Growth

This report builds on the OECD Well-being Framework and applies a new perspective that analyses synergies and trade-offs between climate change mitigation and broader goals such as health, education, jobs, as well as wider environmental quality and the resources needed to sustain our livelihoods through time. This report takes an explicitly political economy approach to the low-emissions transitions needed across five economic sectors (electricity, heavy industry, residential, surface transport, and agriculture) that are responsible for more than 60% of global greenhouse gas emissions. Synergies between emissions reduction and broader well-being objectives, such as reduced air pollution and improved health, increase the incentives for early mitigation action. At the same time, the impact of climate policies on issues such as the affordability of energy and jobs need to be taken into account to counter growing economic and social inequalities within and between countries. The report argues that reframing climate policies using a well-being lens is necessary for making visible such synergies and trade-offs; allowing decision-makers to increase the former and anticipate, manage and minimise the latter. This requires us to rethink societal goals in terms of well-being, reframe our measures of progress and refocus policy-making accordingly.

Although the global economy is emerging from the collapse triggered by COVID-19, the recovery is likely to be subdued, and global GDP is projected to remain well below its pre-pandemic trend for a prolonged period. Several risks cloud the outlook, including those related to the pandemic and to rapidly rising debt. The pandemic has further diminished already-weak growth prospects for the next decade. Decisive policy actions will be critical in raising the likelihood of better growth outcomes while warding off worse ones. Immediate priorities include supporting vulnerable groups and ensuring a prompt and widespread vaccination process to bring the pandemic under control. Although macroeconomic policy support will continue to be important, limited fiscal policy space amid high debt highlights the need for an ambitious reform agenda that bolsters growth prospects. To address many of these challenges, global cooperation will be key.

The current coronavirus crisis emphasises the need for the European Union to devote more effort to anticipatory governance, notably through analysis of medium- and long-term global trends, as well as structured contingency planning and the stress-testing of existing and future policies. In order to contribute to reflection on and discussion about the implications of the coronavirus pandemic for EU policy-making, this paper builds on an initial 'mapping' of some 66 potential structural risks which could confront Europe over the coming decade. Taking 33 risks which are assessed as being more significant or likely, it looks first at the capabilities which the EU and its Member States already have to address those risks, and then looks at the various gaps in policy and instruments at the Union's disposal, suggesting possible approaches to overcome them in the short and medium terms.

Whilst much commentary and analysis has understandably been focused on reaction to, and mitigation of, the immediate impact of the coronavirus crisis in Europe and worldwide, relatively little attention has been paid to areas of potential opportunity which the crisis may offer to improve policy for the future. This EPRS analysis looks at ten areas which may offer potential for progress, including working more closely together on health policy, using climate action to promote a sustainable recovery, re-thinking the world of work, future-proofing education, harnessing e-commerce and championing European values and multilateralism.

The current coronavirus crisis emphasises the need for the European Union to devote more effort to anticipatory governance, notably through analysis of medium- and long-term global trends, as well as structured contingency planning and the stress-testing of existing and future policies. In order to contribute to reflection on, and discussion about, the implications of the coronavirus pandemic for EU policy-making, this paper offers an initial ‘mapping’ of some of the potential structural risks which could confront Europe over the coming decade, with 66 such risks analysed briefly in a series of short notes. The document then goes on to take a closer look at some of the more immediate risks to be considered in the near term and outlines possible EU action to prevent or mitigate them over the remainder of the 2019-24 institutional cycle.

