Trade union training on employment policies ITCILO, Turin, March 2004.
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Transcript of Trade union training on employment policies ITCILO, Turin, March 2004.
Trade union training on employment policiesTrade union training on employment policies
ITCILO, Turin, March 2004ITCILO, Turin, March 2004
Trade union training on employment policiesTrade union training on employment policies
ITCILO, Turin, March 2004ITCILO, Turin, March 2004
Labour market policiesLabour market policiesConcepts and definitionsConcepts and definitions
Presented by Nicolas Serrière, ITCILOPresented by Nicolas Serrière, ITCILO
Key words and conceptsKey words and concepts labourlabour
Labour forceLabour force
Labour marketLabour market
Labour market informationLabour market information
Labour market analysisLabour market analysis
Labour market policyLabour market policy
Labour force – stocks and flowsLabour force – stocks and flows
stocks
31 December 2002
stocks31 December 2003
leaving entering
staying
flows
The labour marketThe labour market
The labour marketThe labour market
exchange
supply demand
allocation and price
determination
production exchange utilisation
The labour marketThe labour market
supply demand
The labour marketThe labour market
Worker or potential worker
Employer, or employment opportunity
The labour marketThe labour market
Virtual spaceVirtual spaceIn which are matched, in a more or less In which are matched, in a more or less
organised manner…organised manner…
The supply and demandThe supply and demandOf all sorts of labourOf all sorts of labour
And in which wagesAnd in which wagesAre determined.Are determined.
0
10
20
30
40
50
60
1998 1999 2000 2001
demand
supply
industrialised countries
The labour marketThe labour market
0
10
20
30
40
50
60
1998 1999 2000 2001
demand
supply
developping countries
The labour marketThe labour market
0
10
20
30
40
50
60
1998 1999 2000 2001
demand
supplyStructural over-supply
The labour marketThe labour market
developing countries
Employment in developping countriesEmployment in developping countries
Wageemployment
Own-accountemployment
rural urban
Informal economy
Segmentation by, for example:Segmentation by, for example: geographic locationgeographic location gendergender industrial sectorindustrial sector occupationoccupation level of incomelevel of income level of educationlevel of education formal or informal sector formal or informal sector
The labour marketThe labour market
A free market?A free market?
= No government intervention= No government intervention
= = in a “free market”, demand and supply in a “free market”, demand and supply (the “market forces”) determine (the “market forces”) determine together the price of labour and, hence, together the price of labour and, hence, how much of it will be employedhow much of it will be employed
It doesn’t exist!It doesn’t exist! Labour is not a commodityLabour is not a commodity
Workers have rightsWorkers have rights Workers have preferencesWorkers have preferences
Competition is never perfectCompetition is never perfect Contractual relations are biasedContractual relations are biased There is a lack of informationThere is a lack of information
Decisions are subject to regulationsDecisions are subject to regulations Whether formal or notWhether formal or not
A free market?A free market?
Which regulations?Which regulations?
official (laws and decrees)official (laws and decrees)Employment, laying off, security at Employment, laying off, security at
workworkMinimum wageMinimum wage
Collective negotiationCollective negotiationWage and working conditionsWage and working conditions
Shaped by the marketShaped by the marketMobility, availability of specific skillsMobility, availability of specific skills
International regulationsInternational regulations
the ILO Declaration on Fundamental the ILO Declaration on Fundamental Principles and Rights at Work (1998)Principles and Rights at Work (1998) freedom of association and the effective right to freedom of association and the effective right to
collective bargainingcollective bargaining the elimination of all forms of forced or the elimination of all forms of forced or
compulsory labourcompulsory labour the effective abolition of child labourthe effective abolition of child labour the elimination of discrimination in employment the elimination of discrimination in employment
and occupationand occupation
Factors affecting labour marketsFactors affecting labour markets
affecting both supply and demand sideaffecting both supply and demand side
failing institutionsfailing institutions labour market informationlabour market information
political instability, conflictpolitical instability, conflictnatural disastersnatural disastershealth criseshealth crises
factors affecting labour marketsfactors affecting labour markets
affecting the supply sideaffecting the supply side
population growthpopulation growthchanges in labour force participationchanges in labour force participationmigration within and between countriesmigration within and between countriesthe state of education and trainingthe state of education and training
factors affecting labour marketsfactors affecting labour markets
affecting the demand side:affecting the demand side:economic/financial criseseconomic/financial criseschanges in economic structurechanges in economic structuretechnological change (ICT!)technological change (ICT!)
process innovationprocess innovation product innovationproduct innovation
globalisationglobalisation
selected labour market issuesselected labour market issues
gender issuesgender issues
child labourchild labour
youth unemploymentyouth unemployment
people on the movepeople on the move
HIV/AIDSHIV/AIDS
two questions:two questions:
does your country face serious does your country face serious employment (-related) problems of any employment (-related) problems of any sort?sort?
what can the government do about it?what can the government do about it?
