The G20 and Jobs

The meeting of G20 Labour Ministers in Paris on September 26-27, held in advance of the November G20 Summit in Cannes, reached some conclusions which go some (extremely modest) way toward living up to prior G20 commitments in London and Pittsburgh to promote quality jobs and a more progressive labour market model as part of a long-term solution to the global economic crisis.

Ministers met with trade union and employer representatives, including myself,  in a half day session on their first day of meetings, and the ILO, with the OECD, was also invited to participate. There was one labour representative per country at the meeting with Ministers (and more from France.)

While annual G20 Labour Ministers meetings with the involvement of the “social partners” have not yet been formally institutionalized, this meeting convened by the French Presidency followed similar meetings in the US and Italy, and another will be held in 2012 under the Mexican G20 Presidency.

President Sarkozy of France and his Minister of Labour put a lot of effort into planning the G20 Labour Ministerial meeting, and likely the main conclusions will find their way into the G20 Summit communique.

Strong support for a major G20 focus on employment and the quality of jobs and a formal policy development and co-ordination process involving unions, employers and the ILO has been expressed by France with the support of most EU governments (excluding the UK); by some leading G20 developing country members, notably Brazil, Argentina and South Africa, as well as by the US. Reportedly, Canada has been generally opposed to this extension of G20 mandates to broad labour market and social protection issues.

The communique from the meeting expressed concern about the stalled recovery in the advanced economies, high unemployment, especially among youth, and the fact that the job market remains very weak.

It called for a continuing focus on employment issues, but did not call on G20 heads of state or finance ministers to take any specific demand side actions to create jobs. In reality, giving the priority to jobs is very much at odds with the focus of the G20 on deficit and debt reduction since the Toronto summit.

We strongly believe that employment must be our top priority. We are committed to urgently renew our efforts to promote creation of decent jobs and support workers and their families affected by unemployment and precarious employment…. Recognizing that decent work should be at the heart of strong, sustainable and balanced growth, we affirm our commitment to renewed attention to policies that improve employment creation and the quality of jobs, while strengthening at the same time social protection systems, respect for fundamental principles and rights at work, and promoting greater coherence of economic and social policy.

The meetings called on the G20 to set up a task force on employment, as advocated in the labour statement to Ministers, and this can be counted a modest step forward.

We recommend setting up an intergovernmental task force on employment, composed of the G20 representatives, with the contribution of relevant international organisations and consulting social partners as appropriate. The task force will provide input to the G20 Labour and Employment ministerial meeting to be held under the Mexican Presidency in 2012.

Labour had called for a task force with a broad mandate and the full involvement of the social partners and the ILO. However, some governments did not want a task force at all, and others wanted one with a relatively narrow mandate focused on youth unemployment. The final outcome was that “the first topic to be addressed will be youth employment” and that the social partners and the ILO will be consulted “as appropriate.” Further the task force “will be established on an experimental basis for one year and will not be automatically renewed.”

With respect to the issue of labour rights, there was some reasonable language in the communique but it fell well short of calling on all G20 governments to ratify the core ILO conventions as called for in the labour statement and earlier endorsed by President Sarkozy. Strong labour rights are needed to re-establish a link between productivity growth and real wage growth, and also to promote the agenda of decent jobs and greater equality.

The communique recommended that “our Leaders reaffirm their commitment to ensuring full respect for the Fundamental Principles and Rights at Work, as set out in the 1998 ILO Declaration” and “encouraged” the ILO “to continue promoting ratification and implementation of the eight Fundamental Conventions and its efforts to support and monitor the follow up to the implementation of the Fundamental Principles and Rights at Work by all of its members.” Rather vague commitments were also made to respect for social dialogue and enhanced systems of social protection.

The meeting also called on the G20 to “develop nationally defined social protection floors with a view to achieving strong, sustainable and balanced economic growth and social cohesion.” This is an endorsement of a process that will take place though the ILO, the World Bank, the IMF and others to encourage even low income developing countries to expand social protection, though not on the basis of an agreed set of programs at any particular stage of development.

As pointed out in the labour statement to the meeting, support for expanding the social dimension of globalization has to be implemented through IMF, WTO and World bank policies and programs. Yet, in practice, this is not the case eg when austerity programs attack social spending, wages and labour rights.

In sum, some of the language on the importance of jobs, decent work, labour rights and social protection will likely find its way into the Cannes communique – in significant part because this has been a focus of the French presidency of the G20.  There is some commitment to a serious consideration of these issues within the G20, but it is largely divorced from the current agenda of finance ministers. Nonetheless, a G20 task force on employment will likely move forward.