) and having (except Finland) relatively low levels of unemployment (Eurostat, 2003). (3) In the European Eastern countries, and from World War II to the fall of the Berlin Wall, the HR policy was framed in a socialist way. The investments in HR were essentially made by the public sector. Much basic investment was made in education and culture; consequently those countries rank very well in all international comparisons on education (United Nations, 2003). Training was also developed, although related to an economy in which difculties were increasingly bigger: thus, the training system became increasingly obsolete.

(4) In the Latin States from the South of Europe, private intervention in the E&T market has always been insufcient, those countries having traditionally the lowest gures regarding the participation of companies and employees in training (Eurostat, 2003). But, the public support to HM has clearly also not been enough: specially before the beginning of the European integration process, in the mid-1980s, those countries had low rates of public expenditure in education and training, which originated relatively low levels of school attainment (World Bank, 1986) and workers skills. Nowadays the situation is much improved (Eurostat, 2003) even if those countries are still at the bottom of the European scale regarding public expenditures in schooling. It is important to stress that the EU gave an enormous boost to those countries labour market policies, placing them at a level comparable to the other EU countries if the ESF support is taken into account, what, regrettably, seldom is the case in the traditional international statistics and even in EU ones like those of Eurostat (Eurostat, 2003). The conjugation of the two factors just mentioned originated a situation in which the HR structures were underdeveloped regarding the needs of modern and developed countries. Nowadays, hopefully, the catching up process, that began with the advent of the European integration process, is continuing. (5) Central European States developed strong E&T systems, in which the public promotion was decisive, and some mutual understanding between the employers and the unions was obtained. At the core of those systems was the interaction between the companies and the state: a good example of cooperation being the German dual apprenticeship system, which combined public guidance and private needs. Nowadays, the variables representing education and training investments (measured by skills levels and educational degrees Eurostat, 2003) and rewards (measured plainly by the average income levels United Nations, 2003) have not such good levels as those of the Nordic States but are higher than in the Latin countries. It is fundamental to note that each type of HR market just mentioned has its own social, economic and political origins, namely: . The UK, has some well known cultural characteristics in common with the USA, language and liberal tradition being two of the most important. . Social-democracies developed in small Nordic countries, dimension being very probably a positive factor which favoured the quality of those countries public social organizations: small is not only beautiful but also sometimes is easier and best as well. In consequence, the idea (supported by those countries red unions) that the State was a common safety house for every citizen could be well materialized. Something like a virtuous cycle occurred: HR investments contributed to the development of social policies, which themselves enabled the main social classes of those societies to view the State has a main guarantee of rights and not has an obstacle or as a second source to their provision; when success became apparent, more HR investments were made, that strengthened those countries welfare levels.

Human resources policies compared 411

JEIT 29,5

412

Marxist regimes were politically imposed after WWII, in the Soviet dominated countries, and lasted the time of the socialist experiences; nowadays each country is trying to nd its way in the WSs puzzle, drifting towards the three main forms of WS: conservative, liberal, social Democratic. The twentieth century history of the Southern European countries was marked by right wing non-democratic and socially conservative dictatorships; as education, generally speaking, could led to rebellion, those regimes did not favour the development of HR structures; that shortfall in E&T in turn contributed to the economic retardedment of those countries and to social unbalances which, even today, after some years of strong economic growth that followed the adhesion to the EU, characterize the societies in question. Conservative regimes grew from the political concern of stopping the socialist menace, while maintaining democratic regimes and growing economies; the socialist class struggle was fought with some forms of social dialogue, which originated social policies in the making of which the main actors (the state, the workers and the rms) were compromised and linked. The huge importance of farmers, which considered the industrial labour force as an opponent, contributed to the development of that middle way system. Thus, as it happened in the Social Democratic and in the Marxist cases, in those countries strong HR systems were also developed, but the public intervention was not so decisive.

