OECD Labour and Social Affairs Ministers discuss measures to combat unemployment

Meeting in Paris on 14-15 October 1997, OECD Ministers of Labour and Social Affairs highlighted the importance of the institution of effective active labour market policies, policies specifically targeted at low-paid workers and less-skilled and long-term unemployed people, as well as policies to encourage life-long learning.

Ministers of Labour and Social Affairs from the 29 Organisation for Economic Cooperation and Development (OECD) countries met in Paris on 14-15 October 1997 to discuss the implementation and monitoring of the OECD's Jobs Strategy put forward in 1994. The meeting came in the run-up to the EU special Jobs Summit held on 20-21 November 1997 and the G8 Conferences in Kobe and London in February 1998, at which the crisis of unemployment and the maintenance of global competitiveness will also be at the top of the agenda.

The OECD Jobs Strategy has since been followed up with thematic and country specific work and Ministers took stock of achievements over recent years. It was noted that those countries which had moved ahead in implementing the strategy had already begun to reap the benefits in the form of markedly improved employment performance in recent years. While ministers reported a growing consensus among parliamentary parties and the social partners on the steps which need to be taken to reduce unemployment, many countries shied away from implementing the recommendations of the Jobs Strategy in full, particularly those calling for greater labour and product market flexibility, fearing that such steps might threaten social cohesion by leading to growing earnings inequality and poverty.

In order to avoid such adverse effects, Ministers agreed the following to be among the most promising avenues of action in the area of labour market policy:

  • the improvement of work and training incentives for low-paid workers and employment opportunities for less-skilled job-seekers;
  • the enhancement of the effectiveness of active labour market policies to prevent the jobless from drifting into long-term unemployment and social exclusion; and
  • maintaining and upgrading employability for all through effective strategies for lifelong learning.

Recent employment data show a growing gap between the labour market experiences of high- and low-skilled workers. Ministers therefore considered the reduction of this gap to be a priority. It was suggested that unemployment among the low-skilled must be reduced by improving their employability, assisting in their job search and reducing the cost of employing them. Recognising the problem of low-skilled workers becoming trapped in low-paid work as a social and economic problem in its own right, OECD Labour and Social Affairs Ministers underlined the importance of life-long learning to improve the longer-term prospects of these individuals.

The activation of passive labour market policy has been a priority in the OECD as well as the European Union for several years and the meeting pointed to recent evaluation studies which showed the timing and method of such activation policies to be crucial. Experience from a number of OECD countries showed the following factors to be significant:

  • early activation and assistance with job search through job clubs and individual action plans;
  • the functional integration of the functions of public employment services' (PES) - ie access to active labour market programmes such as training, unemployment benefit administration and job referral - and the greater decentralisation of these services; and
  • the increased canvassing of employers by the PES and greater cooperation and/or competition of the PES with private sector employment services

Finally, Ministers recommended the improvement of policies aimed at strengthening incentives for individuals and employers to invest in lifelong learning; improving the identification of individuals in need of improved access to lifelong learning and to improve mechanisms for the accreditation of prior learning. They also pledged cooperation in the exchange of experience and the development of appropriate mechanisms to enable such cooperation.

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