More jobs, greater choice

Spotlight on Employment
Business and Industry Advisory Committee (BIAC) to the OECD

Illustration by David Rooney

Governments, workers and business should stay focused on concrete goals. Only then will we succeed in creating more jobs.

The greatest stimulus to employment is economic growth, says Thomas R. Vant, secretary-general of the Business and Industry Advisory Committee (BIAC) to the OECD. Mr Vant argues that the OECD Jobs Strategy is a blueprint that should be applied more seriously.

Business people are a practical bunch, and generally love a challenge. Throw them a problem to solve or a goal to meet and, chances are, they will come back at you with 10 strategies for meeting and exceeding that goal. As long as the objective is clear and realistic, most business folk will forge on with this “can do” attitude.

And, when business and government team up working towards such a goal, results can be impressive. But asking business and governments to meet abstract aims that mean something different to each person you talk to, creates confusion and sets everyone up for failure.

This is why I, as the leader of a business organisation, am not fond of the very subjective concept of “good” jobs and “bad” jobs. Now, “more jobs” and “greater choice”: these are goals I can relate to. They can be met and surpassed if tackled in an effective way.

First, let’s look at the idea of “more jobs”. The greatest stimulus to employment is economic growth, which cannot happen without investment. Companies must operate within frameworks that encourage them to invest and expand. Here’s a “real world” example.

Several years ago, my former company, Syncrude Canada, a large oil producer, was deciding whether it would proceed with a multi-billion dollar project, and this during a period when product prices were low and construction costs were escalating. As so often in business, time became a deal breaker. We had to get conditions clear and ironed out quickly if the project was to go forward.

It was a tough dilemma. Several levels of government got together and formed one window for Syncrude management to talk to, and they stuck to their agreement. This involved timely approval of new residential development and all that goes with that sort of municipal investment, such as roads, bridges, hospitals and schools. The goal was to provide a safe and healthy environment to attract permanent employees and their families to this new opportunity.

It was a co-operative effort, made possible because different levels of government were willing to accommodate an innovative way of working with the industrial and business communities. In short, we pursued the same objectives in a transparent fashion and won.

Not only did the project come in on schedule, but also the company and the government kept their sides of the bargain. Most important, thousands “more jobs” were created and the economy of an entire region was revitalised.

Survey reveals usual barriers

Of course, all situations are not so clear-cut and there remain a variety of structural obstacles to job creation. BIAC recently surveyed its national member organisations, representing hundreds of thousands of companies in OECD countries, to find out what employers see today as the main barriers to expanding employment in their countries. The most frequent replies from a broad spectrum of members were: heavy burden of taxation and social security contributions; general over-regulation and lack of flexibility in the labour market; mismatch between available skills and company requirements; often insufficient incentives for people receiving income support to resume work; overly bureaucratic regulations for hiring temporary workers; too much paper and red tape for the creation of micro-businesses and SMEs; low activity rates of certain parts of the population.

Not surprisingly, these issues were all mentioned in the OECD’s excellent 1994 publication, OECD Jobs Study. Almost 10 years later, its recommendations remain pertinent, but unfortunately, have still gone unheeded by too many OECD governments. BIAC is a staunch supporter of the study’s conclusions, and sees the OECD work as a real blueprint for job creation.

So, why is the concept of “greater choice” important? The answer is flexibility. In an ever-changing marketplace, management needs room to manoeuvre to benefit from workers’ talents in different ways. Particularly in today’s complex global market, being able to react quickly is essential if a company hopes to remain competitive and thrive. Labour rigidity holds companies back, hurting business and jobs.

In addition, workers benefit from having greater choice. Options like part-time or flexible working hours, variations in work time, innovative leave arrangements and telecommuting can help workers better match their jobs to their own needs, such as reconciling work and family life when children are young, or setting a different work pattern for the disabled or older workers. Flexibility works for both employers and employees. However, business needs the backing of both government and employees to develop working conditions that meet both the market’s evolving challenges and individuals’ needs.

More jobs and greater choice are goals we can focus on, plan for, and attain.

©OECD Observer No 239, September 2003

Economic data

GDP growth: +0.6% Q1 2019 year-on-year
Consumer price inflation: 2.3% May 2019 annual
Trade: +0.4% exp, -1.2% imp, Q1 2019
Unemployment: 5.2% July 2019
Last update: 8 July 2019

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