This article is part of a series in which OECD experts and thought leaders — from around the world and all parts of society — address the COVID-19 crisis, discussing and developing solutions now and for the future.
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COVID-19 is profoundly reshaping the world of work. Recognising the opportunity to change course—and delivering its potential—is one of the toughest tests yet for policy makers.
The investor Warren Buffett famously quipped that it is only when the tide goes out that you learn who’s been swimming naked. It is now well over a year after the COVID-19 pandemic first hit, with the effects of the exceptional measures taken to mitigate the impact of the Crisis on jobs and livelihoods forcibly dissipating. Those left exposed by the fallout of a Crisis that has hit the labour market especially hard include 14 million people inactive and 8 million people unemployed in OECD countries alone. The imposition of strict lockdowns to contain the pandemic wiped out 10 years of gains in terms of unemployment.
Consequently, the focus of our most recent event in the OECD Forum Series 2021, “Empowering workers, delivering a jobs-rich recovery” was on what policy makers and other key societal actors must do now.
Opening proceedings, OECD Secretary-General Mathias Cormann observed that “economic and labour market recovery will remain precarious while vaccination rates remain uneven, not least because of new COVID-19 variants of concern. We need more jabs for more jobs. It will be very important to get policy settings right to encourage business investment and job creation, as well as to drive the necessary upskilling, reskilling and skills matching required to ensure everyone has the best possible opportunity to participate and benefit from the recovery”. Further he stressed how “essential” it was “to continue supporting families most in need while better targeting fiscal policy measures designed to boost growth towards firms and jobs that have a viable future in the new post-COVID environment, by providing the right incentives for business investment leading to the restoration and creation of more new jobs”.
“Empowering all workers morning, noon and night”
Delivering the keynote at the event, and taking the United States as an example, the recently appointed US Secretary of Labor Martin J. Walsh, underlined the importance of “investing in the right kind of infrastructure” as “the single most important thing the US Government must do to help American workers”.
As the COVID-19 pandemic took hold, United States unemployment had spiked to 17%, the highest rate in its history and 22 million jobs were lost. What differentiated this wave of joblessness from previous crises was the type of jobs lost, in particular, service jobs requiring face-to-face interaction. This hit two groups especially badly: ethnic minorities and women. The United States jobs recovery has been quicker than other member countries, but the number of jobs lost still stands at 6.8 million compared to pre-pandemic levels. Moreover, women’s participation in the recovery is at a slower pace, while unemployment is 75% higher for African Americans.
“When workers are vulnerable, the economy is vulnerable”, said Secretary Walsh. “What people need is far beyond a job; we need to remove the barriers that hold people back”, he continued, pointing to the multiple challenges of housing, childcare, healthcare, education, training, an adequate safety net and social protection. Nurturing inclusion and equity will allow the country to build a stronger and more resilient economy.
A once-in-a-lifetime opportunity to build a better world of work
Stefano Scarpetta, Director of Employment, Labour and Social Affairs at the OECD presented key findings from the recent OECD Employment Outlook: across OECD countries, around 22 million jobs were lost in 2020 compared to 2019 and 114 million around the world. Levels of employment in OECD countries will still be below pre-pandemic levels by the end of 2022.
The pandemic has particularly affected those most vulnerable in labour markets—including those in low-paying or temporary jobs, the low-skilled, women and young people. Public support has been broadly successful in protecting livelihoods, but labour market attachment among these groups has fallen.
The collective mobilisation for the recovery presents opportunities and continuing challenges: substantial investments in active labour market policies continue to be needed; we will need a massive effort to train and re-train workers; and there is an urgent need to improve social safety nets and better target social programmes.
To learn from real-world actors and delve further into the challenge of delivering a jobs-rich recovery, we then engaged the key voices from the OECD Forum Community from the business, labour and youth sectors in a vibrant discussion and debate. The following are the issues raised:
The apathy of youth
“We are at a precipice”, said Manpreet Deol, representing OECD Youthwise, an advisory group of people aged 18 to 30 years old. She conveyed that young people feel that intergenerational inequalities can lead to apathy because their views—when heard—are too often tokenised. While acknowledging the relative privilege of having earned a degree in STEM, she pointed to the anxieties many young people have felt entering the workforce as the pandemic hit.
She shared her peers’ expectations of government and key societal actors to join forces to support workers in the context of the gig economy, notably through minimum wages and better employee benefits. Youthwise members also stressed the importance of better taking into account the inextricable link between climate change and the recovery from COVID, including in the world of work, as well as the need to make sure that the great digital acceleration we have experienced in recent months does not translate into growing inequalities and delivers better opportunities for all.
