Institute for Research on Labor and Employment

We discuss an emerging employment system characterized by a high degree of employment security with flexible job assignments, employee involvement in problem solving and continuous improvement, and continuous training of employees. We call this model the SET system (for Security, Employee involvement and Training) and examine case studies of five U.S. firms that are attempting to establish or maintain a SET system. We find that SET systems are difficult to implement in a gradual and partial manner. The three elements of SET reinforce one another and firms that are successful in adopting SET have made an investment to implement all three SET elements simultaneously.