This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 03 ROME 001360 
 
SIPDIS 
 
DEPT FOR DRL/IL, EUR/WE, EB/OMA, INR/EUC 
DOL FOR ILAB/PERLMUTTER, BRUMFIELD, LEVINTOW 
TREASURY FOR OASIA HARLOW, CARNES 
 
E.O. 12958: N/A 
TAGS: ELAB ECON PGOV PINR ECON PGOV PINR ECON PGOV PINR IT ITELAB ITELAB
SUBJECT: LABOR ANTIPASTI FOR ITALY 
 
                       UNCLASSIFIED 
 
PAGE 02        ROME  01360  01 OF 03  311336Z 
REFTELS: A) ROME 579 B) 02 ROME 5750 C) 02 ROME 5139 
 
¶1. INTRODUCTION:  THIS CABLE IS THE FIRST IN A PERIODIC 
SERIES REPORTING RECENT DEVELOPMENTS AND TRENDS CONCERNING 
ITALY'S LABOR MARKET, LABOR-MANAGEMENT RELATIONS AND TRADE 
UNION ACTIVITIES.  THE ITEMS INCLUDED ARE USEFUL TIDBITS; 
SMALL DISHES (ANTIPASTI IN LOCAL PARLANCE) OF INFORMATION TO 
SUPPLEMENT MORE DETAILED REPORTING ON MEATIER SUBJECTS. 
COMMENTS, QUESTIONS OR REQUESTS FOR ADDITIONAL INFORMATION 
SHOULD BE DIRECTED TO LABOR COUNSELOR JOHN BASS 
(BASSJR@STATE.GOV) OR LABOR SPECIALIST GAETANO PELLICANO 
(PELLICANOG@STATE.GOV) 
 
¶2. ON THIS EDITION'S MENU: 
 
-- GOVERNMENT SERVES UP 2002 EMPLOYMENT DATA;  GAINS 
OUTSTRIP GDP GROWTH RATE 
-- POLITICALLY-MOTIVATED STRIKES CHOKED THE COUNTRY IN 2002 
-- ITALIAN EDUCATIONAL SYSTEM DOESN'T CUT THE MUSTARD 
-- NEW PUBLIC SECTOR CONTRACT STEAMS EMPLOYERS 
-- EMPLOYERS, TRADE UNIONS STEWING OVER DECLINING INDUSTRIAL 
COMPETITIVENESS 
-- PARLIAMENT COOKS UP SWEEPING EDUCATION REFORM 
 
2002 EMPLOYMENT GAINS OUTSTRIP GDP GROWTH, ESPECIALLY IN 
SOUTH 
--------------------------------------------- -------------- 
 
