Working towards a different kind of employment

AROUND the world, persistent unemployment, skill mismatches, and retirement frameworks have become central to fiscal policy — and to the often fierce political debates that surround it.

The advanced countries are facing an immediate “ageing” problem, but most emerging economies are also in the midst of a demographic transition that will result in an age structure similar to that of the advanced economies — that is, an inverted pyramid — in just two or three decades.

Multiple problems affect employment. Globalisation results in a continuous shift of comparative advantage, creating serious adjustment problems as employment created in new activities does not necessarily compensate for the loss of jobs in old ones. In any case, most new jobs require different skills, implying that workers losing their jobs in dying industries have little hope of finding another one.