The impact of flexible working at firm level. Evidence from Greek labor market

Global competition and the rise of structural unemployment during the 1980s and 1990s increased the demand for flexibility at labor markets. Since the early1990s, Greece following the directives of the European Union, gradually adopted reforms to ease the use of flexible forms of employment. This paper maps the recent evolution of flexible employment in Greece and makes an innovative empirical analysis of the employers' opinion about the impact of flexible working on their businesses during the crisis. The analysis is based upon a questionnaire through which the problem is investigated with the help of the statistical software R. To compare the sub-samples and in order to test any potential differences between them, we applied the Χ2 (chi square) analysis. We used a sample of almost 1000 respondents, drawn from the Greek SME sector, during the period October – December 2018. The results of our research seem to confirm the related findings of earlier studies. Our descriptive analysis shows that the impact of flexible working forms on entrepreneurship in Greece is ambiguous. In particular, it is concluded that flexible working forms has not contributed to human resource management. On the contrary, it seems that flexible working can reduce labor and insurance costs.


INTRODUCTION
Restructuring of enterprises, as a result of tightening competition in the world economy, is not limited to production processes only, but also extends to labor relations, transforming them and making them more flexible. Nowadays, the term "flexibility" is equally applicable to various forms of employment, their duration, location, distribution of working time, wages and -in general -to the organization of work processes. Traditional work hours are replaced by new flexible working patterns. Several different dimensions of flexibility are identified in literature (Whyman & Petrescu, 2011;Rogers, 2007;Madsen, 2006;Monastiriotis 2006;Wickham, 2005;Wilthagen, et.al. 2004;Goudswaard & de Nanteuil, 2000;Lenz 1996;Brewster et.al. 1997;Lee 1996;Boyer, 1987;Atkinson & Nigel, 1986): • Internal or functional flexibility. This largely concerns the ability of firms to organize and reorganize internal processes of production and labor use in the interests of productive/dynamic efficiency, e.g., through the flexibility of working time, job contents, skill needs or technical change. • Wage flexibility. A variety of institutional policies and regulations may limit wage variation, including minimum wage regulation, trade union activity and the extent to which they are coordinated with wage bargaining definition. • Employment protection. Employer freedom to hire and dismiss employees is at the heart of debates on the flexibility issue.
In industrialized countries, labor market flexibility was part of a strategy proposed by the OECD in its 1994 Jobs Study. In the 1990s in European Union's countries significant development of flexible forms of employment occurred since it was widely supported that flexible working arrangements are a critical component of the adaptability and competitiveness of enterprises and the economy as a whole (Hyz & Karamanis 2017;Karamanis et.al. 2016;Zaridis & Karamanis 2015;Sahinidis et.al., 2014;Karamanis & Naxakis 2014;Jahn et.al. 2012, Hyz 2011Hyz & Pappas 2005;EC 1997, Morgan 1996, OECD 1996. This development, however, was not uniform. Among the countries of the European Union, the higher percentages were observed in the Netherlands, the United Kingdom, Denmark and Germany (OECD, 1995). On the other hand, Greece and other South European countries had much lower percentages of flexible employment which was initially limited mainly to women. For many years, these countries were dominated by the "traditional" form of employment that can be described as follows: permanent lifelong employment, eight-hour work day, working at the companies' workplace and access to social benefits. Any other form of employment beyond the above pattern was considered incidental and transitory.
Over the last decade, a number of significant changes occurred in the Greek system of labor market, especially during the economic crisis. Because of the simplification of labor laws procedures, the use of flexible working forms has substantially increased. The present article examines the impact of flexible working forms on entrepreneurship in Greece. In particular, the main questions of our research are whether the implementation time affected the: • Human resources management (human resource planning and labor productivity); • Labor costs (salary and insurance costs); • Employment and unemployment rates; • Management of the economic crisis. In our research the implementation time is reviewed as before the economic crisis vs. during the economic crisis.
Our original sample includes over 1000 enterprises that were active in different sectors of Greek economy. The enterprises are active in all basic sectors of the economy, such as industry, retail, food, service and technical companies. We collected the primary data concerning these companies by interviewing appropriately qualified members of the personnel using a structured questionnaire. The questionnaire of the research (see Appendix) consists of closed questions and is divided in two parts. The first part concerns basic company data (startup date, business sector, legal form, size, location of the head office, whether new personnel or pre-existing personnel is employed under flexible work forms and when flexible work forms were initiated). These data allow us group the companies at several levels of interest. The second part of the questionnaire includes 8 questions that assess certain employment indices which are frequently used in relevant literature. The questions are grouped as follows: human resources management (q. 1,2), employment and unemployment (q. 5,6), economic crisis management (q. 7) and flexible working (q. 8).