                       UNCLASSIFIED 
 
PAGE 03        ROME  01360  01 OF 03  311336Z 
¶3. THE ITALIAN ECONOMY ADDED 315,000 JOBS IN THE FORMAL 
SECTOR IN 2002, AN INCREASE OF 1.5 PERCENT, ACCORDING TO THE 
NATIONAL STATISTIC INSTITUTE'S ANNUAL SURVEY.  ALTHOUGH THE 
ECONOMY ADDED FEWER JOBS THAN IN EITHER OF THE TWO PRECEDING 
YEARS, THE MODEST GROWTH IN EMPLOYMENT NONETHELESS EXCEEDED 
THE MINIMAL 0.4 PERCENT GROWTH IN GDP.  PAYROLL EMPLOYMENT 
ACCOUNTED FOR ALL OF THE GROWTH; THE NUMBER OF SELF-EMPLOYED 
ITALIANS DECLINED SLIGHTLY (BY 18,000).  SLIGHTLY OVER ONE- 
THIRD OF THE NEW POSITIONS, OR 115,000, WERE PART-TIME OR 
FIXED-TERM.   EMPLOYMENT AMONG WOMEN GREW AT 2.2%; OVER HALF 
THE NEW JOBS CREATED WENT TO WOMEN.  REGIONALLY, GROWTH IN 
EMPLOYMENT WAS STRONGEST IN THE CHRONICALLY UNDERDEVELOPED 
SOUTHERN REGION (1.9 PERCENT), FOLLOWED BY THE CENTER (1.8 
PERCENT) AND NORTH (1.1 PERCENT), ALTHOUGH NORTHERN ITALY 
CREATED THE MOST JOBS (123,000) OF THE THREE REGIONS. 
TRADITIONALLY LARGE REGIONAL DISPARITIES IN UNEMPLOYMENT 
CONTINUED: THE ANNUAL UNEMPLOYMENT RATE IN NORTHERN ITALY 
WAS 4 PERCENT; IN CENTRAL ITALY, 6.6 PERCENT; AND IN 
SOUTHERN ITALY, 18.3 PERCENT.  THE BERLUSCONI GOVERNMENT 
SIMULTANEOUSLY TOOK CREDIT FOR THE MODEST GOOD NEWS AND 
CITED THE ENORMOUS REGIONAL DISPARITIES AS FURTHER EVIDENCE 
OF THE NEED FOR RAPID IMPLEMENTATION OF ITS PACKAGE OF LABOR 
MARKET REFORMS (APPROVED BY PARLIAMENT, PENDING 
IMPLEMENTATION REGULATIONS BY THE LABOR MINISTRY - SEE REF 
A). 
 
STRIKE TOTALS SKYROCKETED IN 2002, LARGELY FOR POLITICAL 
REASONS 
--------------------------------------------- -------------- 
 
¶4. ITALIAN WORKERS SPENT OVER 4 MILLION MAN-DAYS ON STRIKE 
                       UNCLASSIFIED 
 
PAGE 04        ROME  01360  01 OF 03  311336Z 
IN 2002, A 355-PERCENT INCREASE OVER THE PRECEDING YEAR, 
ACCORDING TO NATIONAL STATISTICS INSTITUTE ISTAT.  ROUGHLY 
32.7 MILLION MAN-HOURS WERE LOST TO STRIKES, UP FROM 7.2 
MILLION MAN-HOURS IN 2001.  OVER 85 PERCENT OF THE LOST TIME 
- SOME 27.5 MILLION MAN-HOURS - STEMMED FROM STRIKES CALLED 
FOR MOTIVES UNRELATED TO BARGAINING OR OTHER ELEMENTS OF 
LABOR RELATIONS.  IN 2001, ISTAT REGISTERED ONLY 144,000 MAN- 
HOURS LOST TO STRIKES FOR REASONS OTHER THAN LABOR 
RELATIONS.  THE HUGE INCREASE REFLECTS PRIMARILY DECISIONS 
BY THE TRADE UNION CONFEDERATIONS (ESPECIALLY CGIL, THE 
LARGEST AND MOST LEFT-LEANING POLITICALLY) TO CALL SEVERAL 
NATIONAL STRIKES TO PROTEST BROAD GOVERNMENT POLICY.  OF 
THOSE HOURS LOST TO STRIKES UNDERTAKEN FOR TRADITIONAL LABOR 
MOTIVES, OVER SIXTY PERCENT WERE CONCENTRATED IN THREE 
SECTORS: METALWORKERS (1.8 MILLION MAN-HOURS, OR 34.8 
PERCENT); PUBLIC ADMINISTRATION AND GOVERNMENT EMPLOYEES 
(833,000 MAN-HOURS, OR 16 PERCENT); AND TRANSPORT AND 
TELECOM (532,000 MAN-HOURS, OR 10.2 PERCENT). 
 