On the disparities and the redistribution levels Nowadays, the USA are the biggest economy in the world, and are at the top end in what concerns individual income and human development; but, inequalities are high, and the US Gini Index is of about 0.41, which is much higher than the Swede (0.25) (World Bank, 2003). However, if we consider the USA as a continent and compare it with the EU, the American picture looks certainly brighter. In fact: . The discrepancies that exist among the 27 future Member States of the EU, are bigger than those that exist among the 50 US States. In 2001, in the USA the lowest GDP per head for a Federative State was of around $21,600, and the highest one of $42,000, the average being $30,300 (US Census Bureau, 2002). In the EU27, in 1999, 13 countries had gures higher than $19,000 in purchase power parities, and six countries (including Poland and Romania, the sixth and seventh biggest countries in dimension from EU27) had gures lower than $10,000 (The Economist, 2003). . The Federal Government commits about 3 per cent of the US GDP to support the States (US Census Bureau, 2002), whereas the EU spends and intends to spend, only around 0.5-1 per cent of its GDP on helping its poorer and more needed regions. Given that the economic and social development is made with physical capital, and nances, but also with human and IC, some basis exists then to reinforce the EU level of redistribution and even, to nance that redistribution by an European tax, if needed. That policy reinforcement would mean that the HR EU policy should be much increased in the near future.

On the role of the federal authority In the USA, the Federal Government plays a central role in the denition and funding of the policies on HR. That activity is essentially made through the Department of Labour, the Department of Education, and the Department of Health and Human Services. In fact: . most of the US central legislation on E&T has a Federal origin; and . the Federal Government usually launches programs, which are complemented by those made by the Federative States. In Europe, the European Commission has only a subsidiary role in the denition and funding of the European policies. That happens because, legally, subsidiarity is a key word in all the EU social practices, being one of the main principles established in the Treaty of Rome after the Maastricht revision, and having been conrmed in the Treaties of Amsterdam and Nice, and in the constitution draft. Thus, the EU intervention regarding E&T can be described as follows: . Generic guidelines included in the main Treaties since Maastricht onwards. . Specic recommendations and rulings based on the work of the European Council, the Commission Directorate General on Employment, the Commission Directorate General on Education, the Council of Ministers on Education and the Council of Ministers on Employment; those recommendations and rulings cover areas like lifelong education, skills recognition, accreditation, skills transfers, certication of informal qualication, uniformity of university degrees, use of technologies in education. . Funding of programs, related with education, training and science, as those administrated by the European Social Fund, pursued in a national basis, or those like Erasmus, Leonardo and Socrates, which by nature are transnational. So, in the EU: . National governments are responsible by almost all the HR sector; specially in the education case, the existing exceptions, just conrming the subsidiarity rule. . Regarding the training market, and in some countries (like Portugal Ireland, Greece, Italy, Spain, and East Germany) the EU became extremely important, because the shortages were very big and because political reasons related to the economic and social situations of those countries implied a massive support to happen; very signicantly, in those cases, the doubt may be risen over if the EU was subsidiary, or if the EU itself became a relevant and permanent structure of those training markets. All indicators seem to point in the second direction, meaning that the EU only became crucial because the subsidiarity rule was broken. On the policy priorities and eligibility procedures In the USA, the Federal Government supports basic education and training for namely, civil servants, welfare recipients, other poor adults, youth and workers who have lost their jobs due to foreign trade. So, much concern is put on the situation of the recipients, be them schoolboys and their families (in the case of education), or people in trouble (in the case of training). In addition, the States give some support to worker

