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Devising Minimum Wages in Emerging Markets

Jobs Group's picture

Raising awareness about Wisconsin's minimum wage, Milwaukee, August 1, 2012. Photo: Flickr/wisconsinjobsnow (Wisconsin Jobs Now)

Given the confusion about the pros and cons of minimum wages in advanced economies, let alone in emerging markets, what types of information should policy makers be armed with? In this blog, we speak with two experts on the topic – John T. Addison (Professor of Economic Theory, University of South Carolina) and David Neumark (Professor of Economics, University of California, Irvine) – both of whom stress the importance of weighing the trade-offs for their own countries, along with pinpointing who will be the winners and losers.

Demystifying the Impact of Minimum Wages

Jobs Group's picture

Singapore Clarke Quay Elgin Bridge underpass 2013 (by RSCLS street art collective). Photo: Flickr/66944824@N05 (Denis Bocquet)

In recent years, the minimum wage has become an increasingly popular policy instrument to reduce inequality in many emerging markets (like China, Hong Kong, and Cambodia), with others (like Singapore) weighing whether to adopt one. But a lot of confusion still surrounds the impact of minimum wages in advanced economies, let alone what might occur in the emerging markets. In this blog, we speak with two experts on the topic: David Neumark (Professor of Economics, University of California, Irvine) and John T. Addison (Professor of Economic Theory, University of South Carolina). They both point to some job loss, especially for skilled workers, in advanced economies.

A Ranking of Adult Workers and Their Skills

Stefano Scarpetta's picture

Elementary school, Gimhae, Korea. Photo: Flickr/65817306@N00 (Jens-Olaf Walter)

In the world’s richest countries, those with greater inequality in skills proficiency also have higher income inequality, according to the first OECD Survey of Adult Skills (also known as PIAAC), which measures the skills of 16-65 year-olds across 24 countries. The survey includes assessments of adult reading, numeracy, and place in the digital divide. The OECD's Stefano Scarpetta (Director of Employment, Labour and Social Affairs) tell us that this is the first ever comprehensive survey of the actual competencies of OECD adult workers.

With Large-Scale Temporary Employment, Is Poland the Next Spain? — Part 1

Piotr Lewandowski's picture

Car production line, Tychy, Poland. Photo credit: iStock ©Tramino

The political and economic transition of post-communist Central and Eastern European (CEE) countries brought substantial improvements in GDP per capita, productivity, incomes and standard of living. But certain worrying phenomena emerged on the labour markets. One of these was a rise in temporary employment, which has created a “dual labor market” – that is, a segmented market with workers in one segment more privileged than those in the other. For the CEE economies – especially Poland – the onset was in the 2000s. A variety of possible solutions exist, but so far the Polish government has done little to improve the situation.

Replacing Europe’s Dual Labor Markets with a Single Contract

Tito Boeri's picture

In recent decades, many European countries have tried to instill greater labor market flexibility through increased use of fixed-term, temporary work contracts, as opposed to open-ended or permanent ones. The result has been dual labor markets, with temporary workers having fewer rights and job security than those on permanent contracts. One expert on the topic – Tito Boeri, Professor of Economics and Dean for Research at Bocconi University, Milan – stresses that temporary workers were especially hard hit during the Great Recession.

International Women's Day: A Serbian Perspective

By Mirjana Popovic and Vesna Kostic

Mar. 8: Working Women’s Day or Jobless Women’s Day in Serbia?

By Mirjana Popovic, Online Communications Producer

In the former Yugoslavia, where I was born, International Women’s Day used to celebrate respect and appreciation for women in society: mothers, wives, female colleagues – in this order.

What is it like in today’s Serbia? The glory of the holiday has faded and new challenges have arisen.

Women in the Workforce – a Growing Need in Emerging Europe and Central Asia

Sarosh Sattar's picture

Emerging Europe and Central Asia (ECA) is an interesting region because what you expect is not always what exists. Since this is written in honor of International Women's Day, discussing women’s labor market participation seems appropriate. The standard indicator used for this is the “female labor force participation” (LFP) rate, which is the proportion of all women between 15-64 years who either work or are looking for work. 

Since much of the region has a common socialist legacy, you would expect to see similar labor market behavior among women. However, the proportion of women who work ranges from a low of 42 percent in Bosnia and Herzegovina to 74 percent of adult women in Kazakhstan. And it wasn’t 20 years of social and economic transition that led to this divergence. Even in 1990, the range was about the same. The exception was Moldova which saw a 26 percentage point decline.

Homework from the Seoul G-20: Measuring Skills

Ariel Fiszbein's picture

The Seoul G20 summit in November ended with some homework for the World Bank. We were asked to work with the ILO, OECD and UNESCO to develop internationally comparable indicators of skills that can help countries in their efforts to better match education and job training to market needs.  The G20 was right to make this a priority. 

In this post-financial crisis period, jobs play an important  role in recovery. Making sure that people have the right skills to get these jobs is the other side. Developing countries, especially, know that skills development is necessary if they are going to attract investment that will create decent jobs and raise productivity.

Global Study to Explore Issues of Equity in Higher Education Around the World

By Roberta Bassett, Tertiary Education Specialist, Human Development Network    

The ability of a society to produce, select, adapt, commercialize, and use knowledge is critical for sustained economic growth and improved living standards. As a locus for both knowledge creation and dissemination, tertiary education institutions help countries build globally competitive economies by developing a skilled, productive and flexible labor force and by creating, applying and spreading new ideas and technologies. In middle and low-income countries, tertiary education works to build the institutional capacity that is essential to reducing poverty and achieving the Millennium Development Goals.

For that growth to be inclusive, opportunities to access and succeed in higher education must be as equitable as possible. A global study is being undertaken on Equity of Access and Success in Tertiary Education, funded by the government of the Netherlands through the Bank-Netherlands Partnership Program (BNPP).