With 25 years of sluggish economic growth, Japan’s per capita income has fallen from a level matching the average of the top half of OECD countries in the early 1990s to 14% below that today. Weak growth, together with rapid population ageing, has driven public debt into uncharted territory. Revitalising growth is thus the top priority for the Japanese government. With the labour force shrinking more rapidly than the population, per capita output can only grow through improvements in labour productivity and labour force participation. Japan’s highly-skilled labour force and its technological leadership can help close the gap with leading OECD countries in per capita income. But broad-based structural reforms, as envisaged in the third arrow of Abenomics, are needed to allow these strengths to fully achieve their potential. The initial impact of Abenomics in 2013 was impressive, and the reform process needs to continue.
Digitalisation, globalisation, demographic shifts and other changes in work organisation are constantly reshaping skill needs. This can lead to persistent skill shortages and mismatch which are costly for individuals, firms and society in terms of lost wages and lower productivity and growth. These costs can be reduced through better assessment and anticipation of changing skill needs and by improving the responsiveness of skills development to these changes.
This report identifies effective strategies for improving labour market information on skill needs and ensuring that this information is used effectively to develop the right skills. It provides a comparative assessment of practices across 29 countries in the following areas: i) the collection of information on existing and future skill needs; ii) the use of this information to guide skill development policies in the areas of labour, education and migration; and iii) governance arrangements to ensure good co-ordination among the key stakeholders in the collection and use of skill needs information.
Job displacement (involuntary job loss due to firm closure or downsizing) affects many workers over their lifetime. Displaced workers may face long periods of unemployment and, even when they find new jobs, tend to be paid less and have fewer benefits than in their prior jobs. Helping them get back into good jobs quickly should be a key goal of labour market policy. This report is the fourth in a series of reports looking at how this challenge is being tackled in a number of OECD countries. It shows that many displaced workers get new jobs relatively quickly in Australia, mostly thanks to a flexible and dynamic labour market. A small minority of displaced workers receive special support via the labour adjustment programmes, but some displaced workers who would need specific assistance, in particular in the older worker and/or low-educated groups, do not get sufficient support or only too late. There is room to improve policies by moving away from the current sectoral approach to special assistance programmes for workers collectively dismissed, towards an approach covering all sectors of the economy, with the intensity of intervention tailored to the circumstances and needs of the displaced workers. Expanding the training component for displaced workers and making use of skills assessment and training to better target the training and enhance its effectiveness would also help displaced workers transition to sustainable jobs of a certain quality.
Australia should provide early access to more intensive employment services for disadvantaged laid-off workers to help them find a new job more quickly, according to a new OECD report.
Latvia has undergone major economic and social change since the early 1990s. Despite an exceptionally deep recession following the global financial crisis, impressive economic growth over the past two decades has narrowed income and productivity gaps relative to comparator countries in the OECD. But Latvians report low degrees of life satisfaction, very large numbers of Latvians have left the country, and growth has not been inclusive. A volatile economy and very large income disparities create pressing needs for more effective social and labour-market policies. The government’s reform programme rightly acknowledges inequality as a key challenge. However, without sustained policy efforts and adequate resources, there is a risk that productivity and income growth could remain below potential and social cohesion could be further weakened by high or rising inequality.
Today the OECD is launching a new project with JP Morgan and Chase Foundation to measure and analyse skills needs in a harmonized way across countries. Experts from various countries and fields of discipline are meeting at the OECD to discuss methodological issues involved in developing a cross-country indicator of skill needs. By informing policy, this new data tool will make strides towards addressing skill shortages.
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The Organisation for Economic Cooperation and Development (OECD) and J.P. Morgan through its Foundation today launched a new project “Adapting to Changing Skills Needs” to fill knowledge gaps in the assessment of skill mismatches and to identify international best practice in addressing them.
A discussion on how can we reconcile the apparently contradicting views of labour market demand for soft skills versus technical job-specific skills.
Openness to change and a continuous questioning of the way we work are the keys to being prepared for the Future of Work. This advice comes from Mark Keese, Head of the Employment Analysis and Policy Division at the OECD, and we catch up with Mark following the OECD's Future of Work Forum in January 2016.
OECD Unit Labour Cost growth picks up to 0.5% in the fourth quarter of 2015