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CONFERENCE KOBE, JAPAN 28-29 November, 1997


1. Few Ministers attended the Kobe Jobs Conference and it received very little media attention. It suffered from the spate of other employment meetings and summits and an unfocused agenda which covered both structural change and lifecycle developments - youth, prime-age workers and older workers. It was also overshadowed by the run up to the Kyoto Climate Change Conference which was to focus on the highly charged issue of targets for CO² emission reductions, and which began 48 hours after the Kobe Conference closed.

2. It was significant, however, that for the first time trade union and employers' representatives were invited to make presentations to the full conference. As indicated in the report of these consultations prepared by the TUAC, most of the national representatives found this positive. Several elements of the Chair's conclusions refer to the role of the social partners, core labour standards, social cohesion and employment security. These were introduced as a result of the remarks made by the trade union representatives.

3. At the trade union preparatory meeting hosted by RENGO, on 4-5 November, it had been agreed to focus on four priorities in the written trade union statement:-

- the need to emphasize the role of trade unions; - the focus on the quality of job creation and a shift away from negative labour market flexibility; - the need for the enforcement of core labour standards; and, - the need to reinforce growth, particularly in the light of the Asian financial crisis.

4. As indicated, trade union and employer representatives made inputs under the auspices of the ICFTU and IOE, whose contributions are noted in the conclusions. The Conference "stressed the importance of further promoting a dialogue between government, labour and management, as indispensable partners for productive activities in a market economy, in order to meet the policy challenges in each country" (§ 6). The need for "labour and management to share the fruits of economic activity" (§ 6) is also stressed as is the role of the social partners with regard to "modernisation" (§ 11) and wage determination (§ 14). The role of stakeholders is referred to with regard to youth employment (§ 18) and the need for collective agreements to cover educational leave and lifelong learning (§ 21). TUAC will be seeking to ensure that the practice of social partner presence is maintained at the next Jobs Conference in February in London and that there is involvement in the implementation of the national action plans which were published alongside the Chair's conclusions.

5. With regard to the debate over the quality of job creation and a shift of the reform of labour markets away from crude labour market flexibility, again some progress was made. As a result of the trade union presentation, an objective was added to those set out on "reconciling economic efficiency and social cohesion, so that increased flexibility is consistent with employment security and job quality" (§ 7 d). The focus of the conclusions was on "employability" of workers through skills acquisition, active labour market policies and lifelong learning (§ 13, 20, 21). This will be now picked up in the London Conference themes. The tone of these sections contrasts with some of the calls around the Denver Summit for the deregulation of European labour markets.

6. Only passing reference was made in the conclusions to globalisation and core labour standards. The Ministers reaffirmed their "commitment to observe internationally recognised core labour standards and looked forward to the outcome of work on this currently underway at the ILO". Although the conclusions made passing reference to the importance of macroeconomic policy, there was no reference to the mounting financial crisis in Asia, despite the circumstances under which it was taking place and the potential employment consequences.

7. With regard to structural change, the non labour market sections of the conclusions seem to reflect very much the tone of the debate in the host country Japan. There is a heavy focus on the need for deregulation, the encouragement of small and medium-sized enterprises and the encouragement of workers to become self-employed. This sounds like a hark back to the 1980's debate in other OECD countries.

8. Little new is said on youth unemployment, other than noting the OECD initiative. On the issue of older workers, there is for the first time a beginning of the discussion of the impact of the ageing of the workforce. There is a clear shift towards favouring continued employment of older workers. Some consequences are drawn in terms of improving working conditions for older workers.

9. In addition to the conclusions a set of voluntary national policy guidelines were agreed and a set of areas for future cooperation. A link was also made to the next Jobs Conference in London on "Growth, Employability and Inclusion". As noted TUAC will seek to ensure continued trade union participation and the reinforcement of the need to find a "third way" in labour market reform, avoiding either high unemployment or working poverty.



