3.1
Why is economic security important in our current socioeconomic context?
Pursuing a broader definition of economic insecurity
Economic security comes about through the relationship a person has with the economy. This relationship does not always provide a person with the confidence that they can maintain a decent standard of living now or in the future. Moreover, a person’s experience of work and their relationship with the wider economy can create a set of trade-offs between economic security, individual health and well-being, and quality of life.
Economic security is a driving factor in tackling inequality that has far-reaching implications for people’s quality of life.
This security is threatened by the security traps that have developed because of the COVID-19 pandemic. The pandemic has created three tiers of workers: desk workers, precarious workers and essential workers. Although essential workers tend to enjoy greater job and financial security than precarious workers, working conditions during the pandemic have had a negative impact on their home lives. In this way, essential workers fall prey to a security trap, meaning there is a trade-off between economic life, family life and individual well-being. This calls for a set of policies to guarantee both economic security and people’s broader well-being.
To what degree a sense of uncertainty drives a person’s experience of insecurity is unknown. Changes in the world of work are happening rapidly and many are left to their own devices to manage these changes. There may be a need for workers to learn new skills, yet the support to do so is often lacking.
Since most people depend on their jobs for economic security, this need for upskilling should be addressed in efforts to improve people’s economic security.
Essential workers fall prey to a security trap.
There may be a need for workers to learn new skills, yet the support to do so is often lacking.
"Precarious forms of employment are characterized by alternative working patterns, temporary forms of contractual relationships, alternative places of work, and irregular working hours”.UN DESA Policy Brief 113.
Singapore is leading policy innovation that blends economic needs with individual skills needs. It has built future scenarios and identified the skills that are necessary for these scenarios, locking what it has learned into the system of how people engage in learning and at work. The country has embarked on a public campaign around future skills, promoting learning as essential for its economic future and people’s self-worth. It also provides cash benefits as an incentive for people to enroll in skills-building programmes. As a result, the country has witnessed a huge increase in adult learning.
Photo/William Cho
3.2
Countries and people face different challenges when it comes to ensuring better economic security.
How can governments implement policies that are effective for everyone?
Context matters
Governments could mandate workplace regulations or minimum wages, but they tend to be all-purpose general rules.
To be effective, efforts to promote economic security need to be tailored for specific contexts and take into account location and industry. A fine-tuned approach can ensure that workers have a say in things like innovation and technology being introduced into the labour market.
Evidence from Africa indicates that large companies are more productive than smaller ones but struggle to hold on to their workforce and make up a relatively small share of total employment. If technology and industrialization are to solidify this trend in the future, this potentially paves the way for governments to tax companies and generate resources for skills training and social protection programmes to support those in need. Socioeconomic policies to promote economic security in this context also need to provide support to workers who derive their livelihoods from employment in small firms and from informal work.
To avoid social and employment crises, governments must find a way to provide universal social protection. Basic income schemes are one way to alleviate poverty, but there are trade-offs with fiscal costs and concerns about behavioural impacts. Basic income grants must be linked to wider efforts to improve access to work, particularly in countries with high unemployment and informal employment.
Countries need a fair and adequate social security system to improve economic security and address increasing uncertainty in the labour market. This must be considered within the broader context of public services and infrastructure that have dwindled in recent decades.
To avoid social and employment crises, governments must find a way to provide universal social protection.
3.3
With the nature of work constantly changing, how can workers guarantee their economic security in the current and future environment?
Giving workers a voice in the future of work and social protection
Economic security is a multifaceted problem for which employers and civil society have a role to play in finding solutions. Government policy alone is not enough to bring about economic security in a changing world of work. The nature of work will be very different in the future, and there will be obstacles for many workers. Large companies were once the agent of the welfare state, providing social insurance through pensions and health care, but that model is gone.
A transition to more secure work should be pursued through increasing the voice and agency of workers.
World Bank Photo/Curt Carnemark
Given current trends in the labour market, the traditional labour union movement has limitations in securing workers’ rights and benefits. It will be up to new institutions and new organizations to give workers a voice in the future of work and social protection.
Innovation in ways to improve people’s economic security has gained momentum in the civil society sphere.
For example, metalworkers in Germany have mobilized gig workers, reinforced by a code of conduct among platforms regarding how workers are treated.
In Belgium, SMART, a cooperative for freelancers, creatives and artists, has pooled resources to establish sustainable working conditions for all.
In the United Kingdom, the Independent Workers of Great Britain (IWGB), a fully independent trade union and the UK’s leading union for precarious workers, has taken on corporates such as Deliveroo and Uber to secure workers’ rights and decent pay and conditions.
