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Theory & Strategies for Full Employment. Proceedings of the World Academy of Art & Science Conference on the Global Employment Challenge

1. The Need for New Theory and Strategies

From October 2009 to March 2010, the World Academy of Art & Science launched an e-conference on the Global Employment Challenge (GEC). The conference included video webcast presentations and formal papers by innovative thinkers combined with open discussion between Fellows of the Academy and invited guests. The GEC documented the dire need for new thinking and action to address the pressing problem of unemployment in the world today. The recent international financial crisis has thrown into stark relief serious deficiencies with prevailing theories that advocate macro-economic stimulus as the principal policy instrument available for creating new jobs. Applying conventional economic analysis, policies and public programs, the leading economies of the world have expended a few trillion dollars over the past year to offset the economic impact of financial collapse and stimulate employment generation through economic growth.
In spite of this unprecedented expenditure, today a record high 212 million people are without jobs globally, according to official ILO figures.1 This figure grossly underestimates actual unemployment and underemployment worldwide, which leaves more than three billion people living on incomes of less than $2.50 a day and unable to meet even their minimum economic needs. Even in economically advanced nations, huge numbers of people — most especially youth — are unable to find remunerative employment. According to webcast presenter Randall Wray, the actual level of unemployment and underemployment in the USA is approximately 17.5% of the work force, representing some 25 million people.2 He foresaw nearly a year ago what has become much more apparent since then; namely, that it may take 5 to 10 years before unemployment levels in the USA return to pre-crisis levels. Similar conditions persist in most OECD countries. Real unemployment rates in many countries are at least twice the official figures, which do not account for those who have given up seeking work.
The financial crisis has aggravated the global employment problem, but the problem itself precedes and will persist long after the world economy recovers from the recent downturn. Even before the onset of the crisis, levels of unemployment were unconscionably high in many countries. In 2005, unemployment was 18% in Spain, Poland and East Germany, more than 15% in Croatia and Slovakia, and 30% to 95% throughout most of Africa. Especially troubling is the high youth unemployment rate, e.g. around 35% in Poland, Croatia and Slovakia, 30% in Italy and Greece, 20-25% in France and Spain. The reliance on massive public expenditure to stimulate job creation has not only proven inadequate, but also threatened the financial stability of countries such as Greece, Spain and Portugal who thought they could afford it.
In spite of these bleak figures, the presentations and discussions that have taken place during the GEC indicate that long term trends support the view that full employment is an achievable goal and that other strategies do exist that are capable of generating full employment nationally and globally.3 In order to generate the confidence needed for widespread adoption, these alternative approaches require the support of theoretical backing and practical evidence. The GEC called for the formulation of new research to identify and document alternative approaches backed by valid theory for achieving the goal of full employment.

2. Necessity of Full Employment

One of the central themes that emerged from the GEC is the necessity of recognizing employment as a fundamental human right and the responsibility of governments to take all possible steps to achieve and maintain full employment. The right to employment is supported both by idealistic as well as practical considerations. In a world in which individual citizens are expected to provide for their own economic livelihood and that of their families, access to employment is an absolute necessity for physical survival and human welfare. Economy is a social organization created by human beings to meet human needs and human welfare. Any theory which purports to represent sound economics must provide a viable means for all members of society to acquire at least the minimum (why not the optimum?) level of purchasing power needed for survival, development and full enjoyment of their human potential. If economic systems based on current theory are unable to provide sufficient employment opportunities, it means either the prevailing theory or its application is deficient.
A few centuries ago that vast majority of the world’s population lived on the land and eked out a subsistence level existence from their own physical labor. This is no longer the case. As Winston Nagan observed in his paper, society has become so structured and economy so specialized that today the vast majority of human beings are dependent on employment outside the home for their survival and welfare.4 Government policies, laws and regulations permeate virtually every aspect of modern economic and social life, effectively determining what types of activity can and cannot be carried out and thereby directly or indirectly determining the number and type of employment opportunities available to the population. Principles of justice necessitate that a government which interferes with economic activity in order to protect the rights of some must ensure conditions that support the basic economic rights of all its citizens. Guaranteeing the right to employment is not only just and necessary; it is also the only effective way to ensure that employment opportunities are available to all citizens. A firm commitment of governments to uphold this right will generate the political will required to achieve it.


Ashok Natarajan, GEC Conference Co-chair; Secretary, The Mother’s Service Society, India
1 ILO, Global Employment Trends 2010.
2 Wray, Randall, “Full Employment Through Direct Job Creation”, webcast presentation to the World Academy of Art & Science, November 10, 2009, http://www.worldacademy.org/files/Job%20Guarantee%20Wray%20presentation%20on%20Nov%2010%2009.pdf
3 Jacobs, Garry, “The Global Job Machine: Trends & Prospects”, the World Academy of Art & Science e-conference on Global Employment Challenge, November 2, 2009, http://www.worldacademy.org/forum/global-job-machine
4 Nagan, Winston, “Human Rights and Employment”, the World Academy of Art & Science e-conference on Global Employment Challenge, October 1, 2009, http://www.worldacademy.org/forum/human-rights-and-employment-winston-nagan


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