Continuing our countdown to the new decade, PSD blog is switching gears from technology and public finances to focus on a key source of concern in both developed and developing countries: jobs.
Here in Washington, speculation abounds that the success or failure of the Obama presidency is dependent on its ability to pull back unemployment from its current levels. Yet, the quality of new jobs may be as important as the quantity.
For example, today's Economix takes a look at the difference between permanent and contingent workers. The problem with boosting employment via contingent workers is that such workers are likely to spend less, hindering the overall economic recovery:
Generally speaking, the contingents and their families are less likely to spend as much as the permanents, and they have less access to credit. The implication of these circumstances is that too great a percentage of contingent workers can be a drag on growth because the economy is so dependent on consumer spending.
The loss (or devaluation) of well-paying, permanent jobs in the United States and Europe is best symbolized by trade unions and populist politicians harping about China "stealing jobs". Yet, these calls are no longer limited to wealthy nations. The New York Times recently pointed to the rise of anger in developing countries, particularly Vietnam, towards China's policies of exporting Chinese labor to its foreign economic projects:
China, famous for its export of cheap goods, is increasingly known for shipping out cheap labor. These global migrants often work in factories or on Chinese-run construction and engineering projects, though the range of jobs is astonishing: from planting flowers in the Netherlands to doing secretarial tasks in Singapore to herding cows in Mongolia — even delivering newspapers in the Middle East.
But a backlash against them has grown. Across Asia and Africa, episodes of protest and violence against Chinese workers have flared. Vietnam and India are among the nations that have moved to impose new labor rules for foreign companies and restrict the number of Chinese workers allowed to enter, straining relations with Beijing.
Meanwhile, as many the world's developing countries' populations grow younger, finding job opportunities for young workers will become an ever-greater priority. As Matthew Ygelsias notes today, sixty percent of the population in the Middle East is under thirty, and the youth unemployment rate in Arab countries is 26 percent.
The World Bank's Finance and Private Sector Development (FPD) Vice Presidency has put job creation schemes on the forefront of its agenda for next year. March's FPD Forum will focus on private sector jobs, growth, and the financial system. This year's G20 summit in Pittsburgh also paid heed to calls for job creation programs.
In light of this need to boost employment, World Bank publications such as Doing Business and Enterprise Surveys, which focus on improving domestic business environments in order to facilitate entrepreneurship and job creation, will grow increasingly important over the next decade, and are likely to inspire some spin-offs along the way.
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