flexibility aiding response to crisis and economic recovery INESS International conference Raoul Ruparel CoDirector UK labour market response to crisis 25112015 2 25112015 3 UK labour market response to crisis ID: 625335
Download Presentation The PPT/PDF document "UK Labour market" is the property of its rightful owner. Permission is granted to download and print the materials on this web site for personal, non-commercial use only, and to display it on your personal computer provided you do not modify the materials and that you retain all copyright notices contained in the materials. By downloading content from our website, you accept the terms of this agreement.
Slide1
UK Labour market flexibility - aiding response to crisis and economic recovery
INESS International conference
Raoul Ruparel
Co-DirectorSlide2
UK labour market response to crisis
25/11/2015
2Slide3
25/11/2015
3UK labour market response to crisisSlide4
UK labour market response to crisis
25/11/2015
4Slide5
How did this response help?
Kept employment levels highLess distortion in labour marketFirms kept labour on hand to deploy in recovery
Avoided loss/deterioration of skillsBreaking down/rebuilding a workforce is incredibly costly
Kept income flowing, helped consumption/demand led recovery
Limited negative political fallout
25/11/2015
5Slide6
How did this response help?
25/11/2015
6Slide7
What specific policies helped?
25/11/2015
7Slide8
What specific policies helped?
Flexible wage determinationContract and hours worked flexibility
Environment for growth in self-employment
Incentives to stay in work
Other aspects such as use of agency workers and professional management
25/11/2015
8Slide9
Flexible wage determination
25/11/20159Slide10
Flexibility in Hours/contracts
25/11/2015
10Slide11
Growth in Self-employment
25/11/2015
11Slide12
Incentives to stay in workNobel
Prize Winner Christopher Pissarides captured it quite well in a 2013 paper where he said:“The reforms shifted the labour market policy incentives to employment through
tax reductions and tougher unemployment (and non-participation) support, and increased the institutional flexibility of the labour market. Important reforms took place in the role of trade unions and employment protection legislation.”
25/11/2015
12Slide13
To what extent is this approach replicable?
Plenty of points cited so far are replicable, though self-employment requires a certain positive business climate.Quite a few issues/circumstances which are replicable:
Attracting talent/immigration more broadlySunk costs in skilled workers
Inflation aiding real terms wage adjustment
25/11/2015
13Slide14
Low real wagesProductivity problems
Labour hoarding, lack of redeployment of human capitalPoor matching of skills
UnderemploymentFavour cheap labour over more expensive capital
25/11/2015
14
What are the potential drawbacksSlide15
25/11/2015