Labor Market Reform and Job Creation. The Unfinished Agenda in Latin American and Caribbean Countries

Description

This book was written to encourage a call for comprehensive labor market reforms—part of the unfinished agenda that is sometimes called the ''second generation of reforms.'' These reforms are difficult: workers worry that their jobs may be put into jeopardy and, especially in economies where safety nets are inadequate, these concerns are real. Successful labor market reforms must thus be complemented with strengthening of the safety nets and—perhaps most importantly—with macroeconomic policies that sustain robust growth, particularly in the sectors that are likely to give rise to substantial job creation. The kinds of economic policies that some countries have pursued, especially in response to the financial crises of recent years, have led to economic contractions that contribute to a self-defeating and vicious cycle. Without growth, workers are unwilling to accept reforms that have a high risk of condemning them to extended periods of unemployment. But without the reforms, it is hard to generate high growth. Thus, meaningful work on the second generation of reforms— including reforms in the labor market—can only move forward aggressively in an economic climate in which governments commit themselves to sustained expansionary policies, and in which governments demonstrate a sensitivity to the real concerns of the working people. An ambitious agenda lies ahead, but the rewards of pursuing this agenda, with commitment and compassion, will be worth all the efforts devoted to it. We hope that the insights provided by this thoughtful and timely volume by Professor Guasch will provide both encouragement and understanding as countries embark upon these challenges upon which so much of their economic future depends.