Labour Market Forum 2010 - Planning Institute of Jamaica

Introduction
In a nutshell the labour market is the fulcrum of
macroeconomic adjustment. Putting an economy on path for
robust output growth through fiscal contraction depends
critically on an accommodating labour market response. My
presentation today is titled “The PIOJ Perspective: The Role of
the Jamaican Labour market in a Contracting Fiscal
Environment” will highlight some aspects of the required labour
market response.
For a variety of well documented reasons, Jamaica has long
suffered from economic underperformance and low economic
growth.
Faced with the pressures from an underperforming
economy, successive governments sought to grow the
economy and maintain some semblance of a working social
infrastructure through increased borrowing on the capital
market to supplement the country’s small and inadequate tax
base and low tax compliance. This in turn led to large and
expanding public sector debt, whose financing needs put
16