ITALIAN EDUCATIONAL SYSTEM NOT MEETING WORKFORCE NEEDS 
--------------------------------------------- --------- 
 
¶5. ITALY HAS THE LOWEST RATE IN THE EUROPEAN UNION OF 
MATCHING STUDENTS AND TRAINEES TO JOBS THAT REFLECT THEIR 
SPECIALIZED STUDIES AND PREPARATION, ACCORDING TO A RECENT 
EUROSTAT STUDY.  47 PERCENT OF YOUNG ITALIANS WORK IN A 
 
                       UNCLASSIFIED 
 
                           UNCLASSIFIED     PTQ7720 
 
PAGE 01        ROME  01360  02 OF 03  311337Z 
ACTION DRL-01 
 
INFO  LOG-00   NP-00    AGRE-00  AID-00   CEA-01   CIAE-00  COME-00 
      CTME-00  INL-00   DINT-00  DODE-00  ITCE-00  DOTE-00  ANHR-00 
      SRPP-00  DS-00    EB-00    EXME-00  EUR-00   OIGO-00  E-00 
      FAAE-00  FBIE-00  UTED-00  VC-00    FRB-00   H-01     TEDE-00 
      INR-00   ITC-01   LAB-01   L-00     VCE-00   AC-01    NSAE-00 
      NSCE-00  OMB-01   OPIC-01  PA-00    PM-00    PRS-00   ACE-00 
      P-00     SP-00    SSO-00   SS-00    STR-00   TEST-00  USIE-00 
      PMB-00   DSCC-00  PRM-00   G-00     SAS-00     /008W 
                  ------------------4D9EB4  311338Z /38 
R 311337Z MAR 03 
FM AMEMBASSY ROME 
TO SECSTATE WASHDC 9033 
INFO DEPT OF LABOR WASHDC 
DEPT OF TREASURY WASHDC 
LABOR COLLECTIVE 
EUROPEAN POLITICAL COLLECTIVE 
 
UNCLAS SECTION 02 OF 03 ROME 001360 
 
SIPDIS 
 
DEPT FOR DRL/IL, EUR/WE, EB/OMA, INR/EUC 
DOL FOR ILAB/PERLMUTTER, BRUMFIELD, LEVINTOW 
TREASURY FOR OASIA HARLOW, CARNES 
 
E.O. 12958: N/A 
TAGS: ELAB ECON PGOV PINR ECON PGOV PINR ECON PGOV PINR IT ITELAB ITELAB
SUBJECT: LABOR ANTIPASTI FOR ITALY 
 
                       UNCLASSIFIED 
 
PAGE 02        ROME  01360  02 OF 03  311337Z 
SECTOR DIFFERENT THAN THAT OF THEIR FIELD OF STUDY, COMPARED 
TO 29 PERCENT IN THE NETHERLANDS, 35 PERCENT IN FRANCE AND 
40 PERCENT IN GREECE.  THE PHENOMENON IS THE RESULT OF BOTH 
ECONOMIC AND CULTURAL FACTORS, NOTABLY HISTORICALLY POOR 
INTEGRATION OF THE LABOR MARKET WITH EDUCATION AND TRAINING 
SYSTEMS.  ITALY'S CURRENT EDUCATIONAL SYSTEM IS LARGELY THE 
PRODUCT OF 1920'S, FASCIST-ERA LEGISLATION, CONCENTRATING ON 
CLASSICAL CORE CURRICULA THAT PROVIDES EXCELLENT PREPARATION 
FOR THOSE HEADED TO UNIVERSITY BUT DOES NOT PREPARE OTHER 
STUDENTS FOR THE TYPES OF EMPLOYMENT OPPORTUNITIES AVAILABLE 
IN AN ADVANCED INDUSTRIAL AND INFORMATION ECONOMY. 
INCREMENTAL REFORMS IN RECENT YEARS FAILED TO CORRECT THIS 
FUNDAMENTAL WEAKNESS; A RECENT EDUCATION REFORM PACKAGE MAY 
DO BETTER (SEE LAST ITEM). 
 
