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Session 3. National Employment Strategies and Policies: The International Context

Session 3. National Employment Strategies and Policies: The International Context. Makiko Matsumoto Employment Strategy Department, ILO 25 May 2004, Turin. Outline. Motivation ILO instruments Key components of National Employment Policy (NEP). Why Employment Policy?.

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Session 3. National Employment Strategies and Policies: The International Context

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  1. Session 3. National Employment Strategies and Policies:The International Context Makiko Matsumoto Employment Strategy Department, ILO 25 May 2004, Turin

  2. Outline • Motivation • ILO instruments • Key components of National Employment Policy (NEP)

  3. Why Employment Policy? • Answer determines the functional role to be given to a national employment policy • General economic policies may not be sufficient in addressing employment concerns • Over time, provide coherence and balance to various measures and programmes/projects related to labour market • Motivations and justifications: economic, social and political • Monitoring labour market situations for identifying areas of policy interventions and adjustments

  4. Key ILO Instruments • Employment Policy Convention (C122) • ILO Global Employment Agenda (GEA)

  5. Convention 122 (1964) • Objective: An employment policy to stimulate economic growth and development, based on full, productive and freely chosen employment • Work for all • Productive work • Freedom of choice of employment

  6. Convention 122 (cont.) • Adaptation of national employment policy to: • The level of economic development • Coordination of objectives: employment and other socio-economic • Participation of employers, workers and the persons affected during policy formulation and implementation

  7. ILO Global Employment Agenda • Approved by GB in March 2003 • Objectives: • Quantity and quality of employment • Better functioning labour markets • Approach: demand and supply side • Identification of policy-specific areas of intervention : 10 core elements

  8. ILO GEA : The Structure 1 • Enhancing demand for employment through stimulation of the economy: • Trade and investment • Technological change • Sustainable development • Macroeconomic policy

  9. ILO GEA : The Structure 2 • Addressing the supply side of employment: • Entrepreneurship • Knowledge and skills development • Active labour market policies • Social protection • Occupational safety and health • Productive employment for poverty reduction

  10. ILO GEA : The Structure 3 • Cross-cutting issues: • Social dialogue • Non-discrimination – ethnicity, race, gender, age

  11. ILO GEA : Implementation • 3 levels: • National – national employment plans • Regional – meeting regional strength, comparative advantages and needs • Global – international policy coordination and alliance building

  12. ILO Instruments - Implications • Priority identification: adaptation of general guidelines on employment policies to specific national socio-economic and policy environment • Policy mix needs to address both demand and supply side of the labour market – this will require inter-ministerial cooperation • Stake-holder dialogue and participation is the key to policy process in formulation and implementation

  13. Components of NEP: The Minimum Set National priorities LMI and analysis Policy objectives 0.5, 1, 2 years Component 1 Component 2 Component 3 Financing Implementation Financing Implementation Financing Implementation Review Dialogue

  14. Objectives and priorities : long and short-term, clarity and feasibility Simple situational analysis : labour market information Policy scopes and proposed policy reform components: coherence, action-oriented clarity, relevance and feasibility Review: assessment method and frequency Financing Continuous dialogue with social partners and key stakeholders from the initial formulation stage to implementation Components of NEP: The Minimum Set

  15. Objectives of EP: Examples • European Employment Strategy • Launched in Luxembourg Jobs Summit in Nov 1997: • High level of employment (equally important as growth and stability) • To achieve decisive progress in employment promotion within 5 years • New goal set in Lisbon Economic Council Mar 2000: • EU to become the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion by 2010 • Targets: Employment rate should reach 70%, at least 60% for women and 50% for older workers by 2010

  16. Analysis & monitoring: Example • EU Employment Strategy guideline for monitoring indicators, for instance: • Unemployment and employment rates, including long-term unemployment • Growth in labour productivity • Enterprise birth • Employment growth, • Etc. • Reference: http://europa.eu.int/comm/employment_social/employment_strategy/indic/list_from_compendium_jer2002.pdf

  17. Policy Scopes of NEP:Examples and lessons • In Europe, including the EU accession countries and others wishing to join the EU, main issues addressed by the NEPs tended to be: • Focus on the supply side measures, with more focus on education and training of youth. Adult training underdeveloped in a number of countries • Labour market flexibility and employment secuirty dilemma • Trend towards activation of labour market policy (but large differences exist across countries)

  18. Policy Scopes of NEP:Examples and lessons (cont.) • Special programmes for disadvantaged groups (youth, elderly, women, disabled persons, ethnic minorities) • Employment and social policy not always well coordinated • Promotion of entrepreneurship needs improvement • Employment promotion and wage bargaining working well in some countries • Stimulation of job creation through economic incentives (special economic zones)

  19. Review: Example • EU Employment Strategy • Country review and assessment of progress of National Action Plans on employment, monitoring indicators • Peer reviews – identification and exchange of good practices and potential for transfer in other countries • Frequency of review: in line with policy life cycle, financing and capacity availability.

  20. Financing: Example • In many European NEPs, for each proposed policy measures, financing means and implementation units are identified. • Examples of financing means: • State budget • Savings arising from proposed policy changes • Collaboration of budget with other ministries co-responsible for implementation

  21. NEP:Some lessons and challenges • Lack of coordination between economic and employment policy • Weak labour demand due to low economic growth, low employment-intensity of growth, obstacles to good enterprise development (particularly SMEs), low pace of restructuring of SOEs • Education and training policies not fully in compliance with labour market needs • Labour market institutions and policies severely underdeveloped • Weak social protection systems, covering only parts of population • Social dialogue often underdeveloped and contributing little to good employment policy formulation and implementation

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