Reconsidering skills, career paths and the value of work
Beyond the challenges for those at the beginning of their careers, “a wholesale rethinking and repurposing of the world of work” was called for, according to Jacques van den Broek, CEO of Randstad, the largest global provider of human resources services. Pointing to the importance of developing soft skills, he argued for a “reframing of the world of learning: formal education is overrated and needs to reinvent itself to stay relevant in the job market”. Companies must recognise that there is no such thing as an ideal candidate. What he envisaged is a “talent market”: whereas now candidates send CVs to companies, in the future it will be the other way around.
But it’s not just about giving people the right skills to enter a rapidly changing world of work. Reskilling and lifelong learning are paramount, and they must also be accompanied by greater support and willingness to reorient careers. Referring to a recent Randstad survey, Mr. van den Broek revealed that 75% of people felt the government and their employers were responsible for providing them with career opportunities and for their longer-term well-being, rather than themselves as individuals. At the same time, only 7% of respondents who lost their jobs during the pandemic felt inclined to take advantage of training opportunities. “We need to take people by the hand as moving job in middle age is scary”, he said, helping them acquire the skills that will allow a transition into sectors that are more secure.
While he felt there is cause for optimism, he drew an important distinction between jobs most at risk—white collar, mid- to high-level jobs likely to get automated—and those where we might face shortages—blue-collar jobs in the services sector. “Blue-collar workers were not properly taken care of during the pandemic, and they need more protection in terms of salary and social protection”.
One actor that has started to reframe hiring practices and skills recognition is the global technology company IBM. Through its SkillsBuild programme, IBM focuses on tapping into the latent abilities of more marginalised populations, including, in the United States, African Americans, veterans and refugees, explained Justina Nixon, IBM’s Vice-President and Global Head of Corporate Social Responsibility. “Fifty percent of new hires at IBM do not have a college degree. Interestingly, when eliminating college degree requirements, IBM has experienced more diversity in their applicants. Removing that barrier has opened doors to those usually left out in the past”.
She offered some best practices developed over the years at IBM to unlock real-world opportunities: establishing partnerships with non-profits that are closer to the groups ultimately served; connecting skills and training programmes to real work opportunities; and making sure that platforms provide proper user experience for workers to assess training that translates into jobs.
Closing the gaps
While we think about the long-term structural challenges of the labour market, we should not forget that one of the clearest demarcations that has emerged during the pandemic has been between higher-paid professionals and essential workers. Often having to endure low-pay and insecure contracts, these essential workers include delivery drivers and people working in supermarkets whom many have come to rely on as the pandemic has progressed—yet there is little evidence their working conditions will improve.
The most visible of these essential workers are those in healthcare. At a human level, it is important to acknowledge they are exhausted, fearing potential new waves of infections, the effects of “long” COVID, backlogs of patients with postponed treatments and parallel mental health epidemics. Some are even questioning their career in the health workforce. There is an urgent need to translate applause into tangible and material policy action that improves their lives and livelihoods. This is at the heart of a new OECD project, Beyond Applause, which seeks to ensure that care workers are given the respect and rewards they deserve. This is an essential issue, which has germinated from and been inspired by several OECD Forum conversations and events since the onset of the COVID Crisis in March 2020.
“It is a new class divide”, argued Frances O’Grady, General Secretary of the TUC, the British federation of trade unions. “Flexibility must be reframed as ‘positive flexibility’ so that it can work for everyone, while we must be more open to new ways to organise work”, she continued, pointing to job sharing, four-day weeks and term-time jobs that allow for greater flexibility for different types of workers, in particular those with children. Parents—and especially mothers who bear a disproportionate burden of childcare and unpaid work—need additional support to balance their careers and family life, with some women “feeling as though the clock had been turned back to the 1950s, with increased responsibilities for children and in the home”. There are further challenges for groups already vulnerable before the pandemic: women from migrant backgrounds are twice as likely to be on zero-hour contracts than white men. Ms. O'Grady stressed that “we must humanise work and make it more inclusive”.
A better future for everyone
The pandemic has the potential to be a turning point, a point where we recognise—and take—collective responsibility for each other. Trust will be a key driver for this. Many have been wondering whether the extraordinary support we have witnessed recently is just one-off benefits for extraordinary times.
As we saw during this conversation, partnerships between government, business and labour are much needed, and can deliver effective change. The jobs recovery will lag the wider economic recovery and, as we have seen, securing a job is not just about income: it’s also about access to healthcare, childcare, education, housing and pensions, and wider opportunity throughout life.
While the Crisis has profoundly disrupted lives and livelihoods, it presents an opportunity to deliver a jobs-rich, fairer, greener and more connected future. These are some of the fundamental dimensions that we will continue to explore in upcoming Forum virtual events, delving into issues such as the potential of digital transformation in the recovery, new approaches to education and skills, and the need to revisit healthcare beyond COVID.
I look forward to continuing this exchange of ideas and best practices with you.
|Future of Education & Skills
|Future of Work
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