Human resources policies compared 413

JEIT 29,5

414

training in companies, regarding problems like group training, skills upgrading, quality control and management supervision. In the EU, on education, a very large set of different national policies coexist, which try to provide almost free of charge schooling for everybody until, at least the end of the University; specically on higher education, whereas in the USA, some very expensive universities exist that receive a considerable share of students, in the EU governments try to subsidize the schools and maximize the attendance. In the EU, on training, the most developed European countries had, since World War II, their own well established structures; appearing over that picture, the programs funded by the EU have been done in a considerable regional basis, at the EU level, in order to support lagged regions or regions in industrial decline. This situation has some implications: . the EU support is much more wide than the one which is given by the Federal Government in the USA; . the USA relies more on the market, than the EU; and . the USA seems to detect more accurately those who need the funds, whereas the EU is more interested in those who need training. On evaluation practices Evaluations on education have been made since the 1960s, in the EU and in the USA, with good results (for a last update, see European Commission (2003)). On training, in the USA, ne microeconometric evaluation practices have been made since the 1970s, regarding the bigger public programs made since 1962, and also on some private programs (Heckman et al., 1999; OECD, 1998). That evaluation activity was brought about, because resources were seen as own ones that need to be assessed. In the EU, some important evaluation practices on training exist since the 1980s, related to the more developed countries, like Sweden, Finland, the UK and Germany. In what concerns the EU funded programs, however, ne evaluation procedures are only common since the 1990s; until then, those programs were only evaluated using raw nancial and physical gures; that happened because the dominating idea was that funds must be spent, trying to solve regional problems, recipient regions being seen as obvious beneciaries (Tome, 2001). Discussion The analysis just presented may be discussed in some perspectives, namely the following: best practices, implications for HR policies, research limitations, implications for future research. Each one of this subjects will be dealt with in this section. Best practices Regarding the effects on HR performance, the Nordic system of welfare state may be considered a best practice and a benchmark situation in itself. In fact, the way those countries organize their labour market policies, based on highly developed and professional public services, which are able to deal with the market evolution and guarantee the continuation of high standards in the HR eld, is enviable by all the other countries in the world. However, even that idea should be not taken without

caution. The Nordic system is in itself difcult to transplant; its complexity, means it is easier to apply it to small countries and the progress from another form of WS to a social democratic situation requires much public spending, which is something that, due to the need to observe a certain level of budgetary equilibriums, can only be achieved in the long run. The Nordic case is also a very strong and important case on the relation between HR policies, disparities and redistribution, making very clear that equality is only achieved with public policies of high quality and intensity. When compared with the EU case, the US case of central command of HR policies is certainly better, at least because the subsidiarity principle that guides the EUs actions, effectively puts severe limits to the level and scope of the EUs operations. And those limits clearly become a problem in the context of big economic spaces, which have high levels of disparities within themselves, and where a central authority is essential to guide and to help the poorer regions. Eligibility priorities and usually better dened in national HR schemes, but broad regional priorities may be justied in large economic spaces like the EU, as a way of balancing the economy. Anyway, the public support should be given when there is an evident need of HR funding, and not when there is a only need of E&T, which can be matched by the free market. Finally, on evaluation practices, the US experiences, that culminated with the awarding to James Heckman, of the 2001 Nobel Prize in Economics, are certainly a best practice case (see Heckman et al. (1999) and Ashenfelter and Lalonde (1996) for a good review of those studies). The important aspect of those analysis is that they discuss with detail the US experiences, from the 1960s to the 1990s, ending on the job training partnership act, and, in doing so, they provide much guidance to the best way of designing the evaluation of any HR program. Implications for HR policies At the EU level, this study would recommend a bigger role of the European Commission in the development of HR policies, a higher level of EU funded HR policies and more and better evaluation procedures. It would also be sensible if the EU would fund only the operations that lack some sort of public funding, and not all the training needs that exist in the lagged regions of Europe and that may be funded by other types of sources. For the USA this study means that the neo-liberal receipt is not as easily transferable as it seems at rst sight, on pure economic grounds. There are conditions that base the US economic success and the type of US HR policies, which cannot be found easily elsewhere. Furthermore, it is evident from this paper, that, if there is a model which is closer to perfection and that should be seen as a benchmark or as a collection of best practices, it is certainly the Nordic type of welfare state. Research limitations This study has at least two shortcomings: (1) Limited scope. Although it aimed at discussing an important case, it ignored all the experiences of the other big economic spaces that are considered to be equivalent to the EU and the USA, namely Brazil, Russia, India, China and Japan. This one is an important issue, because extending the analysis may well