LITERATURE REVIEW
Analysis of flexible forms of employment is a complex task. Due to its various forms, countries' specific factors, heterogeneity of economic and labor market conditions, it might be insufficient to analyse it using a single approach. This diversity led to remarkable differences in findings reported. A growing number of empirical studies have investigated the theory and practice of labor flexibility in the market.
Among the first studies about the impact of flexible working hours to job satisfaction and performance were these of Schein (1977) and Orpen (1981). These studies concluded that flexible working hours significantly improve job satisfaction but have limited impact on employee productivity. In contrast, Papalexandris and Kramar (1997) showed that flexible working arrangements could serve a number of organizational purposes including increasing competitiveness and productivity; fostering organizational change; and improving recruitment quality and the retention of labor. Bolle (1996) studied part-time employment and concluded that when the employee can make a free choice freely choose to select this type of employment protected by Labor Law, the overall productivity is increased. Hunter et.al. (1993) and Mayne et.al. (1996) concluded that a high degree of correlation exists between flexible working and human resources management, which finally affects the business strategic management.
De Grip et al. (1997) believe that in Europe the rise in part-time employment might help offset the increase in the unemployment rate. In the same direction, Pencavel (1994) reports that from 1960 to 1990 total employment increased by 10 % in the United Kingdom and by 77% in the United States. Blanchflower and Freeman (1993) calculated that for males the probability of making the transition from unemployment to working fell from 0.46 in 1979 to 0.32 in 1990. For females, there was virtually no change in both years with probabilities at around 0.43. Booth et.al. (2002) concluded that increased labor market flexibility creates job opportunities for young workers, less -skilled works, women and immigrants. In addition, they found out that temporary agency jobs seem to be a common pathway for unemployed to re-enter the labor market. Kahn (2007) showed similar conclusions. In contrast, Baker et.al. (2005) and Baccaro and Rei (2005) showed that the direct relationship between employment protection and unemployment is insignificant and confirmed there finding using multivariate analysis. Guell (2003) found that total outflows from unemployment had increased. Kahn (2010), investigated the impact of reforms of employment protection systems in nine countries on the incidence of employment and of temporary jobs for wage and salary workers and concluded that policies which facilitate the creation of temporary jobs on average raise the likelihood that wage and salary workers will be in temporary jobs. However, there is no evidence that such reforms raise employment. Schmitt and Wadsworth (2002), find out that in both the US and the UK, employment growth can be at the most part traced to macro-economic policy, and that labor market flexibility has mainly helped to increase inequality. In addition, they have found little evidence that the more flexible labor markets of UK and US performed better for marginal groups. Mihail (2003) analyzed the contractual flexibility in thirty companies and institutions in Greece and concluded that the temporary work is the primary source of contractual flexibility, which is mainly used to adjust corporate capacity to demand variations and not used in order to cut labor costs. In contrast, Gyoker and Finna (2010) studying the status of flexible employment forms in Hungarian Small and Medium Sized Enterprises concluded that efficient and flexible utilization of the workforce is essential for the company, since it influences competitiveness and has significant impact on labor costs. Hunt (2013) concluded that employers clearly take advantage of flexibility to accommodate the business cycle, preferring to use the flexible overtime hours. Houseman (2001) examined which employers use flexible staffing arrangements and their implications for workers and public policy, found out the most commonly cited reasons for using all types of flexible staffing arrangements are traditional reasons concerning the need to accommodate fluctuations in workload or absences in staff. Many employers also use agency temporaries and part-time workers to screen candidates for regular positions. Finally, savings on benefits costs is an important factor determining employers' use of flexible staffing arrangements. Howard (2003) concluded that companies due to flexible employment contracts can have significant cost benefits compared to full time employment contracts. Likewise, Targouzidis and Robolis (2001) concluded that flexible work arrangements facilitate businesses to maximize their value through reducing the production costs. Whitehead (1998) showed that although flexible work arrangements have benefits for businesses because of wage cut, on the other hand complex administrative and communication issues arise. Radulescu and Robson (2013) used data from 19 OECD economies and showed that freeing-up regulatory constraints on employers' use of labor enhances a more favorable investment environment. Vandenberg (2006) found out that flexibility at work gives companies the ability to adapt to demand changes, technological developments and to the global competition. Similarly, Reilly (1998) found out that those flexible labor relations can help companies to face increased competition and market volatility. In the same line of thought, Cazes and Nesporova (2001) concluded that competitive businesses are able to adapt their size, structure and specialization of the human resources to the market conditions. Finally, according to Houseman et.al. (2003), who are studying six hospitals and five auto suppliers in USA, and the study of Boeri (2011) increasing labor market flexibility is widely expected to increase firms' productivity and competitiveness.

