| Click for the Finfacts Ireland Portal Homepage |

Finfacts Business News Centre

 Irish Economy
 EU Economy
 US Economy
 UK Economy
 Global Economy
 Asia Economy

Finfacts changes from 2015


How to use our RSS feed

Follow Finfacts on Twitter

Web Finfacts

See Search Box lower down this column for searches of Finfacts news pages. Where there may be the odd special character missing from an older page, it's a problem that developed when Interactive Tools upgraded to a new content management system.


Finfacts is Ireland's leading business information site and you are in its business news section.


Finfacts Homepage

Irish Share Prices

Euribor Daily Rates

Global Cost of Living

Irish Tax - Income/Corporate




Content Management by interactivetools.com.

News : Global Economy Last Updated: Mar 5, 2015 - 7:59 AM

Global labour market trends portend paradise for some but uncertainty for many workers
By Finfacts Team
Mar 5, 2015 - 1:55 AM

Email this article
 Printer friendly page

Today’s global labour market demands more specialized skills, but migration and technology are helping—not hurting—chances of high-quality employment, according to the March 2015 issue of Finance & Development (F&D) magazine.

30 million jobs, mostly in advanced economies, were lost during the Great Recession, writes the IMF’s Prakash Loungani in the latest issue of F&D. The world has since recovered slowly and unevenly, with global unemployment finally falling back to its pre-recession rate of 5 1/2%.

But the situation remains grim in much of Europe, especially for youth, says the IMF’s Angana Banerji. Most of the increase in youth unemployment stems from feeble economic growth, Banerji’s research finds, so the policy priority should be to boost demand. Indeed, the European Central bank is easing monetary policy and countries are investing in public infrastructure projects.

The story is different in sub-Saharan Africa, where economic growth has been strong and unemployment is relatively low. F&D’s Bruce Edwards writes that there the problem is “transforming the job market from one that has kept people working in small informal jobs and on farms—often for little or no pay—to one that offers more opportunities in the manufacturing and service sectors.”

With sub-Saharan Africa’s working-age population set to double by 2050, it’s urgent that businesses—whether formal or informal—provide many more jobs, and soon. Larger companies would have the advantage of providing tax revenue and social programs such as pensions and health care, but for now, any new jobs would be embraced, wherever they come from.

Moving out

Over 200 million people are unemployed worldwide. No surprise then that some fear immigrants and robots will take the jobs they so desperately need. But obstacles to immigration—geographic, linguistic, and bureaucratic—mean the share of migrants has remained stable since 1960 at about 3% of the global population. The limited globalization of the labour force means large wage gaps persist between countries that send migrants and those that receive them; migration has little impact on wages.

Migrants often get blamed for flooding the job market, but the World Bank’s Çağlar Özden writes that they rarely take jobs from natives. If anything, they tend to nudge local workers into higher-skilled and better-paying jobs—as managers for example. Low-skilled migrant workers offer household help that allows educated women to work while their children are young.

Immigration does create jobs, with migrants performing the jobs natives are either unwilling or unqualified to perform. But there are also losers in the process and those are the stories we hear more about. Those who are too old to learn new skills or at the bottom rung of the ladder will lose out to foreign workers.

The largest economic benefit of migration for a host country is lower prices for consumers.

Given the pluses of immigration, recipient countries are wise to encourage it, while enforcing the taxation of immigrants' income and charging administrative fees to employers for visas, Özden recommends. Then these revenues can pay for skills development of some natives and unemployment insurance for others who cannot be retrained.

No robot takeover

Nor can joblessness be blamed on technology, says James Bessen of Boston University. Sometimes new technologies eliminate jobs altogether, but his research finds that technology today creates demand for different capabilities, displacing workers to different jobs that require new skills.

Only in advanced economies’ manufacturing sectors are jobs being eliminated—and these losses are offset by new jobs in other sectors. For example, the introduction of automatic teller machines in the United States led to more branches being opened, resulting in no fewer teller jobs but more branch manager jobs. People skills and those that complement the new technology are more in demand than ever.

But new technology does lead to stagnant wages for ordinary workers and skills shortages for employers, heightening inequality.

Labour market trends

The ILO’s (International Labour Organisation) Ekkehard Ernst agrees. As workers move around the world and technology automates many activities, the benefits of globalization accrue disproportionately to the top and bottom of the income scale. And as middle-income jobs stagnate or are cut, especially in manufacturing, inequality worsens. Ernst predicts “there will be better working conditions and higher salaries, but probably only for those who possess the right skills.”

Another influence exacerbating inequality has been the decline in unionization in recent decades. Research by the IMF’s Florence Jaumotte and Carolina Osorio Buitron finds that this phenomenon, combined with reductions in minimum wages, has fed the rise in the share of income going to the top 10%.

Related Articles

© Copyright 2015 by Finfacts.ie

Top of Page

Global Economy
Latest Headlines
Strong Swiss franc gloom deepens for exporters
Global investors shift focus to China; EM outflows surge to $1tn in 13 months
Global oil glut will continue into 2016
Stable growth momentum in OECD area but slowing expected in China
Prices for major food commodities in July lowest since September 2009
Global manufacturing in July weakest level in two years
US, China and UK lead top 25 target countries for foreign direct investment
Budget surpluses rare in developed countries from 1980s; Italy, France, Greece had none in 60 and 40 years
Singapore, London and Shanghai top cities for new FDI projects in 2014; Dublin in 11th place
Exchange rates shuffle as Dublin ranked 49th most expensive city; Paris at 46; Berlin at 105
Western consumer groups under pressure in China and India
Developing countries facing “structural slowdown” likely to last for years
OECD BEPS Tax Project: Amazon books UK sales in UK; Australia proposes up to 100% in penalties
Emerging Markets Index falls to 12-month low in May as manufacturing contracts
US and world economies slowing in 2015 — OECD
Global manufacturing production rose slightly in May; Trade flows weak
GDP growth in OECD area slowed to 0.3% in the first quarter of 2015
Only one quarter of workers worldwide have stable employment contracts
Automatic Exchange of Tax Information: OECD says countries won't be able to game system
Gates Foundation loses in Swiss family's shares coup
Minimum wage levels in OECD countries
Brent oil benchmark over $68 a barrel - up almost 50% in 2015
Global growth slows and manufacturing dips to 21-month low
Family-controlled firms dominate European business
Top 10 of world’s 250 largest consumer products companies account for 30% of sales
Nine of world's 20 fastest growing economies in Africa
Globalisation maybe stalling as trade growth remains weak
Global growth prospects uneven across major economies says IMF
Emerging markets growth lowest since 2009; Global growth at 30-year average
China's economic rebalancing hitting Latin American economies
New York, London, HK & Singapore top global financial centres index; Dublin recovers
Global growth in modest expansion from low oil prices/ monetary easing says OECD
Composite leading indicators point to positive change in growth momentum in the Eurozone
Global labour market trends portend paradise for some but uncertainty for many workers
Vienna remains top of World Quality of Living Rankings in 2015; Dublin at 34
Zurich and Geneva overtake Singapore to become world's most expensive cities
HSBC Switzerland and Falciani: How it happened
Global economic power to continue shift from advanced economies
Global food price index falls in January; Cereal output set for record
Global debt has risen $57tn or 17% of world GDP since 2007