The Reorganization of Unemployment Insurance in Response to the Economic Crisis

In response to the recession of 1974/1975 Switzerland introduced a nationwide obligation for unemployment insurance. However, its implementation was a long drawn-out affair. A definitive solution was only fully implemented in 1984.

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In contrast to most European countries, Switzerland did not have compulsory unemployment insurance until 1976. The federal unemployment act of 1951 had retained the subsidized system introduced in 1924. The proportion of people covered by unemployment insurance even declined during the boom years. In 1974, less than a fifth of workers benefited from such coverage. It was only the pressure of the recession that brought about fundamental changes, and these were implemented very quickly compared to other socio-political reforms.

Around 300,000 jobs were cut in Switzerland in 1975/1976 alone; two thirds of which were offset by the return migration of foreign workers when authorities decided not to renew their residence permits. These job cuts also hit many women. The limited prevalence of unemployment insurance and the return migration of foreign workers did, however, keep official unemployment figures low. On 13th June 1976, voters passed a new constitutional article that set the framework for future unemployment insurance: affiliation would be mandatory for all workers who were not self-employed, financing by payroll contributions and decentralized administration. Just a few months later, the Federal Council passed a transitional unemployment regulation that was applied until a relevant law entered into force. Those affected by unemployment were entitled to 150 daily allowances covering 70-80 percent of lost income. The Federal Act on Compulsory Unemployment Insurance and Insolvency Compensation was passed in 1982 and became effective on 1st January 1984. The legislation raised the number of daily allowances to 180. It also provided benefits for partial unemployment situations, loss of employment because of bad weather and insolvency compensations, measures to promote integration in the labor market and control measures against benefits fraud.

Literatur / Bibliographie / Bibliografia / References: Togni Carola (2013), Le genre du chômage. Assurance chômage et division sexuée du travail en Suisse, Thèse de doctorat, Université de Berne; Tabin Jean-Pierre, Togni Carola (2013), L’assurance chômage en Suisse. Une socio-histoire (1924–1982), Lausanne; Schmidt Manfred G. (1985), Der schweizerische Weg zur Vollbeschäftigung: eine Bilanz der Beschäftigung, der Arbeitslosigkeit und der Arbeitsmarktpolitik, Frankfurt am Main.