FLEXIBLE WORKING IN GREECE
Significant changes regarding the status of flexible working occurred in Greece during the last decade, and especially during the period that the economic crisis unfolded. Greece, being a member of the EU, has implemented the relevant European policy of strengthening flexible working. Due to demands for greater flexibility in labor market that resulted to reforms in legislation regarding employment protection, the share of flexible forms of employment has significantly increased (Karamanis & Hyz, 2016;Karamanis, 2011).

METHODOLOGY
The present study was focused on companies in the major sectors of Greek economy that currently employ or have employed personnel under some form of flexible working forms. These companies were identified using the Greek Chamber of Commerce and Industry. In order to achieve accuracy in our estimations, to limit statistical errors and avoid biased estimations, companies were grouped by prefecture according to their workforce.
A field research was conducted during the period from October 2018 to December 2018. Data were collected through interviews based on a structured questionnaire, in three phases. In the first phase, the questionnaire was edited and improved with the help of a pilot interview. In these second phase, telephone interviews were made to administrative staff at 50 representative companies, after they have been asked to complete a questionnaire, which was delivered to them by e-mail. Finally, in the third phase, based on experience gained from previous surveys, a number of in site interviews were conducted, so as to strengthen the interviewees' engagement to the research. During the study, 1059 persons were interviewed. Of them, 1005 worked on small enterprises (0-50 employees), 42 persons worked on enterprises with 51-250 employees and the rest 12 persons worked on large enterprises (> 250 employees) across the Greek market. The reliability degree and information quality of the sample can be considered high, since it mostly resulted from interviews with companies' owners or executives.
Each interview, typically, exceeded 30 minutes and captured information, among others, about the company's years of operation, legal form, size, practices used by its human resources department, labor costs, management decisions during the economic crisis period and the company's view about flexible working. Likert scales (1-5), ranging from "strongly disagree" to "strongly agree" were used for all valuation items to ensure statistical variability among survey responses for all items measured.
The data were evaluated descriptively with the help of the statistical software R. To compare the subsamples: the implementation time (before economic crisis vs. during the economic crisis) and in order to test any potential differences between them, we applied the Χ 2 (chi square) analysis so as to evaluate whether the frequencies of these differences were statistically significant or not. In order to reveal possible differences among companies' views on the marketing component of the impact of flexible working at firm level, we explicitly compare/contrast the low and high evaluations and not the intermediaries. Our next step is to study the research data on the basis of econometric model.

