Enhancing equal access to opportunities for all in G20 countries
How can the G20 address key challenges in enhancing equal access to opportunities?
Over recent years, globalisation, digitalisation, demographics and climate change have been transforming the way economies work. These trends have provided new opportunities for growth, but also deepened inequalities as the gains from growth have not been shared evenly amongst all. The COVID-19 pandemic – a global public health crisis without precedent in living memory – is resulting in a significant decline in economic activity and surge in unemployment in many countries. It may thereby be speeding up some of these pre-existing trends and further widening existing inequalities in access to opportunities.
The G20 provides a unique forum to examine and monitor key challenges to access to opportunities in G20 countries and to share experiences on the appropriate, feasible and effective policy measures to enhance equal access to opportunities. G-20 Finance Ministers and Central Bank Governors mandated the G-20 Framework Working Group (FWG) under the 2020 Saudi Presidency to develop a Menu of Policy Options that countries can draw from to enhance access to opportunities for all. This paper supports the Menu of Policy Options. It outlines four key challenges in enhancing equal access to opportunities over people’s lives and proposes policy options on how G20 countries, particularly how their Ministries of Finance, can address these challenges to enhance access to opportunities in G20 economies in the long-term, post-COVID-19 environment. Read the full report
Areas of Reform for G20 Economies
Challenge 1: Enhancing access to opportunities for youth.
Childhood and adolescence are crucial times for young people to obtain the necessary skills to succeed throughout their lives. However, individuals’ socio-economic background plays a major role in determining health and educational outcomes over this period. OECD PISA results show that students from disadvantaged backgrounds perform less well than advantaged students in reading, mathematics and science. Many young people struggle to gain a solid foothold in the labour market upon leaving school, with around 19% of 15-29 year-olds being not in employment, education or training (NEET) on average across G20 economies. The COVID-19 pandemic has the potential to further reinforce these disparities. Policy options to help youth access opportunities include ensuring access to quality early childcare education and care, as well as policies, including social benefits, to lift children out of poverty so that they can make the most of these educational opportunities. Effective employment and social support can help young people to successfully transition from the educational system to the labour market.
Challenge 2: Enhancing access to opportunities for women through good-quality employment.
Despite major improvements, across G20 economies women still do not have the same labour market opportunities as men: women are less likely to participate in the labour market and on average employed women work in jobs of poorer quality, with lower earnings and a greater incidence of part-time work and informality. Consequently, the COVID-19 pandemic risks having a greater impact on women. Policy makers can contribute to increasing women’s labour market participation by expanding access to quality formal childcare, reforming paid family-leave policies and strengthening long-term care systems. There is also potential for policy makers to continue reducing the gender gap in earnings and the incidence of low pay by tackling gender segregation by occupation, through fighting and eliminating gender biases and stereotypes, attracting more women into careers in science, technology, engineering and mathematics and increasing the representation of women in leadership positions.
Challenge 3: Enhancing access to opportunities for SMEs and entrepreneurs and tackling informality to ensure good-quality job opportunities.
While regulatory barriers for SMEs and job formalisation have declined over recent years, the take-up of structural reforms has moderated and regulatory barriers remain. Access to finance is crucial for SMEs, and digital technologies are offering new opportunities to improve SME’s access to finance. The COVID-19 pandemic further emphasises the importance of access to finance, as many SMEs are facing dramatic revenue losses and potential liquidity shortages. Informality remains widespread across G20 emerging market economies: job quality remains substantially lower for workers with informal jobs, with often poor health and safety conditions at work and a lack of access to social safety nets. These factors can put informal workers particularly at risk during the COVID-19 pandemic. Options for levelling the playing field for SMEs and encouraging job formalisation include: creating a business-friendly environment and ensuring effective labour market regulation; keeping labour taxes moderate; strengthening compliance and increasing the perceived benefits of formal employment.
Challenge 4: Helping workers make best use of their skills in a changing world of work.
New technologies have been replacing workers in many middle-skill routine occupations while creating new jobs at both the high and low ends of the skills spectrum. This trend is making some workers’ skills redundant while requiring more of others. The COVID-19 pandemic may be intensifying this transformation, further shifting the demand for labour across sectors and speeding up digitalisation. In this context of rapidly transforming labour markets, effective adult learning policies can give workers the opportunity to upskill and reskill throughout their careers. This could include reducing financial and time barriers to taking up training, linking training to workers rather than jobs and ensuring that education and training programmes respond to skill demand.