Skill requirements are changing rapidly as a result of structural shifts
1. The speed and nature of globalisation, technological change and innovation, changes in work organisation, environmental change and demographic trends take very different forms across G20 countries. But in all of them, they are affecting what kind of work is done, who carries it out and where and how it is carried out. These transformations are affecting many traditional jobs and employment relations while creating new job opportunities in emerging economic activities. Some of these shifts risk widening existing inequalities and marginalising some groups in the labour market. Labour market policies, as well as policies affecting markets for goods and services, can facilitate the required adaptation while offering support to the workers directly affected by changes so as to foster employability, productivity, innovation, and enhanced growth and a better share of its benefits.
Workforce employability is essential to turn structural change into an opportunity for all
2. Increasing the employability of the workforce in the face of ongoing and future structural changes can help foster innovation and the adoption of new technologies as well as boost productivity by speeding up the reallocation of labour from less-productive activities to more productive ones and improving the well- being of workers. Technology also provides the opportunity to expand access to new jobs and to make employment more inclusive. At the same time, it also open opportunities for the creation of new businesses, and offers existing firms opportunities to access to new markets, expand sales and create more jobs.
Education and training systems, labour markets, workers and workplaces will have to become more adaptable
3. The flexibility and incentives of education and training systems and stakeholders need to be enhanced to respond more promptly to emerging skill needs. The adaptability of the workforce – both workers and jobseekers – should be encouraged through the development of transferable skills, broader vocational profiles and competency-based training delivered through programs that incorporate work-based learning, including quality apprenticeships. Employers need to work with education and training institutions to ensure the provision of relevant skills, including through apprenticeship places; provide on-the-job training to facilitate the upgrading and adaptation of skills; and adopt forms of work organisation that make the most of existing skills. The private sector can also be a key provider of skills training, either within the firms or by offering services to other firms and individuals. A key to the success of private sector initiatives is ensuring that contracts are designed to provide the right incentives and cost-sharing mechanisms to meet the needs of employers and job seekers. Finally, institutional settings and incentives should encourage and support all stakeholders, including the private sector, to co-operate in efforts to assess and anticipate skill needs. This information should then feed into employment and education policies in an effective and timely way to ensure that training decisions and the content of training offered are responsive to identified and emerging shortages and the right incentives are in place for training providers to meet these needs.
Developing a set of concrete actionable principles
4. In the context of the challenges confronting G20 economies, a set of concrete actionable measures is proposed to improve the employability of each economy’s workforce, making skills more transferable and workplaces more adaptable. The main objectives of these principles are to:
- Stress the importance of assessing and anticipating rapidly changing skill needs so that they can be addressed through responsive education and training systems, public or private;
- Reaffirm the importance of transferable skills for promoting labour reallocation in the face of structural change and ensure workers are ready to take advantage of new opportunities;
- Identify actions that countries could take to improve the employability of their workforce in a broader context of effective labour market policies and balanced employment protection legislation; and
- Highlight the importance of policy coherence through a whole-of-government approach with full stakeholder engagement, including the private sector, and strengthened interactions between the world of work and the world of education and training;
- Promote institutional reform in public training organisations and improved arrangements for how key stakeholders can come together to enhance local skill solutions, including through co- ordination mechanisms such as skill ecosystems/clusters and skills councils.
- Address market and/or government failures that might be reducing incentives to invest in training at the firm level.
5. These principles are summarised around four areas: i) anticipating skill needs and adapting policies accordingly; ii) reinforcing the role of training and work-based learning; iii) enhancing the adaptability of workplaces; and iv) promoting labour mobility.
Chosen excerpts by Job Market Monitor. Read the whole story at Enhancing employability: report prepared for the G20 Employment Working Group