Wednesday, 11 September 2013

G20 Leaders need Labour as True Social Partners

Last weekend the G20 Summit was held in St. Petersburg, Russia. The two-day summit brought together leaders of developed and emerging economies, who together account for roughly 90% of the world economy. While the news from the G20 was better than it has been in recent years and there was broad agreement that the world economic situation is improving, leaders cautioned that emerging economies are showing signs of weakness.

The BRIC nations (i.e. Brazil, Russia, India and China) have long been recognized as the emerging economies to watch, with rapidly advancing economies and increasing political clout on the world stage. But even among the BRIC nations, the last two years have not been kind. Unemployment and stagnant or falling incomes affect greater than half of the workers in these countries[1].

Leaders from the G20 have generally responded to the economic turmoil with austerity measures aimed at cutting costs. Sadly, this strategy also often means cutting jobs and benefits for workers. Given that employment is a vital ingredient to social and economic progress, when the G20 leaders note the economic situation is improving, one has to ask: for whom is it improving? It’s certainly not improving for the legions of unemployed. Nor is it improving for the roughly 1 in 8 people who can’t afford for basic living expenses.

Understandably enough, people around the world are losing hope in a better future for their children. An ITUC Global Poll reveals that a whopping 80% of people believe their government has not adequately tried to deal with the unemployment problem. With the bank bailouts and corporate tax breaks dominating the minds and actions of government, there’s a broad sense that ordinary workers have been thrown under the bus, so to speak.

Nowhere is this more apparent than in the situation of today’s youth. With youth unemployment reaching record highs in nations across the globe it’s not hard to see why hope is fading. The situation is quite dire. In Greece, for example, youth unemployment currently stands at a dismal 65%[2]. In Canada the situation isn’t as bad, but youth unemployment is roughly twice the national average at 14.1%. And even 14.1% might be a generous reading; many believe the real unemployment rate among youths is 19.1%[3]. Those who work are often underemployed – filling part-time jobs that do little to help youths plan for the future.

The cost of youth unemployment is great. Unemployed or underemployed youths cannot buy houses, cars or adequately plan to start families. All of these things would stimulate the economy and contribute to a thriving society. The result is that a generation is being created in which young people are demoralized and regard their own futures with fear rather than excitement is being created.

So what can be done? John Evans, General Secretary of the Trade Union Advisory Committee to the OECD asserts that the G20 needs to provide a “…jobs action plan that sets national employment targets and raises sustainable aggregate demand and reduces income inequality...”[4]

Simple austerity measures and a general tightening of the collective belt are unlikely to be enough to accomplish the change that’s needed to help today’s youth. Governments may need to provide subsidies to stimulate youth employment. Stefano Scarpetta, Director, Employment Labour and Social Affairs with the OECD states: “We are pushing for bold action to stimulate job creation for young people, even unorthodox measures that you don’t necessarily consider in normal times, like some subsidies for hiring at companies.”[5]

Unions must play a major role in any plan to stimulate jobs. Governments may need to provide subsidies in order to ensure that youth can get a toehold in the economic sphere, but the unions are needed to provide stability and valuable rights and benefits for the jobs created by the subsidies. The subsidies will mean little if it allows corporations to create a host of minimum-wage jobs that offer no benefits or meaningful protections for workers’ rights.

Without union involvement, workers could be forced to toil for low-wages, never getting ahead and never being able to dream of a better future until one day the company finds a justification for cuts. This is the only way a jobs action plan could ensure that the spectre of income inequality is sufficiently tackled and any jobs created would not only offer long-term sustainability but protections for the human rights of all workers. Governments need to embrace organized labour as true social partners, planning together to battle unemployment and restore the dignity and respect that so many workers have had stripped or denied them by these harsh economic times.

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