Human resources policies compared 415

JEIT 29,5

416

reinforce the ndings presented, on the specicity of the social systems in which HR policies are involved, on the need for those policies to exist as a balance to market generated unbalances and on important questions that shape the HR policies as the role of the central authority, the denition of eligibility and priorities, and the evaluation procedures. (2) Limited data. The gures presented are enough to draw a distinctive picture of the situations regarding HR policies in the EU and in the USA. But it would be very presumptuous not to say that it would be very interesting to update and specify them. In a word, it would be very good to present updated statistical data on all the subjects addressed in the Analysis section, but this is really a very difcult task. Implications for future research HR researchers usually refer to their subject as a mosaic. This study is a contribution for that mosaic. Its ndings can improve the mosaic in two ways: (1) As a base for the relativization of the ndings of the comparative studies, using the WS framework. This is particularly signicant, given the big importance of the USA and the UK-based scientists in the HRD eld, which have for rst experience a Liberal form of WS. (2) As a new way of looking at the EU and at the world, based on socio and economic continents; which should became also a subject of comparative studies. However, this study could be developed and completed in some ways: . by comparing the HR policies in the other economic spaces that were listed, namely Japan, Brazil, India, Russia and China; . by deepening the analysis made on HR policies, trying to nd updated statistics; and . by verifying if there is really only a form of Liberal Welfare State in the USA, or if there are variations to that idea. Conclusions The analysis presented in this paper made it possible to draw the following ve main conclusions about the European and US HR systems: (1) All the E&T schemes have historic roots and depend on the economic characteristics of the country in question. The nineteenth century that gave raise to the USA was certainly very different from the many centuries that shaped the European society. In consequence, in the USA, following Independence, a type of strong liberal economy appeared, which in consequence generated a liberal WS. On the contrary, in Europe, in the twentieth century, several types of societies existed, characterized by several types of welfare states and necessarily, with different types of E&T markets and policies. Americans tend to think that their liberal world can be applied everywhere, but in fact, even if some economic principles that drive the US HR system are correct, history and society might make their use particular, differing in time and in space, due to political, economic and social causes with

(2)

(3)

(4)

(5)

historic origin. So, the transferability if the US way of life depends on the economic, social and political roots of the various HR systems that exist in Europe. The same reasoning could be applied to many other important regions, like Latin America, Brazil, Russia and the former USSR States, China, India, Japan, Asia Sub-Saharan Africa, the Arab World and Oceania. In the USA the central government has a much more closer link to the populations, than in the EU; and in the EU, the subsidiarity principle puts severe limits to the possible intervention of the European Commission; very curiously, it is when the subsidiarity principle is overlapped and the EU inuence becomes permanent and structural, that the EU inuence is perceived as stronger. Owing to its immense diversity and bigger unbalance, the EU should increase the level of funds that are used federally in favour of the corrections of the disparities that exist within the EU itself; that increase would call for a signicant raise in the level of the EU structural funds related with education and training; the bigger need of resources needed to make those policies could result in the implementation of an European tax. However, the increase in funds which was just mentioned should be made in the core of a severe funding policy, meaning that the eligibility should be strict; thus, specially in the training market, the public support should be given when there is an evident need of HR funding, and not when there is only a need of E&T; nally, free of cost higher education will probably become a nancial impossibility in the future. Because the EU investments are not made spending foreign money, but European own and scarce resources, and even if the evaluation of HR policies and investments is a very complex and tricky eld, the EU should continue to improve the level and scope of the evaluation of its own HR policies, continuing a trend that began in 1990 and has been slowly developing ever since. The other main providers in the HR market (companies, European National Governments, the US Federal Government) should also take part in that important evaluation effort.

