Texte en français




Paris 14-15 October 1997



Introduction and Overview

1. The OECD meeting of Labour and Social Affairs Ministers was the first of a series of high level meetings on jobs to be held over the coming months which includes the Luxembourg European Summit and Kobe G8 Jobs Conference in November 1997 and another G7/G8 Employment Conference to be held in London in February 1998 under the chairmanship of the UK government. The outcome of this OECD meeting of Labour Ministers therefore may be significant in setting the tone of the debate at the forthcoming meetings.

2. The meeting was chaired by Mr. Ad Melkert, Minister of Social Affairs and Employment of the Netherlands. The agenda covered:- policies for low-paid workers and less skilled job-seekers; enhancing the effectiveness of active labour market policies: a streamlined public employment service; and lifelong learning to maintain employability. An informal debate also took place over the policy implications for governments of changes in workplace oganisation. The issue of globalisation was also touched on.

3. The Communique, final press conference, plus the tone of the speeches made at what was the first meeting of Labour Ministers in five years, represent an evolution in the application of the OECD Jobs Study. Now, low pay is "an economic and social problem in itself", and together with persistent unemployment they represent "threats to the social fabric". The Communique referred to the variety of policies being put in place to help the low-paid and less skilled job-seekers that point away from the old agenda of labour market deregulation. At the concluding press conference, Mr. Melkert went further by noting the "remarkable consensus among Ministers", on the need for policies that "stimulate people to accept change without fear", and the positive role that minimum wages play in providing decent wages for workers and their families, further noting that such a consensus was not possible five years ago. Furthermore, Donald Johnston used the Ministerial meeting to announce a major OECD project into youth unemployment, that may culminate in a summit meeting in late 1998.

4. As to the future of Public Employment Services, reform rather than revolution was seen as the answer. Australia's attempt to get Ministers to endorse their contestable market system for all reemployment services was defeated. On lifelong learning, the role of trade unions was recognised by Ministers when they, "saw an urgent need for concerted action, in co-operation with their colleagues ... and the social partners" in designing and implementing policies in this key area. At the final press conference it was announced that the OECD would consult TUAC and BIAC on this.

5. Disappointingly Ministers did not discuss the proposal in the TUAC statement to Ministers, and reinforced during the consultations, for a sustainable growth initiative to underpin labour market change. A mixed message was given as regards globalisation. On the one hand, Ministers merely "reaffirmed their commitment to observe internationally recognised labour standards and looked forward to the outcome of work on this currently underway at the International Labour Organisation" without announcing new initiatives. One the other hand, "Ministers called on the representatives of workers and employers to play an active role in finding economically viable and socially acceptable solutions to the challenges of globalisation." An early test of OECD governments' commitment to core labour standards will be whether they agree to a binding clause guaranteeing labour standards in the Multilateral Agreement on Investment, currently under negotiation.

6. The messages contained in the Communique must spread across the work of the OECD, especially as regards the next phase of the Jobs Strategy. The focus must now shift towards the positive elements contained in the original Jobs Study, notably during the country surveillance process. Indeed, the Chair of the meeting called for a "fine tuning" of the Jobs Strategy "where knowledge on best policies is still insufficient and, consequently, there is room for alternative policy choices." TUAC will seek to ensure that trade unions have a voice in the OECD's follow-up work to the Ministerial meeting, especially that on youth unemployment and lifelong learning.

Policies For Low-Paid Workers and Less Skilled Job-seekers (§§ 8-11)

7. TUAC has criticized in the past the follow-up to the OECD Jobs Study for arguing that the unemployed had to be "priced" back into work and for presenting a "one size fits all" model for countries. This negative perspective must now change. The Communique makes it clear that unemployment and low pay are both a threat to the social fabric, and for the unemployed, "getting them back into work would only be a partial and temporary response" and that workers "get trapped in low-paid jobs or revolve between a low-paid job and no job". The OECD Secretary-General said at the meeting: "There is an urgent need for Governments to design and implement effective adjustment policies which bring people with them." The Chair of the meeting warned the meeting against efforts to deregulate "labour relations in ways which are not compatible with conditioning labour skills, productivity and motivation in an evenhanded way". Governments should "not be ideological on the question of labour market regulation. At times it may be more strategic to replace the option of deregulation by decent regulation, in order to build a bridge between flexibility and security."

8. In the place of the "one size fits all" strategy, Ministers agreed "that only a broad-based strategy, comprising macro and micro-economic policies, and tailored to the specific circumstances of each country" would significantly improve the performance of labour markets. Within this, a twin track approach for the low skilled was endorsed, whereby once in employment, workers should be motivated and have the opportunity to climb the career ladder. Incentive structures should be put in place that encourage employers to recruit and train the less skilled, and which help workers to accept jobs, and to invest in their career development. The Communique also states that "a particular responsibility falls on the social partners in setting wage structures which favour the upward mobility of low-paid workers". In the longer term lifelong learning strategies would help the low-skilled.

