The World Economic Forum’s first Jobs Reset Summit convened more than 1,000 leaders from government, business and civil society to shape a new agenda for growth, jobs, skills and equity.
It follows the Forum’s January 2020 launch of the Reskilling Revolution online platform to create better jobs, skills and education for 1 billion people by 2030. The platform hosts global, national and industry coalitions.
The Forum’s Closing the Skills Gap Accelerators are a global network of national efforts to improve skills, redeploy upskilled workers and promote inclusion. At last week’s summit, three new countries – Georgia, Greece and Turkey – joined Bahrain, Brazil, India, Oman, Pakistan, South Africa, and the United Arab Emirates to close skills and employment gaps in their countries.
“Closing the skills and employment gap has never been so urgent and vital to our economy and society as we recover from the pandemic. The Accelerator in Greece will work with major private-sector companies and Regeneration as the local coordinator to build partnerships that would mobilize investment for job creation and reskill our workforce for the jobs of tomorrow,” said Adonis Georgiadis, Minister for Development and Investment, Greece.
Georgia has set up a new platform, Skills Georgia, under the Accelerator, a public-private agency run as a non-profit organization that will “give the opportunity for the new generation to become more innovative; more start-up, tech and innovation-oriented with their entrepreneurial thinking,” said Tamar Kitiashvili, Deputy Minister of Education, Science, Culture and Sport, Georgia.
Turkey is launching the Closing the Skills Gap Accelerator championed by three ministers – Industry and Technology; Education; and Family, Labour and Social Services – showcasing the cross-governmental collaboration required for rapid action on skills.
Leading policy-makers from Bahrain, Brazil and Pakistan provided updates on the efforts in their respective Accelerators to adapt to the pandemic and deliver skills to workers and out-of-work individuals. Brazil’s Deputy Minister of the Economy revealed that under Brazil’s Accelerator more than 8 million people will be trained to increase their future employability in the next two years. In Pakistan, the Minister for Overseas Pakistanis and Human Resources highlighted a standardization and accreditation system in more than 10,000 training centres across Pakistan, created in close partnership with the private sector. Bahrain’s Minister of Youth showcased the efforts focused on young graduates to equip them with the skills of tomorrow.
The Reskilling Revolution platform also hosts the Skills Consortium of top online education and training providers. These companies and organizations, including Coursera, Udacity and EdX, shared their support of workers in the current context and the opportunities for further delivering on the promise of online learning and training through better accreditation and recognition by employers.
Business-led and intra-industry collaborations were also announced at the summit to create solutions for workers who can be rapidly upskilled and redeployed to a different role within their sector, leveraging both online and in-person training. For example, Crescent Petroleum shared its partnership with Edraak to provide online learning for youth in the Middle East and North Africa region, with over 240,000 people already registered.
A New Agenda for Economic Growth, Revival and Transformation
A community of leading chief economists from the public and private sectors supported the development of the Forum’s Dashboard for the New Economy. The proposed set of macroeconomic targets aims to steer the COVID-19 recovery beyond GDP growth alone and give governments the impetus to put the focus on people, planet, prosperity and institutions.
The Forum also launched a priority list of 20 of the most promising Markets of Tomorrow that are poised to generate sustainable and inclusive job creation and growth beyond today’s economic models. A network of Closing the Innovation Gap Accelerators will be taking forward investments in these new markets and innovation ecosystems.
A New Agenda for Work, Wages and Job Creation
The World Economic Forum’s Future of Jobs Report, released during the summit, highlighted the “double disruption” faced by workers in the face of the pandemic recession coupled with accelerated automation.
A coalition of more than 60 chief human resources officers partnered with the World Economic Forum and Mercer to create a new set of principles for the future of work through the Resetting the Future of Work Agenda.