¶6. ITALY WAS ALSO LATE IN DEVELOPING A TRAINING SYSTEM FOR 
UNEMPLOYED PEOPLE AND IN ADOPTING THE "LIFE-LONG LEARNING" 
CONCEPT.  PROGRAMS IN BOTH AREAS DID NOT BEGIN UNTIL THE EU 
STARTED CO-FINANCING PROGRAMS IN THE NINETEEN-EIGHTIES 
DEVOTED TO REDUCING THE UNEMPLOYMENT RATE.  EVEN AFTER THESE 
NEW INITIATIVES, TRAINING AGENCIES HAD LIMITED CAPABILITIES 
TO EVALUATE THEIR EFFECTIVENESS IN MATCHING POTENTIAL 
EMPLOYEES TO THE LABOR MARKET DEMANDS; PUBLIC/GOVERNMENT 
EMPLOYMENT SERVICES WERE PRIMARILY BUREAUCRATIC OPERATIONS 
CERTIFYING EMPLOYMENT OR UNEMPLOYMENT STATUS.  PUBLIC 
TRAINING PROGRAMS WERE VIEWED LARGELY AS AVOCATIONAL, 
ALLOWING INDIVIDUALS TO PURSUE PERSONAL INCLINATIONS, RATHER 
THAN AS STRATEGIC TOOLS TO ADDRESS EMPLOYERS' REQUIREMENTS 
FOR WORKERS WITH SPECIFIC SKILLS OR EXPERTISE.  THE RESULT 
HAS BEEN A REMARKABLE MISMATCH BETWEEN SUPPLY AND DEMAND OF 
WORKERS.  UNEMPLOYED ITALIANS OFTEN SPEND TWO TO THREE YEARS 
                       UNCLASSIFIED 
 
PAGE 03        ROME  01360  02 OF 03  311337Z 
LOOKING FOR EMPLOYMENT CONSISTENT WITH THEIR EDUCATION AND 
OFTEN END UP ACCEPTING ALMOST ANY JOB THEY CAN FIND. 
 
NEW PUBLIC SECTOR CONTRACT STEAMS PRIVATE EMPLOYERS 
--------------------------------------------- ------ 
 
¶7. ON FEBRUARY 27, ARAN (THE OPM-EQUIVALENT THAT REPRESENTS 
PUBLIC MINISTRIES) AND THE THREE LARGEST UNION 
CONFEDERATIONS SIGNED A NEW CONTRACT.  THE PACT ESTABLISHES 
NEW REGULATIONS AND SALARIES FOR PUBLIC EMPLOYEES OF THE 
CENTRAL ADMINISTRATIONS, IN ACCORDANCE WITH THE OVERALL 
AGREEMENT ON BARGAINING ESTABLISHED IN 1993.  THE THREE 
MAJOR CONFEDERATIONS PUT ASIDE THEIR DIFFERENCES OVER 
BARGAINING PRIORITIES FOR PRIVATE SECTOR CONTRACTS (WHICH 
ARE NEGOTIATED NATIONALLY FOR EACH INDUSTRIAL/SERVICE 
SECTOR) AND THE GOVERNMENT'S LABOR MARKET REFORM PROPOSALS 
TO PRESENT A UNITED BARGAINING FRONT ON THE PUBLIC SECTOR 
CONTRACT.  AS A RESULT, THEY SECURED AN AVERAGE SALARY 
INCREASE OF 5.7% FOR PUBLIC SECTOR EMPLOYEES - SOME 1 
PERCENT GREATER THAN THE INFLATION TARGET ESTABLISHED BY THE 
BERLUSCONI GOVERNMENT LAST YEAR, GENERALLY USED AS A GUIDE 
FOR SALARY INCREASES IN THE NEW ROUND OF LABOR BARGAINING. 
PRIVATE EMPLOYERS CRITICIZED THE NEW CONTRACT.  THEY CALLED 
THE SALARY INCREASES OVERLY GENEROUS AND INDICATED IT WILL 
MAKE BARGAINING OVER THE NEW SET OF PRIVATE SECTOR CONTRACTS 
MORE DIFFICULT, AS THE CONFEDERATIONS SEEK COMPARABLE SALARY 
INCREASES FROM EMPLOYERS SEEMINGLY DETERMINED TO HOLD WAGE 
INCREASES TO MORE MODEST LEVELS. 
 
