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| Solving Europe's unemployment problems - your ideas | Solving Europe's unemployment problems - your ideas |
| (8 days later) | |
| At the beginning of our Europa series on the continent's jobless generation, we asked readers for their views on how to tackle widespread unemployment in the EU. Here Heather Stewart, the Observer's economics editor, gives her thoughts and analysis of some of the ideas put forward | At the beginning of our Europa series on the continent's jobless generation, we asked readers for their views on how to tackle widespread unemployment in the EU. Here Heather Stewart, the Observer's economics editor, gives her thoughts and analysis of some of the ideas put forward |
| Employability | Employability |
| BallaBoy is exactly right that it's not enough to pretend that this is an issue of making people 'more employable'. The conditions imposed on Greece and the other recipients of EU/IMF aid since the eurozone crisis erupted have all involved so-called structural reforms of the labour market, which can mean improving skill levels, opening up closed professions, and weakening the bargaining power of unions. | BallaBoy is exactly right that it's not enough to pretend that this is an issue of making people 'more employable'. The conditions imposed on Greece and the other recipients of EU/IMF aid since the eurozone crisis erupted have all involved so-called structural reforms of the labour market, which can mean improving skill levels, opening up closed professions, and weakening the bargaining power of unions. |
| Such reforms may have their place, but they're not suddenly going to cause thousands of jobs to spring up spontaneously, any more than, in the UK, Adrian Beecroft's proposals for no-fault dismissal would fix our unemployment problem. | Such reforms may have their place, but they're not suddenly going to cause thousands of jobs to spring up spontaneously, any more than, in the UK, Adrian Beecroft's proposals for no-fault dismissal would fix our unemployment problem. |
| Firms are not hiring for two interlinked reasons: the crippling uncertainty of the eurozone crisis; and a severe lack of demand. Why hire staff if you've got no customers to sell to? | Firms are not hiring for two interlinked reasons: the crippling uncertainty of the eurozone crisis; and a severe lack of demand. Why hire staff if you've got no customers to sell to? |
| Government investment | Government investment |
| ibnalinklisi says: | ibnalinklisi says: |
| we solve the problem with a big investment by governments: infrastructure projects, green energy, and new public housing. | we solve the problem with a big investment by governments: infrastructure projects, green energy, and new public housing. |
| To some extent, that's right: we do need more demand across Europe, but it needs to come from the nations that can most afford it - primarily, Germany. At the same time, even those countries that have been forced into austerity should be aiming at protecting investment spending, which can safeguard jobs, and should boost the country's economic potential. That was one of the recommendations in the European commission's report on the UK economy on Wednesday. | To some extent, that's right: we do need more demand across Europe, but it needs to come from the nations that can most afford it - primarily, Germany. At the same time, even those countries that have been forced into austerity should be aiming at protecting investment spending, which can safeguard jobs, and should boost the country's economic potential. That was one of the recommendations in the European commission's report on the UK economy on Wednesday. |
| Sharing the work | Sharing the work |
| Lots of contributors, including RationalMind and OldBristolian, suggest some version of sharing work around better, with each person working shorter hours for less money. Mainstream economists would say these ideas fall foul of the "lump of labour" fallacy: the idea that there's a fixed amount of work in an economy, which we can just share out between us. There is also an enormous practical problem about how you go about implementing this idea: does the government suddenly just legislate for everyone to be sent home at a certain time, and paid less accordingly? It's unlikely to be a votewinner. | Lots of contributors, including RationalMind and OldBristolian, suggest some version of sharing work around better, with each person working shorter hours for less money. Mainstream economists would say these ideas fall foul of the "lump of labour" fallacy: the idea that there's a fixed amount of work in an economy, which we can just share out between us. There is also an enormous practical problem about how you go about implementing this idea: does the government suddenly just legislate for everyone to be sent home at a certain time, and paid less accordingly? It's unlikely to be a votewinner. |
| However, there are a growing number of free-thinking economists who've started to ask whether in the rich world we've got ourselves on a treadmill, working more and more hours to sustain a certain lifestyle - and leaving some in society, including the unemployed, far behind. A new book by Robert and Edward Skidelsky, How Much is Enough?, tackles some of these issues. BachPedlar helpfully includes a quotation from Juliet Schor, of Boston College: "improving working hours provides us with what we call in economics a triple dividend possibility: improving the employment picture, improving ecological outcomes and improving quality of life." | However, there are a growing number of free-thinking economists who've started to ask whether in the rich world we've got ourselves on a treadmill, working more and more hours to sustain a certain lifestyle - and leaving some in society, including the unemployed, far behind. A new book by Robert and Edward Skidelsky, How Much is Enough?, tackles some of these issues. BachPedlar helpfully includes a quotation from Juliet Schor, of Boston College: "improving working hours provides us with what we call in economics a triple dividend possibility: improving the employment picture, improving ecological outcomes and improving quality of life." |
| Preparing graduates | Preparing graduates |
| JScreen's worry about whether many degree courses prepare their graduates for life in the 21st century economy are likely to become increasingly pressing as students emerge from university with hefty debts, into a grim labour market. But it's tough to try and make a call at age 18 about exactly what "technical skillset" will be required in the future. [Disclaimer: I studied politics, philosophy and economics - decidedly non-technical]. | JScreen's worry about whether many degree courses prepare their graduates for life in the 21st century economy are likely to become increasingly pressing as students emerge from university with hefty debts, into a grim labour market. But it's tough to try and make a call at age 18 about exactly what "technical skillset" will be required in the future. [Disclaimer: I studied politics, philosophy and economics - decidedly non-technical]. |
| Protectionism | Protectionism |
| There are lots of calls for protectionism - restricting trade with non-European countries - not least from spineynorman. I would argue that Britain has taken the idea of open markets too far, inviting overseas firms to gobble up our firms, sack great swaths of the workforce and hide the profits from the taxman without so much a whisper of dissent, for example. But the problem with shutting, say, Chinese or Indian goods out of our markets, for example, would be that these are likely to be some of the strongest, fastest-growing economies in the coming 50 years, and one of Europe's few routes to success must be to sell their rising middle classes as many Mercedes, Italian handbags and bottles of whisky as we possibly can. Kicking off a trade war wouldn't be a great start. | There are lots of calls for protectionism - restricting trade with non-European countries - not least from spineynorman. I would argue that Britain has taken the idea of open markets too far, inviting overseas firms to gobble up our firms, sack great swaths of the workforce and hide the profits from the taxman without so much a whisper of dissent, for example. But the problem with shutting, say, Chinese or Indian goods out of our markets, for example, would be that these are likely to be some of the strongest, fastest-growing economies in the coming 50 years, and one of Europe's few routes to success must be to sell their rising middle classes as many Mercedes, Italian handbags and bottles of whisky as we possibly can. Kicking off a trade war wouldn't be a great start. |
| And as for AmbitiousMinds' call for better financial education, judging by the dog's breakfast eurozone leaders have made of economic management over the past two years, it's not just kids who could do with brushing up on their numbers. | And as for AmbitiousMinds' call for better financial education, judging by the dog's breakfast eurozone leaders have made of economic management over the past two years, it's not just kids who could do with brushing up on their numbers. |
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