Enhancing Employability: Policy
Measures to overcome the Crisis
ITC of the ILO
Based on the ILO position in discussion document for the
Joint ILO-IMF conference
The challenges of Growth, Employment and Social Cohesion
Challenges of growth, employment
and social cohesion
• What is the impact of the GR 07-09 on LM
• Most effective policies in reducing human cost to LM of
GR fiscal and monetary stimulus, short-time work
programmes, provision of unemployment insurance
benefits, job subsidies, etc.
• Can fiscal and monetary policies continue to support
aggregate demand, thus employment in ST 2010-11
• Can short term policies ease the LM pain e.g. short-time
work programmes; provision of unemployment
insurance, be sustained, modified, phased out
• Which policies, e.g. job subsidies, can accelerate
recovery in jobs in the short term?
Challenges of growth, employment and social
• What policy mix is needed to transition from recovery
to strong, sustainable and balanced global growth?
Which policy tools could help ensure the balanced
development of wages and productivity to support
• What training and small enterprise development
policies work best to augment aggregate productivity
growth and overall economic performance?
• Which policies for social protection and inclusive LM
are needed for a more balanced global development?
• How can the roles of collective bargaining, tripartite
consultation and social dialogue be reinforced?
• How can policy coherence for a fairer globalization be
improved, including between macroeconomic and
employment and social market policies?
The human cost of recessions:
Assessing it and reducing it
• Dire state of labour markets: Over 210 million people across
the globe are estimated to be unemployed at the moment, an
increase of more than 30 million since 2007
• Unemployment rates in advanced economies: The
unemployment rate has increased by 3percentage points in
advanced countries since 2007 and by a ¼ percentage point in
• Youth unemployment: Historically, the unemployment rate for
youth (15–24 age group) has been two-and-a-half times
higher than for older age groups.
• Long-term unemployment: The share of long-term
unemployed has increased in most OECD countries since 2007
The human cost of unemployment
• Lower lifetime earnings
• Cost to health
• Cost to children
• Increasing wage inequality
• Income gaps widen in many countries
• Rise of insecure work
• Wage share declines
Creating decent work opportunities
Structural change and the emergence of a global LM
• Growing world labour force
• Working poverty and informal work
• High youth unemployment
• Rural–urban migration
• High unemployment and an ageing population
in advanced countries
Macroeconomic management, the
recovery, inequality and growth
• Immediate macroeconomic policy challenges
• Longer-term challenges for economic policy
• Inequalities and economic stability
• Global imbalances and policy responses
Employment and social policies
Priorities for strengthening labour markets - Strengthening
mechanisms for wage determination
• Minimum wages
• Social dialogue and collective bargaining
• Tripartite consultations and negotiations on
economic and social policies
Promoting productivity through
support for mobility, skills and small
• The role of employment protection legislation
• Supporting micro-, small and medium-sized
• Boosting training and skills development
Creating inclusive labour markets and
extending social protection
• Strengthening public and private employment
• Targeting employment programmes to
• The role of social protection policies
• Measures to maintain employment and facilitate job-tojob
transitions (e.g. short-time working)
• Measures for the unemployed: Passive measures
(changes to level and coverage of unemployment
benefits) and active measures (job search assistance,
subsidies for employers)
• Increased emphasis on training, re-training and upskilling
• Training measures are frequently being targeted at
vulnerable job seekers (e.g. young people in the UK and
in Finland, low-skilled construction workers in Ireland,
recent migrants in Norway)
Short-time working/partial unemployment
• State support for short-time working measures has been
accompanied by provisions designed to encourage employers
to provide additional training opportunities.
• In the Netherlands and Slovenia, employers are obliged to
enable partially-unemployed workers to participate in
• Austrian employers are entitled to a training subsidy if they
provide training courses for workers who are on short-time
• Germany: In cases where short time working is supplemented
with training, the PES pays 100% of the social security
• The Czech ‘Educate Yourself’ project compensates employers
who provide training.
Measures for the unemployed
• Germany: additional funding for unemployed workers to
retrain as nurses to meet future demand in the social care
• Ireland: increased provision of night class training places. The
places will be provided free of charge to the unemployed.
• Norway: increased funding for training for unemployed or
• Poland: Expansion of training programmes for the
unemployed and increase in income support for unemployed
workers taking part in training, on-the-job training or
Supporting training for the unemployed
• France: ‘Occupational transition contracts’ are aimed at
redundant workers. They provide workers with 80% of their
gross pay for one year, during which time workers undertake
vocational training. €1.5 billion for the Social Investment Fund
to support retraining during the crisis.
• Italy: training vouchers for the unemployed
• Netherlands: Grants for retraining workers threatened by
redundancy. Reimbursement of training costs for employers
that allow unskilled workers to take part in accreditation of
prior learning programmes.
• Measures to assist workers who cannot claim unemployment
benefit (Canada, Japan).
• Young people have been disproportionately affected by the
• The French government is offering a one-off payment of
€1,000 (€2,000 in the case of ‘unskilled’ workers) to people
under 26-years of age if they sign a contract to work and train
(contrat de professionnalisation) in a small enterprise
between April 2009 and June 2010.
• In 2009 the UK government launched a ‘Young Person’s
Guarantee’ initiative which will, from January 2010, guarantee
all 18-24 year olds who are still NEET after 10 months a place
in employment, education or training.
• Additional support for apprentices is widespread.
Employability and collective bargaining
• Training has been part of a negotiated response to
• For example, in 2007 Austria’s social partners
developed a proposal for measures to improve
employment opportunities for the unskilled,
unemployed and young people.
• Agreements have been reached at sectoral level (e.g.
in the French and Italian chemical sectors).
• Agreements have also been reached at company
• The emphasis placed on training and other
measures to improve employability has increased
• Policies have addressed the needs of specific
groups (e.g. the young, migrants)
• There are signs of planning for future skill ‘needs’
• Extension of entitlements and introduction of