IF not now, when are we creating good quality jobs?

We all agree on the need for more quality jobs to build momentum for recovery and climb out of the recent crisis. But what does this mean? And what realistic plans are in place to achieve growth that is rich in quality jobs?

To realise the ideals of the “Malaysian Dream”, job quality is essential. However, today, Malaysia appears to be experiencing a job quality crisis.

Jobs available seem to be of lower quality. And such low quality jobs are unhealthy for individuals and society.

People in low quality jobs endure financial stress, ill health, and social stigma. Such jobs exacerbate social and economic inequities across race, ethnicity, and gender. Women, workers of colour, and immigrants are disproportionately employed in low quality jobs.

And such poor quality jobs hinder economic growth and strain public budgets.

They are usually designed to minimise labour cost for an individual business and accommodate high turnover. It limits the purchasing power of a large segment of consumers, reducing the strength of the economy as a whole. They strain public resources, as a growing segment of workers relies on a variety of means-tested benefits especially during the crisis period.

If such a trend of low quality jobs continues, it will certainly harm a large and growing portion of the workforce in this country and the economy, society as well as the aspirations of the country. The risk of the economy being trapped in the middle income bracket remains.

In a recent speech by Datuk Seri Mustapa Mohamed, Minister in the Prime Minister’s Department (Economy), he pointed out the need to “leverage on trade and investment to create quality employment for our people. By attracting quality investments, it will create more higher paying jobs that will pay well above the minimum wage”.

Such a perception is certainly positive. Quality jobs create quality workforce and welfare. Companies and places that are a foundation from which broader prosperity grows, provide workers with the opportunity for self sufficiency, economic security and, a sense of control over their lives. Individuals can raise their living standards and accumulate assets.

Benefits such as health insurance and paid sick leave improve family security.

They will help ensure that an illness does not impose a heavy financial burden on an employee or a family as that person can both afford diagnosis and treatment and take paid time off for it.

Workers who feel economically secure spend their time outside of work on activities that strengthen their social networks and also their communities.

Benefit to business community

Business competitiveness will benefit from the increase with the quality jobs falling in line with the economic competitiveness. It is fundamental to the argument behind high road economic development strategies. In this 21st century, a “race to the bottom” is not a winning economic development formula.

It is not only bad for workers, families, the environment and society, but also in competing globally on the basis of low costs that is seen to be increasingly disappearing as an advantage for the economy.

With the increasing focus on “sustainability” and “inclusiveness”, low job qualities are at the risk of being eliminated through technological or productivity enhancements. Businesses that rely on low costs to succeed are unlikely to be competitive in the long run as opposed to businesses that compete based on the quality of their products or services, or ability to innovate.

In this globalised environment, profits and competitiveness stem from increasing productivity, which can be improved in two ways – technology and labour.

And quality jobs chart the pathway for sustainability, inclusivity and economic growth for the local economy. When more quality jobs are created, the workers are paid higher wages.

This will boost private consumption through spending on housing, goods and services. There will be a pickup in discretionary spendings. Wages cycle will boost the economy in the form of increased tax revenues from private expenditure, and taxes via direct and indirect. It will help reduce the poverty level along the way through private investment, public spending as well as public-private partnership.

How to build job quality into our workforce environment?

Until March 2020 and the onset of the Covid-19 pandemic, unemployment in the country was low. Despite the low unemployment rates, many workers struggled to find quality jobs – those with decent pay, benefits, and predictable hours.

Then Covid-19 shook our country’s economy to the core. We reported the worst recession since the 1997 Asian Financial Crisis. The economy plunged by 5.8%. Many lost their jobs and had to survive doing informal work and living on their lifetime savings which depleted fast. Many also hardly had savings to keep them going, especially the B40 category.

Instead of security, workers in low wage jobs were experiencing reduced hours, temporary layoffs, unpredictable schedules, variable earnings and an overall lack of health and retirement benefits.

This same story is playing out in other countries too.

As workers strive for a “new normal,” the effects of Covid-19 pandemic and now the climate change impact is putting bare economic shocks that are likely to shake the economy far beyond even the most conservative timelines.

In discussion with the range of workers, job seekers, and aspiring entrepreneurs irrespective of race, ethnicity, gender or from rural, urban, and suburban locales or young adults starting out and displaced workers seeking to build a new career, they are looking to earn a living. Hence, high quality jobs, whether working for someone else or for yourself, make a meaningful difference in a person’s life.