¶8. THE PUBLIC SECTOR CONTRACT DOES NOT INTRODUCE NEW 
FLEXIBLE LABOR ARRANGEMENTS (SUCH AS JOB-SHARING AND STAFF 
                       UNCLASSIFIED 
 
PAGE 04        ROME  01360  02 OF 03  311337Z 
LEASING) RECENTLY PASSED BY THE PARLIAMENT; THE LABOR 
MINISTRY IS STILL WRITING THE REGULATIONS TO IMPLEMENT THOSE 
INNOVATIVE PROVISIONS.  HOWEVER, IT DOES CONTAIN NEW MEASURE 
TO FIGHT SEXUAL ABUSE AND OTHER FORMS OF HARASSMENT IN THE 
WORKPLACE. 
 
EMPLOYERS, TRADE UNIONS COOKING UP REMEDIES TO DECLINING 
COMPETITIVENESS 
--------------------------------------------- -------------- 
 
¶9. ITALY'S THREE MAJOR TRADE UNION CONFEDERATIONS HAVE 
LAUNCHED A SERIES OF DISCUSSIONS WITH CONFINDUSTRIA, THE 
PRINCIPAL CONFEDERATION FOR LARGE AND MEDIUM-SIZE COMPANIES, 
ON POSSIBLE SOLUTIONS TO ADDRESS THE DECLINING 
COMPETITIVENESS OF ITALY'S INDUSTRIAL SECTOR.  THE PARTIES 
HAVE CREATED FOUR DISCUSSION FORA TO ADDRESS KEY ASPECTS: 
RESEARCH, INFRASTRUCTURE, TRAINING AND THE MEZZOGIORNO (THE 
SOUTHERN THIRD OF THE ITALIAN PENINSULA, WHICH SUFFERS FROM 
CHRONIC HIGH UNEMPLOYMENT AND COMPARATIVELY LOW INVESTMENT). 
PARTNERED OFF IN THESE FOR A, LABOR AND MANAGEMENT INTEND TO 
DEVELOP JOINT PROPOSALS TO PRESENT TO THE BERLUSCONI 
GOVERNMENT: IN SOME CASES, SPECIFIC PROGRAMS AND PROJECTS 
FOR FUNDING, IN OTHERS ADJUSTMENTS TO LEGISLATION OR 
REGULATION. 
 
¶10. THE FIRST DIRECT CONTACT BETWEEN CONFINDUSTRIA AND THE 
 
                       UNCLASSIFIED 
 
                           UNCLASSIFIED     PTQ7721 
 
PAGE 01        ROME  01360  03 OF 03  311337Z 
ACTION DRL-01 
 
INFO  LOG-00   NP-00    AGRE-00  AID-00   CEA-01   CIAE-00  COME-00 
      CTME-00  INL-00   DINT-00  DODE-00  ITCE-00  DOTE-00  ANHR-00 
      SRPP-00  DS-00    EB-00    EXME-00  EUR-00   OIGO-00  E-00 
      FAAE-00  FBIE-00  UTED-00  VC-00    FRB-00   H-01     TEDE-00 
      INR-00   IO-00    ITC-01   LAB-01   L-00     VCE-00   AC-01 
      NSAE-00  NSCE-00  OMB-01   OPIC-01  PA-00    PER-00   PM-00 
      PRS-00   ACE-00   P-00     SP-00    IRM-00   SSO-00   SS-00 
      STR-00   TEST-00  USIE-00  PMB-00   DSCC-00  PRM-00   G-00 
      SAS-00     /008W 
                  ------------------4D9EBC  311338Z /38 
R 311337Z MAR 03 
FM AMEMBASSY ROME 
TO SECSTATE WASHDC 9034 
INFO DEPT OF LABOR WASHDC 
DEPT OF TREASURY WASHDC 
LABOR COLLECTIVE 
EUROPEAN POLITICAL COLLECTIVE 
 