As part of a network of Preparing for the Future of Work Accelerators across nine industries, the Consumer Industry Acceleratorannounced an initiative to create “reskilling and redeployment pathways” for thousands of employees. Leena Nair, Chief Human Resources Officer, Unilever, announced the collaboration with Walmart, Accenture and Skyhive. “It’s the first of its kind, non-competitive, collaborative partnership,” said Nair. The coalition is inviting companies from across industries to join the response to deal with the scale of the reskilling challenge.
A New Agenda for Equity, Inclusion and Social Justice
In addition, Jordan joined 10 other economies, including Argentina, Chile, Colombia, Panama, Costa Rica, Peru, Dominican Republic, Egypt and France, deploying the Closing the Gender Gap Accelerators to enhance opportunities for women in the workforce.
“The government of Jordan is committed to gender equality and women’s empowerment as an effective tool to combat poverty, hunger and diseases. Today’s launch of the Jordan Closing the Gender Gap Accelerator will help us incorporate gender as a cross-cutting theme in our economic recovery plans. It is also in line with our longstanding public-private collaboration efforts to create more equitable growth,” said Nasser Shraideh, Jordan’s Minister of Planning and International Cooperation.
The Future of Jobs Report highlighted how the impact of technology and the COVID recession on jobs has been worse for women, youth and lower-income workers. The newly launched Resetting the Future of Work Agenda highlights the win-win of diversity, equity and inclusion in this context, while the recent Diversity, Equity and Inclusion 4.0 Toolkithelps companies deploy the latest HR technologies to support this.
The Valuable 500 – committed to transforming disability inclusion through business leadership and opportunity, launched at the Forum’s Annual Meeting 2019 – announced an additional 100 members since January 2020. With 334 organizations worldwide, combined revenues of over $4.5 trillion and an employee base of 11.9 million, The Valuable 500, in partnership with the Forum, launched its Transformation Leadership Programme to build capability at leadership and C-suite level.
Notable Quotes from Leaders throughout the Summit
Environmental and social pressures have exposed the fault lines in the structure of global capitalism. Ray Dalio, Founder, Co-Chairman and Co-Chief Investment Officer of Bridgewater Associates, said: “Capitalism by its nature tends to create greater wealth gaps. There needs to be a coordinated effort to restructure how the machine works.”
Unilever’s Chief Executive Officer Alan Jope referred to COVID-19 causing a jobs crisis but urged action on two further crises, climate change and the nature of capitalism itself, “We must change the measures of success,” he said, moving beyond the preoccupation with measuring only GDP and profit as yardsticks for the recovery.
“We have a tech-savvy younger generation, and the challenge now is how do we equip them more”, said Rania Al-Mashat, Minister of International Cooperation of Egypt, and a Co-Chair of the Closing the Gender Gap Accelerator in Egypt.
Jonas Prising, Chairman and Chief Executive Officer of ManpowerGroup, described a two-speed recovery from COVID-19. “Businesses that are able to adapt are recovering quicker than those that cannot. The same is true for the labour market. People with the right skills will come back faster.”
For Angel Gurría, Secretary-General of the Organisation for Economic Co-operation and Development (OECD), “Coordination is missing in action,” he said. Yet, the only way to deal with issues of international trade, migration, climate change, employment and economic recovery from COVID-19 – even the search for a vaccine – is through multilateral cooperation.
The International Trade Union Confederation (ITUC) and others called for the creation of a Global Social Protection Fund for those hardest hit by the COVID-19 crisis. “About half of the world’s people have no social protection or any sense of security,” said Sharan Burrow, General-Secretary, International Trade Union Confederation (ITUC).
Geraldine Matchett, Co-Chief Executive Officer and Chief Financial Officer of Royal DSM highlighted how technology can help to enable fairer access to jobs and that “the COVID crisis has shown us that it’s very possible to change the definition and format of work.” Royal DSM is a founding partner of the Forum’s Hardwiring Gender Parity in the Future of Work framework.