However, with the current response to the economic downturn, emphasis is on increasing the jobs quantity locally available. This is only a temporary solution. Over a longer term, a greater focus must be on the quality of local jobs needed. Employers must better utilise the human resources available to them, raising job satisfaction and incomes at the same time as boosting local productivity.

Now, there is a serious need to establish a “job quality” framework.

This framework is designed to measure and assess the quality of jobs that considers three key objectives and measurable dimensions. The “earnings quality” as it unveils the extent to which earnings contribute to workers’ well being in terms of average earnings and their distribution across the workforce.

Next we have the “labour market security” that shows those aspects of economic security related to the risks of job loss and its economic cost for workers. The “quality of the working environment” that captures non economic aspects of jobs include the nature and content of the work performed, working-time arrangements and workplace relationships.

In this respect, the framework needs to look into areas such as “job necessities” which will create the condition of a fair working environment.

Besides, it will be “job opportunities” that will help maximise individual and organisational potential to achieve positive growth and financial results that will benefit both the employers and employees. Finally is on the “job features” which serves as the key driver of attraction and retention of quality workforce.

A need for different policy instruments

To this, a number of different policy instruments are needed such as incentives for employers to invest in new technology and the promotion of more effective forms of work organisation. Working with intermediaries is particularly important, as is developing joined up strategies and governance mechanisms that encourage a focus on both the supply and demand for skills.

There must be better accessibility for the local people to quality jobs to avoid the development of a divide between well paid “skill haves” and poorly paid “skill have nots”.

Employers need to offer progression opportunities for lower skilled workers to allow them to move up into better skilled jobs over the course of their lifetime.

But the challenge is that employers are unlikely to invest in the training of low skilled staff. And internal career ladders tend to become more and more fragmented. This is where there is a need for a new model for employment progression. Public institutions need to work together with employers to recreate traditional career ladders externally.

Career ladders and career clusters offer a useful way to bring together employment agencies, careers advisors, education and training bodies and industrial consortia to design route maps to train and employ the low skilled. They also help to make the labour market more transparent which facilitates supply and demand matching.

In this context, there is a need to look at firstly, gap analysis that targets industries and jobs that will support individual advancement and growth; secondly, planning of career pathways through partnership of public private; thirdly, co-ordinate the work of the partnership; fourthly, evaluate and continuously improve career pathways programmes and services; and finally, expand the pathways process to involve other partners, populations of participants and sectors.

While career ladders can support progression in individual industries and sectors, it is important to also build career clusters via horizontal links across sectors at a local level. This approach recognises that the generic skills which make people employable in today’s economy go across many different sectors. With the right technical training, people can progress by moving horizontally as well as vertically.

Career ladders and career clusters offer a useful way to bring together employment agencies, careers advisors, education and training bodies and industrial consortia to design route maps to train and employ the low skilled. They also help to make the labour market more transparent which facilitates supply and demand matching.

In this context, there is a need to look at firstly, gap analysis that targets industries and jobs that will support individual advancement and growth; secondly, planning of career pathways through partnership of public private; thirdly, coordinate the work of the partnership; fourthly, evaluate and continuously improve career pathways programmes and services; and finally, expand the pathways process to involve other partners, populations of participants and sectors.

While career ladders can support progression in individual industries and sectors, it is important to also build career clusters via horizontal links across sectors at a local level. This approach recognises that the generic skills which make people employable in today’s economy go across many different sectors. With the right technical training, people can progress by moving horizontally as well as vertically.

Education, training is key

Finally, it is extremely important to have a strong education and training. It needs to be redesigned to provide courses and training programmes that are modular and adaptable which prepares the future workforce, working adults and participate within career cluster type initiatives.

We are now in the transitional stage. Demand will gain traction for people who demonstrate greater proactiveness, initiative, discipline and collaborativeness. Also in traits including leadership, design thinking, “human meta communication,” deliberation, conflict resolution, and the capacity to motivate, mobilise and innovate.

And for more practical needs to work with data and algorithms, to implement 3D modelling and work with 3D printers, or to implement the newly emerging capabilities in artificial intelligence and augmented and virtual reality.

The development of quality jobs lies in the future of jobs and jobs training. A wider array of education and skills building programs will be created to meet new demands. This is a salient uncertainty. Will well prepared workers be able to keep up in the race with digitalisation and technological advancement?

We must remember “people will create the jobs of the future, not simply train for them. Technology is already central and will play a greater role in the years ahead. We must be serious to work on developing quality jobs and not just ride on quantity jobs by reflecting low unemployment rates”.

Source: https://www.thestar.com.my/business/business-news/2022/01/10/quality-jobs-needed-to-aid-recovery-momentum