A more inclusive labour market

OECD Observer

Why should countries care about underemployed groups such as the unskilled, lone parents, women, immigrants and older workers?

A harsh question, perhaps, but it is one of the key issues which will be examined by OECD Employment and Labour Ministers at their meeting of 29-30 September, under the title “Towards more and better jobs”.

Many people in these disaffected groups are trapped in situations of inactivity. They are disproportionately affected in periods of economic weakness like the current one. And if they manage to re-enter the labour market, they have difficulty moving up the career ladder.

These concerns are not new. Yet, there is a renewed interest in these issues because of a recognition that better mobilisation of such underutilised resources is crucial to meeting the challenges of ageing. Pension reform is an obvious response to ageing, but it is not enough: unless under-employed groups are better mobilised, population ageing will entail labour shortages, hurt growth and increase public welfare bills.

Ministerial discussions will focus on what works and what doesn’t in a bid to utilise more labour resources. A comprehensive policy strategy will be considered. This involves, first, greater emphasis on employment-conditional benefits and targeted reductions in social security contributions. Moreover, access into paid employment of under-employed groups should be facilitated, e.g. through wider part-time opportunities and more child care facilities. Individuals on social benefits who can work should be “activated” with the help of effective support services, with penalties for those that refuse.

Mobilising older workers demands not only reforming early retirement schemes and disability benefits, but taking action to change social attitudes towards older workers. Also, it demands better investment in training, especially in new technology. This is the best way to enhance the employment prospects of unskilled workers and upgrade abilities in general.

Some have argued that maintaining some individuals in inactivity can help reduce unemployment and improve employment prospects for the young. Experience shows that such approaches have been counter-productive, hurting employment generally. A more inclusive labour market is possible, and the upcoming labour ministerial aims to provide a stepping stone to reach this goal.

©OECD Observer No 237, May 2003

Economic data

GDP growth: +0.6% Q2 2018 year-on-year
Consumer price inflation: 2.9% Sept 2018 annual
Trade: +2.7% exp, +3.0% imp, Q4 2017
Unemployment: 5.2% Sept 2018
Last update: 13 Nov 2018


Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive paper editions delivered to you directly

Online edition
Previous editions

Don't miss

  • Globalisation will continue and get stronger, and how to harness it is the great challenge, says OECD Secretary-General Gurría on Bloomberg TV. Watch the interview here.
  • OECD Secretary-General Angel Gurría with UN Secretary-General António Guterres at the 73rd Session of the UN General Assembly, in New York City.
  • The new OECD Observer Crossword, with Myles Mellor. Try it online!
  • Watch the webcast of the final press conference of the OECD annual ministerial meeting 2018.
  • Listen to the "Robots are coming for our jobs" episode of The Guardian's "Chips with Everything podcast", in which The Guardian’s economics editor, Larry Elliott, and Jeremy Wyatt, a professor of robotics and artificial intelligence at the University of Birmingham, and Jordan Erica Webber, freelance journalist, discuss the findings of the new OECD report "Automation, skills use and training". Listen here.
  • Do we really know the difference between right and wrong? Alison Taylor of BSR and Susan Hawley of Corruption Watch tell us why it matters to play by the rules. Watch the recording of our Facebook live interview here.
  • Has public decision-making been hijacked by a privileged few? Watch the recording of our Facebook live interview with Stav Shaffir, MK (Zionist Union) Chair of the Knesset Committee on Transparency here.
  • Can a nudge help us make more ethical decisions? Watch the recording of our Facebook live interview with Saugatto Datta, managing director at ideas42 here.
  • The fight against tax evasion is gaining further momentum as Barbados, Côte d’Ivoire, Jamaica, Malaysia, Panama and Tunisia signed the BEPS Multilateral Convention on 24 January, bringing the total number of signatories to 78. The Convention strengthens existing tax treaties and reduces opportunities for tax avoidance by multinational enterprises.
  • Rousseau
  • Do you trust your government? The OECD’s How's life 2017 report finds that only 38% of people in OECD countries trust their government. How can we improve our old "Social contract?" Read more.
  • Globalisation’s many benefits have been unequally shared, and public policy has struggled to keep up with a rapidly-shifting world. The OECD is working alongside governments and international organisations to help improve and harness the gains while tackling the root causes of inequality, and ensuring a level playing field globally. Please watch.
  • Checking out the job situation with the OECD scoreboard of labour market performances: do you want to know how your country compares with neighbours and competitors on income levels or employment?
  • Trade is an important point of focus in today’s international economy. This video presents facts and statistics from OECD’s most recent publications on this topic.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .
  • Visit the OECD Gender Data Portal. Selected indicators shedding light on gender inequalities in education, employment and entrepreneurship.

Most Popular Articles

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2018