Measures to overcome the Crisis
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Enhancing Employability -

Enhancing Employability: Policy

Measures to overcome the Crisis

Yordanka Tzvetkova

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

cohesion (Continued)

• 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

sustainable growth?

• 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

emerging markets.

• 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

Widening inequality

• 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

disadvantaged communities

• The role of social protection policies

Employment measures

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

marginally-employed immigrants

• 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

• 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

the crisis.

• 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

new entitlements.

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