Introduction

In the mid-1990s, a new economy marked by the explosive growth of information and communications technology (ICT) is more strongly dependent on the use of knowledge than ever before across advanced capitalist democracies (OECD, 1996). As knowledge is embodied in human beings, the economy places emphasis on human capital investment which generates a highly skilled workforce, especially in the service sector. Post-industrial societies, coupled with the transition to the knowledge-based economy, have faced new social needs and demands in family life and the labour market, which are labelled ‘new’ social risks. According to Bonoli (2005) and Taylor-Gooby (2004), new social risks are generally related to three factors: (1) the problem of reconciling work and family life (mostly, care for children or frail elderly family members) as a result of the massive labour market participation of women, (2) the risk of being unemployed or paid low wages due to low/obsolete skills, (3) the risk of insufficient protection in social security schemes for workers engaged in atypical jobs like part-time and temporary work. These new social risks most seriously affect vulnerable groups such as low-skilled workers, women and young people. They are different from the ‘old’ social risks of industrialised economies – the risk of sickness, unemployment and retirement of the male breadwinner – against which protection is available in the form of unemployment insurance and pensions contingent upon fulltime employment.

In the process of economic and social transformation, advanced capitalist democracies have modernised their welfare state settlements, especially by developing social investment policies. As such, a social investment perspective is intended, on the one hand, to sustain the knowledge-based economy, where knowledge accumulation of a skilled workforce entails higher productivity and economic growth, and, on the other, to better address new social risks that people face in successive stages of their life courses (Morel et al, 2012). Above all, the idea is based on an understanding that skill development and facilitation of employment are the best responses to workers’ needs and the best prevention against the new risks. As a consequence, central to the work-oriented policy tool are active labour market policies (ALMPs) and work–family policies (WFPs). Childcare, for example, is expected to not only allow children to improve cognitive and non-cognitive abilities through high-quality early childhood interventions, but help mothers of young children to engage in paid employment.