Jobs Boom Illusion

A recent article on Economist noted as a bleak picture that “today’s workers, if they are lucky enough to escape the gig economy and have a real job, have lost control over their lives. They are underpaid and exploited by unscrupulous bosses. And they face a precarious future, as machines threaten to make them unemployable.”.

   Instead of this, they argue that “most of the rich world is enjoying a jobs boom of unprecedented scope”, and that “capitalism is improving workers’ lot faster than it has in years, as tight labor markets enhance their bargaining power.”. Also, the article stated that capitalism and jobs boom deserve a little appreciation.

   However, they referred only to unemployment rates (OECD is about 5%-7%), rather than other significant real-life issues. Harmonized unemployment rate defines the unemployed as people of working age who are without work, are available for work, and have taken specific steps to find work. But, what about long-term unemployment rate, employment rate, part-time employment rate, temporary employment, and in general the total hours worked and paid?

   Long-term unemployment refers to people who have been unemployed for 12 months or more. The long-term unemployment rate shows the proportion of these long-term unemployed among all unemployed. OECD (Total 2017): A dramatic 31% of unemployed.

   Employment rates are defined as a measure of the extent to which available labor resources (people available to work) are being used. They are calculated as the ratio of the employed to the working age population. OECD (Total Q4 2018): 68.6% of working age population.

   Part-time employment is defined as people in employment (whether employees or self-employed) who usually work less than 30 hours per week in their main job. OECD (Total 2017): A huge 16.5% of employment.

   Temporary employment includes wage and salary workers whose job has a pre-determined termination date. OECD (Total 2017): 11.2% of dependent employment.

   Average annual hours worked is defined as the total number of hours worked per year divided by the average number of people in employment per year. Actual hours worked include regular work hours of full-time, part-time and part-year workers, paid and unpaid overtime, hours worked in additional jobs, and exclude time not worked because of public holidays, annual paid leave, own illness, injury and temporary disability, maternity leave, parental leave, schooling or training, slack work for technical or economic reasons, strike or labor dispute, bad weather, compensation leave and other reasons. The data cover employees and self-employed workers. This indicator is measured in terms of hours per worker per year. OECD (Total 2017): 1,746 hours per worker.

   Finally, wages are far from their great level, as the above temporary and low paid formats in job environment do not offer opportunities for many people. Also note that OECD (Organization for Economic Co-operation and Development) countries are ageing. Demographic change transforms the economic cycle, while technological adoption is again an unexpected negative factor for many sectors.