rodrik155_Robert NickelsbergGetty Images_worker Robert Nickelsberg/Getty Images

The Good Jobs Challenge

Every economy in the world today is divided between an advanced segment, typically globally integrated, employing a minority of the labor force, and a low-productivity segment that absorbs the bulk of the workforce, often at low wages and under poor conditions. How should policymakers address this dualism?

CAMBRIDGE – Around the world today, the central challenge for achieving inclusive economic prosperity is the creation of sufficient numbers of “good jobs.” Without productive and dependable employment for the vast majority of a country’s workforce, economic growth either remains elusive, or its benefits end up concentrated among a tiny minority. The scarcity of good jobs also undermines trust in political elites, adding fuel to the authoritarian, nativist backlash affecting many countries today.

The definition of a good job obviously depends on a country’s level of economic development. It is typically a stable formal-sector position that comes with core labor protections such as safe working conditions, collective bargaining rights, and regulations against arbitrary dismissal. It enables at least a middle-class lifestyle, by that country’s standards, with enough income for housing, food, transportation, education, and other family expenses, as well as some saving.

There is much that individual enterprises all over the world can do to improve employment conditions. Large firms that treat their employees better – by providing them with higher pay, more autonomy, and greater responsibility – often reap benefits in the form of lower turnover, better worker morale, and higher productivity. As MIT’s Zeynep Ton has long argued, “good jobs” strategies can be as profitable to firms as they are to workers.