Financing to Support Liberia’s Reforms for Promoting Inclusive Economic Growth
The World Bank Board has approved the third and last in a programmatic series of three Inclusive Development Policy Operations (IGDPO) designed to support key reforms that are critical to enabling inclusive growth. The financing, amounting to $55 million ($47.50 million International Development Association (IDA) concessional credit and $7.50 million IDA grant), will be disbursed as budget support. These reforms will remove distortions in key economic sectors, strengthen public-sector transparency, and promote economic and social inclusion.
The reforms supported in this programmatic series are aligned with the government’s objectives for improving access to quality agriculture seeds, clean and cheaper electricity, financial inclusion, access to social safety nets, and to other public services, especially for the poorest households, including refugees and refugee hosting communities.
“We commend the Government of Liberia for successfully completing this programmatic reform series. The benefits of the reforms implemented are already becoming visible and include among others, the reduction in electricity tariffs and the cost of importing quality-verified solar products which will benefit many households in Liberia,” said Khwima Nthara, World Bank Liberia Country Manager.
This IGDPO builds upon the gains made under the first and second operations of this program approved in 2020 and 2021. The reforms supported by this operation will strengthen the regulatory environment to incentivize private-sector participation in the agriculture seed supply chain, through seed development, multiplication and certification. The actions supported under this operation will contribute to reducing commercial losses and strengthening Liberia Electricity Corporation’s (LEC) financial sustainability, as well as increasing access to solar energy. The previous operation supported the reduction of electricity tariff for poor households from US$0.385/kWh to US$0.22/kWh in May 2021, while this new operation further reduced the tariffs to US$0.15/kWh.
“Numerous regulatory challenges that hindered the growth of digital financial services (DFS) have since been addressed by the Central Bank of Liberia (CBL), with active support from this budget support program along other World Bank Group programs, resulting in Liberia’s National Financial Inclusion Strategy (NFIS) objective of increasing access to formal financial services to 50 percent by 2024 already being exceeded in 2021,” said Mamadou Ndione, World Bank Senior Economist and Task Team Leader of the IGDPO program.
Global Recession Increasingly Likely as Cost of Living Soars
The World Economic Forum’s Community of Chief Economists expect reduced growth, stubbornly high inflation and real wages to continue falling for the remainder of 2022 and 2023, with seven out of 10 considering a global recession to be at least somewhat likely. These are the key findings of the Forum’s quarterly Chief Economists Outlook, published today.
Prospects for the global economy have deteriorated further since the May 2022 edition of this report, with expectations for growth pared back across all regions. Almost nine out of 10 of the chief economists expect growth in Europe to be weak in 2023, while moderate growth is expected in the Middle East and North Africa (MENA) region, the US, South Asia and Latin America.
The grim outlook for growth is being driven in part by high inflation, which has triggered sharp monetary tightening across many economies. With the exception of China and the MENA region, most of the chief economists surveyed expect high inflation to persist for the remainder of 2022, with expectations somewhat moderating in 2023.
The cost of living crisis bites
As the high cost of living reverberates around the world, the chief economists are in agreement that wages will fail to keep pace with surging prices in 2022 and 2023, with nine in 10 expecting real wages to decline in low-income economies during that period, alongside 80% in high-income economies. With household purchasing power weakening, the majority of the chief economists expect poverty levels across low-income countries to increase, compared with 60% in high-income countries.
“Growing inequality between and within countries is the ongoing legacy of COVID, war and uncoordinated policy action. With inflation soaring and real wages falling, the global cost of living crisis is hitting the most vulnerable hardest. As policymakers aim to control inflation while minimizing the impact on growth, they will need to ensure specific support to those who need it most. The stakes could not be higher,” says Saadia Zahidi, Managing Director at the World Economic Forum.
The cost of living crisis is driving concerns around energy and food prices. The chief economists are particularly concerned in relation to sub-Saharan Africa and the MENA region, with 100% and 63% of respondents, respectively, expecting food insecurity, with a significant number of respondents also expecting food insecurity in South Asia and Central Asia (47%, both). Most concerningly, 79% of the respondents expect rising costs to trigger social unrest in low-income countries versus 20% in high-income economies.
