Strong labour relations key to reducing inequality and meeting challenges of a changing world of work - OECD & ILO

Globalisation and rapid technological innovation have spurred unprecedented economic growth but not everyone has benefited. Unions and employers, together with governments, can play a major role in making growth more inclusive and helping workers and businesses face the challenges of a changing world of work. Good labour relations are a way to reduce inequalities in jobs and wages and better share prosperity, according to a new OECD-ILO report.

Building Trust in a Changing World of Work finds that trade union membership is declining in a majority of countries, while in several emerging economies large shares of the workforce are still in the informal economy. The share of employees whose job conditions and pay are regulated by collective bargaining varies greatly across sectors and countries, from less than 10% in Turkey to over 90% in Sweden. Coverage of collective bargaining have also seen a marked decline in many countries over the last decades, although in some countries more workers are covered today thanks to decisive policy reforms.

Creating more and better jobs is key to achieving inclusive economic growth. At a time marked by increasing job insecurity, wage stagnation and new challenges from the digital revolution, constructive labour relations are more important than ever, said OECD Secretary-General Angel Gurr, launching the report alongside Swedish Foreign Affairs Minister Margot Wallstr, French Labour Minister Muriel Picaud, ITUC General Secretary Sharan Burrow and ILO Deputy Director-General for Field Operations & Partnerships, Moussa Oumarou.

The report is part of the Global Deal for Decent Work and Inclusive Growth, an initiative launched in 2016 by the Swedish Prime Minister Stefan Lven and developed in cooperation with the OECD and the ILO. This multi-stakeholder partnership aims to foster social dialogue as a way of promoting better-quality jobs, fairer working conditions and helping spread the benefits of globalisation, in keeping with the Sustainable Development Goals. The Global Deal has around 90 partners representing governments, businesses, employers' and workers' organisations and other bodies who make voluntary commitments to contribute to a more effective dialogue and negotiated agreements on labour issues.

We are convinced that the Global Deal for Decent Work and Inclusive Growth can help to spur more and better social dialogue so we can provide all workers with strong voices, protection, fair working conditions and good levels of trust with employers, Mr Gurr said.

The new report shows that enhanced social dialogue can create opportunities for more inclusive labour markets and economic growth, better socio-economic outcomes and greater well-being for workers, improved performance for businesses and restored trust for governments, said ILO Director-General Guy Ryder.

Some 2 billion workers around the world - more than half the global labour force - are in informal and mostly insecure jobs, according to the report, meaning they do not have formal contracts or social security. Annually there are 2.78 million work-related deaths and 374 million non-lethal work-related injuries and illnesses.

The report highlights the crucial role that unions and employers can play in shaping the future of work by jointly deciding what technologies to adopt and how, contributing to manage transitions for displaced workers, helping identify skills needs and developing education and training programs. The report also shows that when looking at the OECD Guidelines for Multinational Enterprises companies with a higher social score (a measure of their capacity to generate trust and loyalty among the workforce, customers and wider society) also have a stronger financial performance.

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