THE KOBE G8 JOBS CONFERENCE 28 - 29 November, 1997 Statement By Bill Jordan ICFTU General Secretary

This is the first time that trade unions and employers have been invited to participate in a G7/8 Employment Summit. The involvement of all the social partners is an historic development. It is a measure taken to match the seriousness of the OECD's unemployment problem. Our host Mr. Bunmei Ibuki in taking this initiative reveals his own determination to get to grips with unemployment, which is the very visible fault line running through the OECD's plan for prosperity. For our part we welcome the opportunity of making a contribution to tackling the social cancer that may prove to be the next century's greatest challenge. The trade union movement comes here, not with simple solutions. There are none! But we do come with a depth and breadth of experience, accumulated in our constant search for secure well paid employment, that you can put to use. While the trend of OECD structural employment seems to have only one direction, the debate on seeking its solution has fully broadened, as shown by both the OECD Ministerial Meetings in October and the Luxembourg Summit of the European Union. The argument is a sterile one between the so-called Anglo-Saxon model on the one hand and the continental European and Japanese systems on the other. Where one side seems to think statistical success is enough, even if it means recruiting a permanent standing army of the working poor, while the other side resists necessary change thinking it the best way to protect the endangered species we call the well-paid full time secure job. There is a growing recognition that such jobs together with the working poor and the outright unemployed are all points on a spectrum. That it makes more sense to adopt policies that deal with the quality of jobs and the creation of jobs together. Individual national policies no matter how appropriate will not nurture and grow jobs unless there is an environment of sustainable growth. The most compelling argument for the G8 existing is that it has the power to co-ordinate macroeconomic policy to provide such growth. Within such a climate, governments, employers and unions must find new means of balancing flexibility and security in employment. In my experience the two are inextricably linked in the policies of world class companies, and have been prominent features in those economies that have not only achieved sustained strength but have managed to share the consequent prosperity more equitably. For working people to join with their employers in adapting the workplace to the demands of increasing competition and technological change, there has to be trust. A trust that is hard to build but easy to destroy. Governments cannot legislate for such trust, but they can legislate to promote the dialogue that has been a proven pathway to that trust. It is good to see that the European Union has moved to strengthen the role of dialogue in their fight against unemployment. The aggressive competitiveness of globalising trade has resulted in an attack on standards we took for granted and has greatly dampened the expectation of millions within the OECD, and that includes trade unions and their members. But our aspirations are as strong as ever. While we have long since recognized the improbability of a future that promises lifetime employment in one job, trade unions nor their members will ever accept lifetime insecurity in every job. I have arrived here from a trade union conference in Moscow on the non-payment of wages. Millions of Russians are clinging even without pay to the hope that their jobs will survive. If I or any trade unionist needed convincing that a new level of co-operation is now required between government, employers and trade unions to tackle the avoidable tragedy unfolding in Russia, that conference provided stark confirmation. We are here today to play our part not only in sharing plans to beat unemployment but to make them work.



THE KOBE G8 JOBS CONFERENCE 28 - 29 November, 1997 Introductory Remarks by Etsuya Washio President of RENGO, Japan

Thank you Mr. Chairman and brother Jordan. At our 1996 ICFTU World Congress, delegate after delegate from over one hundred countries spoke about the fears of working women and men over their jobs, insecurity in employment, worries about pay, increased intensity of work, authoritarian management, union busting, discrimination, children at work when they should be at school, dangerous and unhealthy working conditions, and most of all the difficulty in getting workers' views heard. Although they saw in globalization the potential of expanding markets for reducing unemployment and poverty, what they felt from many of their members was the pressure of increased competition undermining employment stability, working conditions and basic workers' rights. Their answer to these problems was not a reversal of the process of opening up trade and investment, but for stronger rules to ensure that core labour standards are universally observed in the new global economy. Aimed at preventing repression against unions, discrimination in employment, forced and child labour, these core standards are enabling rights defined by the ILO, which all countries regardless of their level of development can and should apply. In fact a majority of countries have ratified these Conventions. With these rights workers have a voice, an opportunity to have their say about their working conditions. Our demand is therefore a simple but powerful one that we believe anybody who professes to believe in democracy and human rights can accept. But these rights are all too often abused, and as a result legitimate grievances and aspirations for a better future are suppressed. I would take one example to explain our position. I am greatly concerned about the social impact of the recent turmoil in Asian financial markets. Just like the Indonesian forests after the drought, we now have a social tinderbox in our region which could burst into flames very easily but we have very few fire fighters. The main scenario for Asia's economic recovery following the financial turmoil is through exports made cheaper by the dramatic and I would say exaggerated currency devaluations. This could produce a reaction in the industrialized countries, who already feel a certain anxiety about competition with Asian countries, with allegations that a small rich elite are making their fortunes through the exploitation of workers, many of whom do not enjoy basic human rights at work. This reaction would be based on the fact that most of Asian countries have not in fact ratified the core labour Conventions of the ILO World trade is a complex chain of inter-woven contracts across national boundaries, but the first link in that chain is the exchange of work for pay. The absence of agreed rules for the full application of core labour standards is a gap that could threaten the whole elaborate edifice of the global market. Without common rules applied by all member states of the WTO, and based on the competence of the ILO, workers can have no confidence that their efforts to meet the challenge of competition will not be unfairly undermined by the pressure for a quick profit. There is an argument that core labour standards have no relation to trade. This is wrong. Labour and Trade Ministers here in this conference are amongst the best placed to ensure that trade questions and labour standards are not artificially separated in the discussion about how to respond to the challenges of globalisation, and that the benefit from global trade will be fairly distributed among all people. I would urge Labour Ministers here in Kobe to renew your support for stronger international action on core labour standards through both the ILO and the WTO. Last but not least, I also strongly advise you to take a close interest in the employment impact of policies on climate change. Next week in Kyoto Environment Ministers, with the best of motives, could take decisions on reducing greenhouse gas emissions which cut right across your efforts to reduce unemployment. I wish you full success of Kobe Employment conference. Thank you very much for your attention.