UNCLAS SECTION 03 OF 03 ROME 001360 
 
SIPDIS 
 
DEPT FOR DRL/IL, EUR/WE, EB/OMA, INR/EUC 
DOL FOR ILAB/PERLMUTTER, BRUMFIELD, LEVINTOW 
TREASURY FOR OASIA HARLOW, CARNES 
 
E.O. 12958: N/A 
TAGS: ELAB ECON PGOV PINR ECON PGOV PINR ECON PGOV PINR IT ITELAB ITELAB
SUBJECT: LABOR ANTIPASTI FOR ITALY 
                       UNCLASSIFIED 
 
PAGE 02        ROME  01360  03 OF 03  311337Z 
 
UNION CONFEDERATIONS IN TWO YEARS, THE TALKS WERE SPURRED BY 
FIATAUTO'S RECENT DIFFICULTIES AND THE BERLUSCONI 
GOVERNMENT'S REACTION TO THE CRISIS (SEE REFS B AND C FOR 
MORE DETAILED ANALYSIS OF FIAT'S DIFFICULTIES).  BOTH LABOR 
AND MANAGEMENT BELIEVE THE GOVERNMENT SHOULD BE DOING MORE 
TO ENCOURAGE AND SUPPORT PRIVATE RESEARCH AND INNOVATION AND 
TO BUILD ON THOSE AREAS, SUCH AS DESIGN, AT WHICH ITALIAN 
INDUSTRY EXCELS.  EVEN IF THE TALKS FAIL TO PRODUCE TANGIBLE 
SPECIFIC RESULTS, THEY COULD FOSTER A MORE PRODUCTIVE 
ATMOSPHERE FOR UPCOMING NEGOTIATIONS OVER PRIVATE SECTOR 
WAGES AND BENEFITS AND A VARIETY OF OTHER WORKPLACE ISSUES. 
 
PARLIAMENT APPROVES SWEEPING EDUCATION REFORM 
--------------------------------------------- 
 
¶11. ON MARCH 12, THE SENATE PASSED THE FIRST MAJOR REFORM TO 
ITALY'S EDUCATIONAL SYSTEM IN 80 YEARS.  THE REFORM PACKAGE 
IS INTENDED TO IMPROVE THE OVERALL QUALITY OF PUBLIC 
EDUCATION.   IN PROVIDING STUDENTS WITH MORE CHOICE AND 
OPPORTUNITIES TO DEVISE A MORE PERSONALIZED EDUCATION, THE 
PACKAGE SHOULD HELP LOWER THE NATION'S CURRENT DROPOUT RATE 
OF 10.5 PERCENT, SUPPORTERS CLAIM.  THE REFORMED SYSTEM 
SHOULD ALSO PRODUCE A MORE VARIED/SKILL-DIVERSIFIED POOL OF 
GRADUATES BETTER PREPARED TO FILL THE REQUIREMENTS OF 
EMPLOYERS IN A CHANGING ECONOMY.  THE REFORM PACKAGE, 
SUPPORTERS ASSERT, IS AN IMPORTANT ELEMENT IN IMPROVING 
ITALY'S COMPETITIVENESS WITH FELLOW EU MEMBER-STATES AND 
OTHER COMPETITORS. 
 