Debt dynamics deteriorate
The chief economists almost unanimously agree that the risk of sovereign debt default in lower-income economies is increasing. This is in contrast with high-income economies where one in four flagged debt default as an increasing factor in 2022. But as interest rates continue to rise, 42% of respondents expect debt servicing costs to exert a significant drag on growth over the next three years versus 84% for low-income economies. In this context, about one-third of respondents said that high-income countries no longer have the fiscal space to deal with another macroeconomic shock, compared with three-quarters for low-income countries.
Global fragmentation deepens
Geopolitics is expected to dominate macroeconomic and financial developments in the years ahead, according to those surveyed. Almost nine out of 10 expect heightened geopolitical risk to have a significant impact on global economic activity over the next three years, and only slightly fewer (85%) expect business strategies to be similarly affected.
A significant proportion of the respondents (69%) also expect to see geopolitical tensions affect global financial markets over the three-year horizon. Most respondents expect fragmentation to increase, especially in technology (80% of respondents) and goods (70%), with a more moderate outlook for labour (60%), services (58%) and finance (52%).
Most of the chief economists expect businesses to take decisive action in response to global developments: 80% expect businesses to adapt their supply chains to geopolitical developments. Four out of five chief economists expect businesses to pursue supply chain diversification and localization (also 80%) over the next three years, with long-term implications for costs to consumers.
Expansion of Social Protection Programs Necessary for a Resilient Recovery
Universal Social Protection is critical to effectively protect people against poverty, prevent risks to their livelihoods and well-being, and help them access economic opportunities. Achieving this goal will require social protection systems that are stronger, more resilient and better funded, according to a new World Bank report. While the pandemic, food and fuel price inflation, and longer-term challenges such as climate change make social protection critically important, they also threaten countries’ ability to raise spending and expand the social protection programs necessary for more resilient systems.
The new report, “Charting a Course Towards Universal Social Protection – Resilience, Equity, and Opportunity for All,” sets out a vision for achieving universal social protection. It underscores the need for countries to build integrated social protection systems that are underpinned by an increase in national spending to help expand social protection coverage, including to informal workers. To generate additional fiscal space, governments will need to reduce inefficient spending and mobilize more domestic revenues alongside continued international support.
“Social protection aims to promote investments in people and access to productive work, resilience to shocks and equality of opportunity,” said Mamta Murthi, World Bank Vice President for Human Development. “To reach universal social protection, governments will need to integrate services, such as social insurance, social assistance, and economic inclusion programs, ensuring all people are effectively protected throughout their lifecycle and across income levels.”
The report identifies five priorities for the World Bank to help developing countries further accelerate progress towards universal social protection. Climate change considerations and empowerment of women and girls are at the heart of these efforts. The five areas include:
- Building strong foundational social protection systems.
- Increasing coverage for social protection programs and promoting greater inclusion.
- Building more resilient, adaptive, and dynamic programming.
- Scaling up effective economic inclusion and labor systems.
- Creating more fiscal space for universal social protection.
“In response to the multiple crises facing low- and middle- income countries, the World Bank is providing unprecedented support to help governments expand and improve social protection systems,” said Michal Rutkowski, Global Director for Social Protection and Jobs at the World Bank. “This new report provides a vision towards the inclusive adoption of universal social protection to ensure that all people, including the poorest and most vulnerable populations, have the support they need and that no individuals or groups are left behind.”
Strengthening social protection systems is central to the World Bank’s mission to reduce poverty and promote shared prosperity. The COVID-19 pandemic proved to be a major catalyst for global efforts to scale up social protection systems. Between April 2020 and June 2022, the World Bank doubled its pre-COVID-19 social protection portfolio and provided more than $14 billion to 60 countries, including 16 countries affected by fragility and conflict, reaching more than one billion people worldwide. As of September 2022, the World Bank is providing $30 billion in financing to countries across regions and income levels. This includes $17 billion through IDA, the Bank’s fund for the world’s poorest countries.
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