Social dialogue, defined as “all types of negotiation and consultation, and also the exchange of information between or among, representatives of governments, employers and workers on issues of common interest relating to economic and social policy” has been long employed as a tool in the governance of work, with the objective of delivering sustainable economic growth, social justice and the kind of high-trust work relations that are not only valuable in themselves, but that can also improve business performance and increase workers’ share in rising profitability. It includes tripartite social dialogue, collective bargaining and workplace cooperation. Collective bargaining is defined in the ILO’s Collective Bargaining Convention, 1981 (No. 154), as “all negotiations which take place between an employer, a group of employers or one or more employers’ organisations, on the one hand, and one or more workers' organisations, on the other, for: (a) determining working conditions and terms of employment; and/or (b) regulating relations between employers and workers; and/or (c) regulating relations between employer or their organisations and a workers’ organisation or workers’ organisations.” Freedom of association and the effective right to collective bargaining are the preconditions for successful social dialogue.The ILO Global Commission on the Future of Work, which examined the transformations underway in the world of work, emphasized the need for decisive action. It considered that the collective representation of workers’ and employers’ organizations through social dialogue contributes to the public good and called for public policies that promote collective representation and social dialogue. “Collective representation and social dialogue provide the institutional capabilities needed to navigate future of work transitions [....] At company level, works councils, consultation and information arrangements and worker representation on boards are all proven mechanisms to manage the challenges of change and to allow people to exercise influence over their working lives. Collective bargaining is a fundamental right and a powerful tool for economic success and social equity, not least in times of transformational change. Tripartite social dialogue allows opportunity for the partners to the social contract to consider the broader societal issues that change brings and to guide policy responses. The ILO Centenary Declaration for the Future of Work adopted by the 108th (Centenary) International Labour Conference of the ILO states that “social dialogue contributes to the overall cohesion of societies and is crucial for a well-functioning and productive economy.” Social dialogue is not only a necessary tool for managing change and addressing the transformations underway; it also helps in addressing the long-standing problems we already face. Work in the informal economy, for example, still accounts for more than 60 per cent of the world’s employed population, exceeding 90 per cent in parts of Africa and Asia. Even in the formal sector, some workers may remain trapped in jobs that offer barely subsistence-level wages and inadequate social protection in return for long hours of hard labour in dangerous conditions. In moving forward to address the challenges of the future, we also need to solve the problems we already face by strengthening social dialogue institutions and enhancing the inclusiveness of collective representation at all levels.

The start of the decade has seen a convergence of three major trends: the accelerated use of Fourth Industrial Revolution technologies in the midst of the pandemic, job market disruptions to both remote work and work requiring physical presence, and a wide-ranging call for greater inclusivity, equity and social justice. Now more than ever, in the midst of such sweeping change, organizations have an opportunity to embed greater diversity, equity and inclusion. Societal change and the need for future creativity and innovation demand that business consider the best use of new technologies in enabling this journey. Successful organizations are powered by the diverse opinions, skill sets and life experiences of their employees. To tap into the full potential of human diversity, organizations need to hire diverse talent and create an inclusive working culture underpinned by a fundamental sense of belonging, fairness and equity, enabling people to bring their “full self” to work. In the Fourth Industrial Revolution, most companies are set to implement new technologies and practices to manage their workforces. However, implementing these tools without due consideration risks a range of unintended consequences which can ultimately undermine a company’s reputation and competitive position. Today, more than ever before, new workplace technologies and practices are no longer simply “neutral” with regard to diversity, equity and inclusion outcomes. Leading companies are increasingly recognizing this and proactively leveraging technology as part of organization-wide strategies for achieving “Diversity, Equity and Inclusion 4.0”. Conversely, companies without such an integrated approach are increasingly facing unintended consequences and risks when implementing new technology tools. Recent events are a reminder of the persistent inequities that continue to pervade our societies and economies. As companies seek to take on more responsibility for addressing social justice ensuring that diversity and equality becomes the norm in the very near future, a key pathway is to adopt an integrated approach to diversity, equity and inclusion in the workplace, and a renewed commitment to tangible change. Ensuring racial justice, gender parity, disability inclusion, LGBTI equality and inclusion of all forms of human diversity needs to be the “new normal” in the workplace set to emerge from the COVID-19 crisis.This toolkit is designed to highlight the opportunities and outline the challenges specific to greater use of technology in the service of diversity, equity and inclusion efforts. It is designed for organizational leaders, Chief Diversity and Inclusion Officers (CDIOs), and others actively working to promote diverse, equitable and inclusive workplaces globally. It is intended to complement a range of related publications produced by the World Economic Forum’s Platform for Shaping the Future of the New Economy and Society: “HR4.0: Shaping People Strategies in the Fourth Industrial Revolution”, developed in collaboration with the Forum’s community of Chief Human Resources Officers (CHROs) and a guide to sound decision-making in the context of the coronavirus pandemic, “Workforce Principles for the COVID-19 Pandemic: Stakeholder Capitalism in a Time of Crisis”.