EMPIRICAL RESULTS AND DISCUSSION
The results of our study confirm the equivocal findings of previous studies. In particular, the descriptive analysis show that flexible forms of work have not contributed to human resource managing, namely to entice labor force, the definition of the various tasks and working hours while less than half of the companies (44.5%) state that flexible working models have positive contribution. Whitehead (1998) reached to the same conclusion, namely that flexible working forms create complex managerial and communicative problems. On the contrary, Ηunter et al. (1993), Mayne et al. (1996) and Papalexandris and Kramar (1997) concluded that flexible working forms closely correlated with human recourse management.
Furthermore, in agreement with Orpen (1981) and Schein (1977), the companies of our study confirmed (52.7%) that there was no improvement on employee productivity as a result of flexible working forms. In contrast, Papalexandris and Kramar (1997) and Βοlle (1996) concluded that flexible working forms can serve many organizational purposes including increased labor productivity.
Nevertheless, the flexible working forms seem to have reduced labor and insurance costs of companies by 54.4% and 82%, respectively. This agrees with the findings of Hunt (2013), Gyoker and Finna (2010), Mihail (2003), Houseman (2001), Howard (2003), Targouzidis and Robolis (2001) and Whitehead (1998) studies, namely that the flexible working forms can offer cost benefits in comparison to full-time employment.
In order to determine whether the flexible working forms contribute positively to increase the employment and as a result to decrease unemployment, the results seem to be ambiguous. According to our study, 52.1% of the companies answered that flexible working forms helped them in order to maintain jobs while a significant percentage (75.9%) stated that flexible work did not contribute to the creation of new ones. Similar are the results of several other studies (Kahn 2010, Baker et al. 2005, Baccaro and Rei 2005, Guell 2001, Schmitt and Wadsworth 2002 showing that there is no evidence that flexible working forms really increased employment and decreased unemployment. In contrast, Kahn (2007), Booth et al. (2002), De Grip et al. (1997), Penchant (1994, Blachflower and Freeman (1993) concluded that the labor market flexibility tends to create new job opportunities and this seems to be a common pathway for unemployed persons to re-enter the labor market.
The majority of our sample (71.1%) answered that the flexible working forms helped them to address the effects of the economic crisis. This agrees to the findings of other studies Radulescu and Robson (2013); Boeri (2011);Vandenberg (2006);Houseman et al. (2003); Cazes and Nesporova (2001); Reily (1998)) that flexibility of labor market not only increases productivity and competitiveness but also encourages the creation of a positive investment climate.
Finally, with regard to the prospects of Greek labor market, 55.8% of the companies of our study believe that flexible working forms will be further increased in the near future.
The results of the major changes in the working model are detailed in Table 1.

Source: data research
In our study, we tried to evaluate the answers of the companies of our sample using a chi square (X 2 ) analysis in accordance with the time of implementation of flexible working form. Since some data assume small values, chi square approximation might have been poor. This issue was addressed by adding simulated values (setting simulate.p.value = TRUE in R's chisq.test function). Furthermore, CramerV values were computed. CramerV is a measure of association between two nominal variables. and assumes values in [0, 1]. Table 2 presents contingency data alongside with chi-square, p-value and CramerV for each question

