Joining the world of work has been a rite of passage for centuries. But what does working life in the 21st century look like – and what are the social and economic consequences of a world where, for millions, no job and no immediate prospect of one marks the transition to adulthood?
Work may not make the world go round, but it is an important aspect of our lives and without it our economies and societies could not function. Getting people back to work is a vital part of the equation as governments struggle to reduce high debt levels and restore lasting economic health.
Jobless figures soared during the economic and financial crisis, and there are still 13 million more people out of work in OECD countries than before the crisis struck. People are concerned that if job creation does not get a boost, we may be headed for a period of persistent high unemployment, bringing with it both economic and social costs for years to come. This is particularly true of young people – 17.4% of the under-25s in OECD countries are without a job, compared with 7% of over-25s.
What can be done for jobless youth, and for the many millions of others without work at a time of high public debt and reduced public spending? There is no magic solution to these problems, but better unemployment policies can limit the damage and help to deliver better lives.
Governments should focus on cost-effective measures that achieve results, such as well-designed hiring subsidies – President Barack Obama’s proposed Jobs Act, for example, would waive employer payroll taxes for companies expanding their workforce.
And scarce resources should be concentrated on the most vulnerable groups in society. Income support for the unemployed should be maintained or even reinforced where the long-term unemployed face a serious risk of falling into poverty and exclusion. This should be accompanied by policies to help people get back into the workforce, such as access to training, the OECD says. If you have no job to go to, you have time to acquire new skills to meet new employer needs.
Will this work? Well, some OECD countries, including Australia, Japan, Korea and the Netherlands have managed to contain the increase in unemployment while Germany has actually reduced unemployment during the crisis. And youth unemployment and protecting the most vulnerable are high on the agenda for the G20 labour ministerial meeting to be hosted by France on September 26-27.
One thing is clear. At a time of tight budgets when every dollar, euro, yen or pound of spending is under the microscope, investing efficiently in the labour force is essential.
“Of all the facets of this crisis, from sovereign debt to banking, high unemployment is the elephant in the room. This is the human face of the crisis, the most visible manifestation of the challenge we face to restore sustained growth”
OECD Secretary-General Angel Gurría
Launch of the OECD Employment Outlook 2011 (Read full speech)