¶12. THE REFORM PACKAGE WILL CREATE A DUAL-TRACK SECONDARY 
                       UNCLASSIFIED 
 
PAGE 03        ROME  01360  03 OF 03  311337Z 
SYSTEM, ADDING A "PROFESSIONAL/VOCATIONAL TRAINING" TRACK TO 
THE CURRENT "CLASSICAL" SYSTEM OF SECONDARY SCHOOLS BUILT 
AROUND CORE CURRICULA (SUCH AS CLASSICS, LINGUISTICS, 
NATURAL SCIENCES AND SOCIAL SCIENCES).  STUDENTS WILL ALSO 
GAIN OPPORTUNITIES TO RECEIVE PRACTICAL TRAINING THROUGH 
APPRENTICESHIP OR INTERNSHIP-STYLE OPPORTUNITIES IN THE 
LABOR MARKET TO COMPLEMENT THEIR TRADITIONAL STUDIES. 
FOREIGN LANGUAGE AND COMPUTER SCIENCE INSTRUCTION WILL BEGIN 
IN ELEMENTARY SCHOOL; A SECOND FOREIGN LANGUAGE WILL BE 
ADDED IN MIDDLE SCHOOL.  STUDENTS WILL BE REQUIRED TO ATTEND 
SCHOOL OR RELATED PROGRAMS FOR AT LEAST TWELVE YEARS. 
FORMAL EDUCATION, PRACTICAL TRAINING PROGRAMS AND LABOR 
MARKET NEEDS WILL BE BETTER INTEGRATED, ALLOWING STUDENTS TO 
GAIN PRACTICAL EXPOSURE TO POSSIBLE PROFESSIONS AND TO 
PERSONALIZE CURRICULUMS. A SIMPLIFIED EVALUATION SYSTEM FOR 
STUDENTS AND NEW RECRUITMENT PROCEDURES FOR PROFESSORS ALSO 
WILL BE INTRODUCED. 
 
¶13. AS IS THE CASE WITH MUCH ITALIAN LEGISLATION, MANY OF 
THE DETAILS TO ACCOMPLISH THESE BENCHMARKS WILL BE HAMMERED 
OUT OVER THE NEXT TWO YEARS VIA IMPLEMENTING REGULATIONS - 
PROVIDING BOTH SUPPORTERS AND CRITICS AMPLE OPPORTUNITY TO 
CONTINUE THEIR ARGUMENT OVER INDIVIDUAL PROVISIONS.  ITALY'S 
CURRENT AUSTERITY BUDGET AND THE FISCAL CONSTRAINTS OF THE 
EU STABILITY PACT ALSO WILL SLOW IMPLEMENTATION; EDUCATION 
MINISTER MORATTI FACES AN UPHILL STRUGGLE TO WRESTLE FROM 
THE FINANCE MINISTRY A SUBSTANTIAL PORTION OF THE BUDGET'S 
EVER-DWINDLING DISCRETIONARY FUNDS.  PRIVATE EMPLOYERS JUDGE 
THE REFORM PACKAGE AN IMPORTANT ACHIEVEMENT THAT WILL 
IMPROVE THE QUALITY OF WORKFORCE; CRITICS, NOTABLY THE 
CENTER-LEFT OPPOSITION, CHARGE IT WILL CREATE/REINFORCE 
                       UNCLASSIFIED 
 
PAGE 04        ROME  01360  03 OF 03  311337Z 
SOCIOECONOMIC CLASSES.   THE MAJOR TRADE UNION 
CONFEDERATIONS ARE SPLIT (AS THEY ARE ON MOST DOMESTIC 
ISSUES THESE DAYS): CISL AND UIL HAVE SAID THEY WILL TRY TO 
SHAPE THE PACKAGE THROUGH DISCUSSIONS OVER THE IMPLEMENTING 
REGULATIONS, WHILE CGIL HAS ANNOUNCED ITS STEADFAST 
OPPOSITION AND PLEDGED TO ORGANIZE A STRIKES AND 
DEMONSTRATIONS TO OPPOSE IT. 
 
SEMBLER 
 
                       UNCLASSIFIED 
 
> 
 2003ROME01360 - Classification: UNCLASSIFIED