9. Ministers discussed a number of different approaches adopted by Member countries to achieve these objectives, including, subsidies to employers to hire and train low-wage workers, public sector job creation and training schemes, and reductions/exonerations in payroll taxes for the low-paid coupled with wage floors. On the matter of minimum wages the Chair of the meeting in the final press conference stated that they were needed to raise the net income of workers to stop the rise in the numbers of working poor, and that policy makers were no longer scared by the job destruction arguments made against them. Ministers accepted that there was insufficient evidence as to which policy mix would achieve the overall objectives and called on the OECD to do further work in this area.

Active Labour Market Policies (§§12-16)

10. The second theme in the Ministerial discussion must be regarded in the context of contracted public expenditure which has hit active measures in labour market policies in many OECD countries. The discussion of the theme by itself is therefore an attempt by Ministers to re-vitalise and re-gain momentum in support of a longstanding policy instrument which lost the support of the Finance Ministries and Treasuries in the period since the last OECD Labour Ministerial in January 1992. While spending on labour market programmes is not expected to rise significantly in the near future, Labour Ministers' emphasis was clearly put on enhancing the effectiveness of active policies.

11. A key to prevent the unemployed drifting into long-term unemployment and social exclusion is seen in improving the job-search assistance function of Public Employment Services (PES). The communique recommends a closer integration of the functional delivery of active and passive (income support) labour market policies in those countries where agencies are institutionally separated. Ministers stressed the importance of early intervention in job-search assistance.

12. Private sector job placement services were not regarded as an alternative to Public Employment Services. At best they constitute an additional element aimed at exposing the PES to competition in some of its functions. On the contrary, Ministers regarded the effective provision of placement and related services as an essential element of a nation's infrastructure. The "action point" in this section of the communique is therefore a call by Ministers on the OECD to continue the ongoing work of reviewing member countries' Public Employment Services with a view to holding a conference in the future which will draw further conclusions for policy.

Lifelong Learning To Maintain Employability (§§17-20)

13. During the TUAC consultations, a key message given by the trade union side to Ministers was that Lifelong Learning, while supported by everybody, was in many instances an "empty box" unless concrete action is identified. Ministers have now moved towards filling that box, by building on the partnership approach designated as the way forward by the January 1996 meeting of Education Ministers. Ministers called for "concerted action" in co-operation with their colleagues in Education and Finance Ministries plus other public authorities, and importantly, the social partners.

14. Making the link between lifelong learning initiatives in schools, wider labour market programmes and within enterprises, Ministers recommended closer collaboration be established between the OECD's Employment, Labour and Social Affairs Committee and the Education Committee on matters of mutual interest in the field of lifelong learning. It was also recommended that Ministers from these two government departments meet together on these issues. This welcome step forward was called for in the TUAC statement to Ministers.

15. Specific areas where concerted action with the social partners and others was called for in the area of lifelong learning included: investment and finance related issues; improving mechanisms for the early identification of individuals requiring access to lifelong learning, including the development of different criteria to identify those more at risk from drifting into long-term unemployment and social exclusion; the establishment of, or adaptation of existing mechanisms, e.g., individualised development plans to facilitate ease of movement between lifelong learning opportunities linked to labour market interventions and those such as adult education that are linked to non-labour market services; to establish broader criteria for the assessment and recognition of skills; and the development of information channels to assist the assessment by individuals of the quality, costs and effectiveness of different learning opportunities.


16. It is significant that the communique contains a section on the effects of globalisation on employment as this was not part of the formal agenda of Ministers. Ministers recognised the "significant adjustments in terms of the structure of production and employment" and warned against the "real risk of a popular backlash against globalisation" in the "current situation of high and persistent unemployment ... and widening wage and income inequalities". The strategy that they have adopted on paper is also in accordance with TUAC's views: "assisting workers to move into high-productivity, high-wage jobs" as a response to globalisation for that "workers worldwide be in a position to benefit from its opportunities".

17. "Ministers reaffirmed their commitment to observe internationally recognised labour standards" and in this context gave explicit support to ongoing work in the ILO. But no new initiatives have been taken. Wider-ranging demands by the U.S. Administration and a few other governments to follow up the OECD's mandate to work on trade, investment and labour standards given by Finance Ministers at the May 1997 Ministerial Council, did not find sufficient support. Governments must now implement their commitments in practice in the OECD negotiations on the Multilateral Agreement on Investment (MAI), the debate inside the World Trade Organisation as well as in the International Labour Organisation itself. Labour Ministers at least ascribe the social partners a role "in finding economically viable and socially acceptable solutions to the challenges of globalisation".

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