Human resources policies compared 417

References Ashenfelter, O. and Lalonde, R. (1996), The Economics of Training The International Library of Critical Writings in Economics, Vol. 65, Edward Elgar Publishing Limited, Cheltenham. Becker, G. (1980), Investment in human capital: effects on earnings, Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, Chapter II, University of Chicago Press, Chicago, IL, pp. 15-44. Deacon, B. (2000), Eastern European welfare states: the impact of the politics of globalization, Journal of Social European Policy, Vol. 10 No. 2, pp. 146-61. Department for Education and Employment (1998), The Learning Age: A Renaissance for New Britain, Employer funded training Appendix, section 5, available at: www. lifelonglearning.co.uk/greenpaper/ch8005.htm (The) Economist (2003), Europe in Figures, 5th ed., Prole Books, London. Esping-Andersen, G. (1990), The Three Worlds of Welfare Capitalism, Princeton University Press, Princeton, NJ.

JEIT 29,5

418

European Commission (2003), Le Capital Humain dans une Economie Fondee sur la Croissance, Raport Final, DG Emploi et Affaires Sociales, Bruxelles. Eurostat (2003), Annuaire 2003 Le Guide Statistique de lEurope, Bruxelles. Ferrera, M., Hemerijck, A. and Rhodes, M. (2000), The Future of Social Europe. Recasting Work and Welfare in the New Economy, Celta Editora, Oeiras. Heckman, J., Lalonde, R. and Smith, J. (1999), The economics and econometrics of active labour market programs, in Ashenfelter, O. and Lalonde, R. (Eds), Handbook of Labour Economics, Vol. 3A, Chapter 31. North-Holland, New York, NY, pp. 1865-2097. McConnell, C. and Brue, S. (1989), Contemporary Labor Economics, 2nd ed., international ed., McGraw-Hill, Singapore. Mortensen, J. (2000), Intellectual capital: economic theory and analysis, in Buiges, P., Jacquemin, A. and Marchipoint, J.F. (Eds), Competitiveness and the Value of Intangible Assets, Edward Elgar, Cheltenham. OECD (1998), Human Capital Investments, OECD, Paris. OECD (2003), Education at a Glance, available at: www.oecd.org/document/34/ 0,2340,en_2649_34515_14152482_119656_1_1_1,00.html Paul, J. (1989), La Relation Formation Emploi: Un De pour l Economie, Economica, Paris. Policy Almanac (2001), Job Training and Vocational Training, available at: www.policyalmanac. org/economic/job_training.shtml Richonnier, M. (1985), Les Metamorphoses de lEurope, Flammarion, Paris. Shackleton, J. (1995), Training and Unemployment in Western Europe and the United States, Edward Elgar, Aldershot. Skyrme, D. (2003), Measuring Intellectual Capital: A Plethora of Methods, available at: www. skyrme.com/insights/24kmeas.htm Sveiby, K. (2002), Methods for Measuring Intangible Assets, available at: www.sveiby.com/ articles/Intangible/Methods.htm Taylor, F. (1964), Scientic Management, Harper & Row, London. Tome, E. (2001), The evolution of vocational training: a comparative analysis, Journal of European Industrial Training, Vol. 25 No. 7, pp. 380-8. United Nations (2003), Human Development Report 2003, United Nations, New York, NY. US Census Bureau (2002), Statistical Abstract of the United States, 122nd ed., US Census Bureau, Washington, DC. US Congress Ofce Technology Assessment (1990), Worker Training Competing in the New International Economy, US Congress Ofce Technology Assessment, Washington DC. Wilson, D. and Purushothaman, R. (2003), Dreaming with BRICs the path to 2050, Goldman Sachs Global Economics Paper, No. 99, The Goldman Sachs Group, Inc., New York, NY. World Bank (1986), World Development Report, World Bank, New York, NY. World Bank (2003), World Development Report, World Bank, New York, NY. Further reading World Bank (2001), World Development Report, World Bank, New York, NY.