Increases in public service employment “should be central to our strategy for full employment,” according to social protection minister Joan Burton. Speaking at a major ICTU conference last week, minister Burton also argued that the state should in future act as the “employer of last resort,” guaranteeing a job for everyone who wants to work in good times and bad.
She said the state should offer a job guarantee to all workers, including through direct job creation, to secure “real” full employment. “A job guarantee would ultimately secure real full employment at every stage of the economic cycle by making the state the employer of last resort, guaranteeing employment and training opportunities for unemployed people,” she said. A fixed wage for job guarantee positions “would serve as the effective basic living wage in the economy,” she said.
If the idea were adopted, future recessions would see workers in active employment and training rather than mass unemployment. “Private employers would then be prepared to hire them once the economy recovered,” she said.
Speaking at the conference, called ‘a new course for better times,’ the leader of the German trade union confederation DGB, argued for a job-creating European investment fund worth 2% of European GDP. Reiner Hoffmann said this could be funded through a small financial transaction tax – which is already supported by 12 EU countries including Germany and France – and a once-off tax on rich individuals.
Reiner said the fund should be controlled by the European Parliament rather than unaccountable bodies like the troika. If properly invested, he said such a fund could create 11 million new jobs and generate up to €104 billion in tax revenues, €20 billion of savings on social security and a €300 billion reduction in Europe’s fossil fuel imports.
NUI Maynooth economist Séan Ó Riain told delegates that a more egalitarian economy could also be more efficient, so long as there was sufficient investment. The most consistently successful European economies had higher – but strongly controlled – public spending and “invested more in every aspect of their societies,” including social, business and educational investment. They also had higher levels of union membership and collective bargaining rights.
Professor Ó Riain said that, in any future social partnership arrangement, unions should trade wage restraint for public service investment rather than tax cuts. And employers should be required to deliver genuine investment.
