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Employment in a pro-poor growth strategy

Employment in a pro-poor growth strategy. Paper presented at the ACTRAV course on “Trade union research and employment policies” Turin, 21 May 2008 M. Muqtada Senior Adviser, Policy Planning, Office of the Executive Director, Employment Sector, ILO, Geneva. 1. The context.

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Employment in a pro-poor growth strategy

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  1. Employment in a pro-poor growth strategy Paper presented at the ACTRAV course on “Trade union research and employment policies” Turin, 21 May 2008 M. Muqtada Senior Adviser, Policy Planning, Office of the Executive Director, Employment Sector, ILO, Geneva

  2. 1. The context ILO’s Decent Work agenda To promote opportunities for women and men to obtain decent and productive work, in conditions of freedom, equity, security and human dignity. • Fundamental principles and rights at work (core labour standards); • full, productive, freely-chosen employment (Convention 122); • social protection; • social dialogue and participation.

  3. 2. Growth-poverty nexus - Long-run; short-run relationships; - Poverty elasticity: distributional issues; - Causality; - Variations in relationships.

  4. 3. Table 1: Varying rates of GDP growth and poverty: Some examples Source: R. Islam (ed.) Fighting poverty: The development-employment link, Lynne Rienner, London, 2006.

  5. 4. Growth: pro-poor growth • Do we have an acceptable definition of PPG? • Should there be specific indicators? Targets? • Monitoring? • Poverty • Employment • Working poor • Growth and poverty alleviation: trade-offs?

  6. 5. Employment: A core link in growth-poverty nexus • Sustained growth with rising productivity • Employment intensity of growth — Sectoral composition of output and employment — Choice of technology — Terms of trade • The ability of the poor to integrate into the growth process [education, skills, assets, participation] • An integrated approach

  7. 6.Declining employment intensity of growth is a global trend… • Globally, for every 1% of GDP growth, total global employment grew between 0.30 and 0.38 during the three periods between 1991 and 2003 • In the most recent period there was a slight decline in GDP growth and a marked reduction in the employment intensity of growth Global employment elasticities 1991-2003 Source: ILO, Key Indicators of the LabourMarket - KILM- Fourth Edition, 2006 (based on 160 countries).

  8. 7. Figure 1: Percentage decline in poverty and manufacturing employment elasticity Source: R. Islam (ed.), 2006.

  9. 8.Regression analysis: Some tentative conclusions • Employment-intensity of growth has a significant effect on poverty reduction • Concentration of workers in agriculture causes poverty • A shift of workers to manufacturing reduces poverty • Education contributes to poverty reduction • Higher dependency burden increases poverty • An increase in inequality leads to an increase in poverty Source: R. Islam, (ed.), 2006.

  10. 9. Generating productive employment for pro-poor growth • Inter-related policy packages influencing: — the pattern of growth (equitable and with sustained labour demand) — efficient labour market outcomes • Pattern of growth — employment objective as central to economic and social policies — macroeconomic targets and policy packages: need for flexibility

  11. 10. Generating productive employment for pro-poor growth (cont’d) — productivity, earnings and wages — EIIP (including public works programmes); cooperatives — boosting productivity and employment in rural non-farm activities — promoting labour-intensive manufacturing; SMEs

  12. 11. Generating productive employment for pro-poor growth (cont’d) • Labour market outcome — factors influencing labour market outcomes (HRD; appropriate skills; HIV/AIDS) — what labour market policies are needed to facilitate economic reforms and growth (flexicurity)? — Articulation of active labour market policies – job creation – training and retraining – job facilitation

  13. The Employment Policy Framework - policy research; - country-level advisory and technical cooperation. Checklist of the key policy areas and sub-areas for national employment strategies. An inventory of the available tools in each policy area and sub-area. Guides/manuals. 12. ILO support to employment strategy formulation

  14. 13. Implementing the employment pillar of DWCPs 1. Employment dimensions of DWCPs - multi-component/integrated approaches (ILO-SIDA collaboration: Ethiopia; Madagascar. - issue-based activities (e.g. Lesotho; Indonesia). 2. Focus countries. 3. Employment and Decent Work in PRSPs - country-specific priorities - building partnerships (inter-ministerial coordination), Burkina Faso; Tanzania. 4. Work with constituents at the national level. 5. Monitoring and evaluation.