answer:answer: it is the main business of the government,it is the main business of the government, based on adequate information, based on adequate information,
to design and implement policies to design and implement policies
meant to prevent or to correct problems meant to prevent or to correct problems affecting the country and its population affecting the country and its population
Proportion of people living on less Proportion of people living on less than $1 a day (%)than $1 a day (%)
1990
19992015
Progress to date
Rate of progress needed to meet goal
South Asia
3644
22
01020304050
1990 2015
Sub-Saharan Africa
4648
24
01020304050
1990 2015
East Asia Pacific
14
28
14
01020304050
1990 2015
Middle East and North Af rica
221
02468
10
1990 2015
Europe and Central Asia
4
21
02468
10
1990 2015
Latin America and the Caribbean
1517
8
01020304050
1990 2015
labour market policieslabour market policies
measures meant to address failure in measures meant to address failure in labour markets, in particular measures that labour markets, in particular measures that reduce unwanted distortions in the process reduce unwanted distortions in the process of supply meeting demand.of supply meeting demand.
labour market policieslabour market policies
for whom are these policies for whom are these policies intended?intended?
whom do they actually benefit?whom do they actually benefit?whom do they by-pass?whom do they by-pass?
labour market policieslabour market policies
production exchange use
supply demand
labour market policieslabour market policies
production
e.g. investing in human resources
exchange
e.g. labour market information
labour market policieslabour market policies
use
e.g. social protection
labour market policieslabour market policies
active labour market policiesactive labour market policies
the primary objectives are…the primary objectives are…
the placement of the unemployedthe placement of the unemployed
the improvement of the productivity and the improvement of the productivity and income of the under-employedincome of the under-employed
active labour market policiesactive labour market policies
3 main tools to carry out these objectives:3 main tools to carry out these objectives:
Public employment servicesPublic employment services
training programmestraining programmes
direct job creation programmes (wage or direct job creation programmes (wage or self-employment)self-employment)
active labour market policiesactive labour market policies
for instance…for instance…
facilitating the contact between workers and facilitating the contact between workers and employers (e.g. job search assistance, public employers (e.g. job search assistance, public employment services, mobility incentives) employment services, mobility incentives)
increasing the supply of needed skilled workers increasing the supply of needed skilled workers (e.g. training of the unemployed, specific (e.g. training of the unemployed, specific programmes for the disabled)programmes for the disabled)
increasing the demand for workers (e.g. direct job increasing the demand for workers (e.g. direct job creation, incentives to employers, self-creation, incentives to employers, self-employment/ SME promotion)employment/ SME promotion)
ALMPs: public employment ALMPs: public employment servicesservices
keep a record of job seekers’ requestskeep a record of job seekers’ requests match as much as possible employers’ match as much as possible employers’
needs with job seekers’ requestsneeds with job seekers’ requests register the unemployed for their register the unemployed for their
unemployment benefitsunemployment benefits
ALMPs: training programmesALMPs: training programmes
they have a dual rolethey have a dual role
improve the productivity of the employedimprove the productivity of the employed
improve the employability of the improve the employability of the unemployedunemployed
ALMPs: training programmesALMPs: training programmes
they mainly target:they mainly target:
the youththe youth womenwomen the unemployed, and especially the long the unemployed, and especially the long
term unemployedterm unemployed the disabledthe disabled
ALMPs: employment supportALMPs: employment support
4 kinds of employment support programmes4 kinds of employment support programmes
employment creation in the private sectoremployment creation in the private sector employment creation in the public sectoremployment creation in the public sector self-employment assistanceself-employment assistance support for vulnerable or specific groups support for vulnerable or specific groups
(disabled, women...)(disabled, women...)
ALMPs: direct job creationALMPs: direct job creation
in the private sectorin the private sector
recruitment incentives recruitment incentives subsidies (on social contributions, wages)subsidies (on social contributions, wages) tax incentivestax incentives
ALMPs: direct job creationALMPs: direct job creation
in the public sector, to reactivate the economyin the public sector, to reactivate the economy
public services (maintenance of local public services (maintenance of local infrastructure)infrastructure)
public workspublic works
aim must be to create sustainable aim must be to create sustainable employmentemployment
ALMPs: providing support for ALMPs: providing support for self-employmentself-employment
by providing credit equal to the total amount by providing credit equal to the total amount of unemployment benefitsof unemployment benefits
promoting funds for enterprise creationpromoting funds for enterprise creation
ALMPsALMPs
On the positive side…On the positive side…
Improve matching between supply and demandImprove matching between supply and demand Reduce discouraged-workers effectReduce discouraged-workers effect Keeps wage pressure low, and therefore pushes Keeps wage pressure low, and therefore pushes
supply highersupply higher Improves productivity, profitability and Improves productivity, profitability and
competitiveness of workerscompetitiveness of workers
ALMPsALMPs
The risks…The risks…
Deadweight lossDeadweight lossPaying to help those who would find work anyway!Paying to help those who would find work anyway!
Substitution effectSubstitution effectNo new jobs creation, if those helped only get someone No new jobs creation, if those helped only get someone
else’s jobelse’s job Displacement effectDisplacement effect
Wage subsidies creating unfair competitive advantage Wage subsidies creating unfair competitive advantage and pushing other firms to lay off workersand pushing other firms to lay off workers
passive labour market policiespassive labour market policies
primary objective: income support to the primary objective: income support to the unemployedunemployed
relevant particularly in industrialised relevant particularly in industrialised countries (or those with capacity: Korea)countries (or those with capacity: Korea)
passive labour market policiespassive labour market policies
primary objective: income support to the primary objective: income support to the unemployedunemployed
early retirementearly retirement severance payseverance pay unemployment insuranceunemployment insurance unemployment assistanceunemployment assistance public works programmespublic works programmes
Thank youThank you