18 trade & finance
Labour activation, equity and inclusion
Photo: OECD
Angel Gurría, Secretary-General of the OECD
Never has it been more important for the G20 Labour and Employment Ministers to come together to address the challenges facing the global economy.
According to our Employment Outlook, unemployment is set to remain high in the OECD area, around 8 % well into 2014, not very far from the peak reached at the depth of the crisis in 2009. But there are also growing disparities across countries; while unemployment is gradually declining in the United States, Mexico and Japan, it is increasing in the Euro area. In emerging economies, tackling low paid employment in insecure jobs with little social protection remains a key challenge.
The impact of the crisis has been extremely harsh for youth. In fact, youth unemployment has risen to alarming levels: exceeding 60 % in Greece, 55 % in Spain, 52 % in South Africa and approaching 40 % in countries like Italy. To compound things further, as countries shift their fiscal stance from stimulus to tackling unprecedented deficits, pressure on social spending continues to increase further.
Declining job prospects, rising unemployment, diminished social spending and rising inequalities- never has your role as Labour and Employment Ministers been so important to promote inclusive growth and jobs.
In the context of this session on“ Labour Activation, Equity And Inclusion” I would like to share with you the OECD’ s assessment of the urgent need to address some key labour market challenges.
High unemployment cannot be addressed without a return to sustained growth
Macroeconomic policies – supportive monetary policy, fiscal consolidation, and banking sector reform – remain vital. These must be complemented by a broad range of structural reforms.
Increasing competition and productivity through product market reforms and labour market reforms is essential to deliver more and better jobs. The OECD was called on by the G20 Leaders to monitor progress with structural commitments under the Framework for Strong, Sustainable and Balanced Growth. It is crucial that employment measures have a central role in this process and that you, as Labour and Employment Ministers, be closely involved.
Macroeconomic and structural policies are just two key parts of the solution to re-ignite and strengthen economic growth and job creation.
Activation strategies for stronger and more inclusive labour markets
At the same time, the OECD’ s background report on“ Activation Strategies for Stronger and more Inclusive Labour Markets in G20 Countries”, highlights the critical role of activation policies in all G20 countries to build more inclusive labour markets. This can be achieved by taking action now to help youth and the long‐term unemployed get( back) to employment quickly and to strengthen the labour market attachment of other groups that face significant employment barriers, such as women, migrants, the disabled and older workers.
The objective of these policies is to complement short-term policies to promote job creation and economic growth. But there are significant longterm gains to be achieved, which can be visible in lowered poverty and strengthened well-being, reduced economic and social inequalities and ultimately stronger, more resilient, economies and labour markets.
There is no‘ magic formula’ for designing effective activation policies conducive to more inclusive labour markets
Based on the wide range of experiences and good practices reviewed, there are three key areas where lessons can be learned from G20 countries in developing and implementing activation strategies:
First, a comprehensive strategy along various lines of action, carefully tailored to each country’ s circumstances, is required. The responsiveness and effectiveness of activation policies have, in many countries, been improved by overarching institutional reforms to improve coordination and coherence in the provision and delivery of both social protection measures and employment services.