THE KOBE G8 JOBS CONFERENCE 28 - 29 November, 1997 Statement by John Evans TUAC General Secretary

I would repeat something implicit in Bill Jordan's initial remarks. Populations in the G8 countries want two things: - They want economies which are efficient, that create decent jobs which generate decent and sustainable living standards; - And they want societies which are fair, where there is social cohesion and not a large number of people excluded from prosperity. Over a longer time span neither of these objectives can be achieved without the other. Economies are not efficient if you have to build walls or prisons to confine society's losers, whilst social progress can only be built on economies which work. None of the countries represented around the table today is satisfactorily achieving both objectives - most are failing on both counts; so the task of this conference is vast and important - there can be no room for complacency or cynicism. You have before you a written statement from the trade unions in the G8 countries, which has been drawn up by TUAC and the ICFTU jointly. I would emphasize two points central to your discussion on theme 2 of your conference: the Industrial Implications of Structural Change. Firstly, reconciling efficiency and social cohesion when faced by change starts at the workplace. Both unions and our members are at the sharp end of change - we cannot duck it. Faced by accelerating technological change and globalization we have a new and clear focus on what works and what doesn't. What works is investing in human capital - the worker. That means: - Investment in quality education; - Development of training systems which integrate workplace and classroom learning; - Delivery of recurrent education for workers throughout their lives; and - Recognizing and certifying skills based on experience. In sum it means lifelong learning. What also works is empowering workers. That means: - Ending hierarchical organizations; - Giving workers a voice in the change process; and - Motivating them and giving them a fair share in the benefits of change. What doesn't work, and what will end in social disaster is trying to push change through fear: the deregulation of labour markets, pushing down minimum wages and removing security. If workers don't have security in change then they will seek security by finishing change. Chair, last month our counterpart - Minister Melkert of the Netherlands - Chairing the OECD Labour Ministerial meeting said there was "a remarkable consensus among Ministers" on the need for policies that "stimulate people to accept change without fear". I hope he was right and I hope in your conclusions tomorrow you will be able to very clearly state this philosophy of change. This, I believe is the core of what some of our political leaders have called "the third way". My second point is that workers, labour markets and Labour Ministers cannot solve all the problems thrown up by world financial markets. You must give this message to your colleagues in Finance ministries and central banks. Economic growth is not enough to generate jobs and is still necessary. The current domino effect of financial failures must be brought to a very early halt - growth in the real economy must be supported and protected and the real lessons heeded - avoiding speculative bubbles in the future and building some "fire breaks" in the global financial markets. We make some suggestions in our statement. Chair, a few minutes of financial market trading can wipe out years of difficult progress and real adjustment. We also have to keep a "growth focus" for fiscal and monetary policy: the bond market vigilates frequently are wrong. Chair, our membership will be looking to the message you give tomorrow after your deliberations. I recall that six and a half years ago the London Summit had 72 pages of conclusions and the word unemployment did not appear once. There are now Jobs Summits, Ministerial meetings and conferences in fast succession, I believe we must take this as a sign of progress. Just as I believe the OECD and EU meetings were positive outcomes. But we must now bench mark some clearly recognizable objectives and measure progress by action. Governments cannot do everything on their own - the social partners presence here today is an important signal and we want to work with you and employers to replace cynicism and despair in the public mind with determination and confidence.

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