  15. 14. The integrated GEA approach to employment policy: Basic concepts, approaches and tools . BASIC CONCEPTS Determinants & Prerequisites KEY POLICY AREAS Checklist TOOLS Illustrative list of E- knowledge products: OBJECTIVES & OUTCOMES Values and Principles Full respect for Fundamental Workers’ Rights & International Labour Standards • Growth: • Capital-Investment • Human Capital • Productivity • Trade • Governance • Distribution-equity, • & social inclusion: • Taxes & transfers • Access to: • - Assets - credit • - Education and training • - Infrastructure • - Health • Social Protection • Empowerment, • Governance & • Institutions: • Representation • Participation-Power • Social Dialogue • 1. Economic Policies for • Employment Expansion (Demand Side) • - Macroeconomic Policies • - Financial policies • - Investment Climate/Policy • - Trade, RI, sectorial policies • - Labor Mobility/Migration • 2. Skills, Technology & • Employability • - Training policies and systems • - Skills for technological change • - Employment Services • - Improved access to training • Employment-centred growth strategies • Growth-Employment-Poverty reduction links • LM adjustment to Trade/Regional integration • Access of working poor to finance • E-Intensive Investment Approaches • Recognition of skills across borders Macroeconomic policies • Training, Lifelong learning, on the job-training. • Worker Displacement, career guidance, • Community-based rehabilitation • Use of ICTs for productivity • Achievement of • Key Objectives: • EMPLOYMENT • Poverty reduction • Gender • Young people • Target Groups: • Old, Disabled, others • Informal Economy. • Crisis response Decent Work Country Programmes –DWCPs- • Business Development Services (BDS) for SMEs • SME Finance • Entrepreneurship and Productivity Tools • Corporate Social Responsibility • Strengthening cooperatives • Capacity-building materials for LED 3. Enterprise Development: - Policy & regulatory framework - Value-chain Upgrading - Local Economic Dev-LED - Workplace practices 4. Labor Market: Institutions and Policies - LM adjustment policies - Passive and ALMPs - Employment Services - Industrial Relations 5. Governance, empowerment & organisational capital - Representation and advocacy - Freedom of Assoc/Coll bargaining - Social dialogue 6. Social Protection (Sector III) • Passive Policies: Income Support for Jobless • ALMP: training for jobless, job creation, • wage subsidies, enterprise creation • E-Services • Flexibility and Security • Capacity building with constituents • Coalition building for DW Projects • with Employers and Workers • Upgrading of informal enterprises & • communities Roadmaps for countries at different levels of dev. MAINSTREAMED STRATEGIES: A fair globalization Greater influence of International Labor Standards in Development Working out of poverty Expanding the influence of social partners, social dialogue and tripartism Advancing gender equality Country A Country B Country C

  16. 15. Selected references (websites) • Employment strategies for decent work country programmes: Concepts, approaches and tools for implementing the Global Employment Agenda “Vision” document on operationalizing the employment component of decent work country programme (GB-205/ESP/1/1) (http://www.ilo.org/public/english/standards/relm/gb/docs/gb295/pdf/esp-1-1.pdf) • GB papers Global Employment Agenda: 1. Trade, foreign investment and productive employment in developing countries (http://www.ilo.org/public/english/standards/relm/gb/docs/gb291/pdf/esp-2.pdf) 2. Promoting technological change for higher productivity job creation and improved living standards (http://www.ilo.org/public/english/standards/relm/gb/docs/gb292/pdf/esp-3.pdf) 3. Promoting sustainable development for sustainable livelihoods (http://www.ilo.org/public/english/standards/relm/gb/docs/gb294/pdf/esp-2.pdf) 4. Macroeconomic policies for growth and employment (http://www.ilo.org/public/english/standards/relm/gb/docs/gb291/pdf/esp-1.pdf) 5. Promoting decent work through entrepreneurship (http://www.ilo.org/public/english/standards/relm/gb/docs/gb289/pdf/esp-1.pdf) 6. Employability by improving knowledge and skills (http://www.ilo.org/public/english/standards/relm/gb/docs/gb295/pdf/esp-2.pdf) 7.Active labour market policies (http://www.ilo.org/public/english/standards/relm/gb/docs/gb288/pdf/esp-2.pdf) 8.Social protection and as a productive factor (http://www.ilo.org/public/english/standards/relm/gb/docs/gb294/pdf/esp-4.pdf) 9. Occupational safety and health: Synergies between security and productivity (http://www.ilo.org/public/english/standards/relm/gb/docs/gb295/pdf/esp-3.pdf) 10 Productive employment for poverty reduction and development (http://www.ilo.org/public/english/standards/relm/gb/docs/gb289/pdf/esp-2.pdf) • Employment Strategy Papers (http://www.ilo.org/public/english/employment/strat/publ/researchpap.htm#ep) • Discussion Paper series on issues in Employment and Poverty (http://www.ilo.org/public/english/employment/strat/publ/researchpap.htm#ep) PRSP papers (http://www.ilo.org/public/english/bureau/integration/departme/national/prsp/index.htm)

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