Kostas Karamanis, Christos Gogos
The impact of flexible working at firm level.
Evidence from Greek labor market posed. Table 3 consolidates the contingency data by joining 'not at all' and 'very little' responses and 'much' and 'very much' responses. It also consolidates columns '2010-2012' and '>2012' as the 'during crisis' column, while '<2010' becomes the column 'before crisis'. We reached to the following conclusions: Among the companies that have used flexible working forms of our study, 44.2% answered that flexible working forms contributed to human resource planning in order to find employees, to specify work duties or to apply a flexible working hour program etc. At almost identical percentage (44.8%) companies that have used flexible working forms for the first time during the economic crisis, believe that flexible working forms were positive for them. Nevertheless, a p-value of less than 0.001 indicates statistical difference which may be explained by the fact that before economic crisis the flexible working forms were the result of the business planning. On the contrary, the flexibility in labor market during economic crisis may be caused by negative economic developments both at micro-and macroeconomic level.
With regard to labor productivity, no statistically significant differentiation was observed (p-value=0.088) among companies that have used flexible working forms for the first time not only before but also during the economic crisis. Among companies, 51.2% and 54.1% respectively, answered that flexible working forms did not increased labor productivity.
On the contrary, statistically significant difference was observed on work pay (p-value<0.001). Among companies, 59.3% answered that flexible work forms helped them reduce wages before crisis while the corresponding percentage for companies during crisis was 49.7%.
Regarding insurance costs, almost 6 out of every 10 companies, irrespectively of using flexible working forms, before and during the economic crisis answered (84.7% and 79.4%, respectively) that these forms decreased their costs (p-value=0.05).
On the other hand, we found a greater positive effect of flexible working forms on employment during the economic crisis than we found before crisis. Flexible working forms contributed mainly to maintain existing jobs (53.4%, p-value=0.038) and create new ones (80.1%, p-value<0.001) than those of flexible working forms before economic crisis (50.8% and 71.5 %, respectively).
Similarly, we found a significant statistical differentiation also on economic crisis management (p-value<0.001). Adoption of flexible working forms during economic crisis helped these companies to cope better with the consequences of crisis (75.0%) than those of companies that adopted flexible working forms before crisis (67.1%).
Finally, there was no statistically significant difference on perspective of flexible working forms. Companies that used flexible working forms before crisis (56.2%) and companies that used flexible working forms during crisis (55.2%) believe that the future use of flexible working will increase.
The CramerV values indicate that the impact of flexible working on companies is stronger regarding new jobs creation (0.171) and management of economic crisis (0.142).

CONCLUSION
In this paper we aimed to explore the impact of flexible working forms on entrepreneurship in Greece. In particular, we investigated whether the implementation time and the case of flexible working affected the entrepreneurship in specific indicators such as: human resources management, labor costs, employment and unemployment rate and economic crisis management. In order to achieve this, we conducted during the period from October 2018 to December 2018 field research in over 1000 companies of the major sectors of Greek economy. The data were evaluated descriptively with the help of the statistical software R. To compare the sub-samples and in order to test any potential differences between them, we applied the Χ 2 (chi square) analysis.
The results of our research seem to confirm related findings of earlier studies. Descriptive analysis shows that flexible working forms have not contributed to human resource management. Furthermore, companies in our research, confirm overwhelmingly that there was not any improvement at employee productivity as a result of flexible working implementation. Nevertheless, it seems that flexible working can reduce labor and insurance costs. Regarding the impact of flexible working forms on employment and unemployment, the results are ambiguous, as more than half of the companies answered that flexible working has helped them to maintain existing jobs; while a significant percentage of them believe that flexible working assisted the creation of new jobs. The majority of our companies answered that flexible working helped them to face the effects of the economic crisis. Finally, the question about the prospects of flexible working in the Greek labor market shows that the majority of the companies believe that in the near future, flexible working will be further expanded.
Comparing the answers of companies in our study with respect to the implementation time of flexible working, the conclusion is that companies that have used flexible working before the economic crisis facilitated human resource planning. This was attributed to finding new employees easier, specifying work duties with less constraint, giving freedom in scheduling work times etc. In contrast, the results of the comparison conclude that flexible working during the economic crisis contributed to the preservation of existing jobs and to the creation of new jobs. Moreover, adoption of flexible working during the economic crisis seem to have helped companies to encounter business difficulties more effectively when compared to companies that have adopted flexible working before the economic crisis.
In practice, all flexible working forms can be very useful to achieve individual interests for both, the company and the workforce. But on the other hand they can also be related to some negative aspects. The companies are able to react in periods of waving workload and, hence, to work more efficient and effective regarding productivity and costs. However, negative aspects are reflected in a high organizational effort, especially compared to traditional working time regulations. Employees benefit from more flexibility regarding their work-life balance, but they also have to renounce extra charges caused of a working hour surplus.