Last Monday, 2 September 2013, was the start of a new season
of BNR Newsroom, the semi-live discussion program at BNR News Radio and Ernst’s
Economy for You was again present there.
Just like last season, the weekly radio show has a
topical financial/economic subject, while the guests are renowned experts and
politicians, who deal with the subject on a daily basis. It is recorded for a
live studio audience, which is strongly invited to interact in the discussions.
Again, the program is presented by my good friend Paul van Liempt, who was yet again
in top shape during the recording session last Monday.
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| Paul van Liempt of BNR News Radio Picture copyright of: Ernst Labruyère Click to enlarge |
This week’s topic was the
Dutch labour market and the soaring youth unemployment in The Netherlands.
Among the guests were a successful Dutch entrepreneur, two members of Dutch parliament
for the PvdA-labour party and the liberal-conservative VVD, and the chairwoman
of the Dutch freelancer’s union. In the second half of the program, these
guests all spoke about the Dutch labour market and the role of the government
and special interest organizations in spurring employment in The Netherlands.
However, according to me the most important and interesting subjects
were discussed in the first half of the program, where the guests were:
- Pieter Gautier, professor in macro and labour economy at the Vrije Universiteit in Amsterdam;
- Hans de Boer, former chairman of the Task Force Youth Unemployment, which battled the Dutch youth unemployment between 2006 and 2008.
This is the reason that I only represent
the highlights of their discussion with Paul van Liempt in this article.
Nevertheless, I invite everybody who masters Dutch to click at the
aforementioned link, where the whole broadcast can be heard.
Or even better,
visit one of the coming broadcasts of BNR Newsroom on Monday, as there is
always a topic that is worth your while and with interesting guests who have really something to say about it.
Pieter Gautier
‘There are currently
9% unemployed people in The Netherlands, at least according to the Dutch
standards’.
[According to international standards, the Dutch unemployment
is 7% - EL].
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| Professor Pieter Gautier of the Vrije Universiteit Amsterdam Picture copyright of: Ernst Labruyère Click to enlarge |
‘This is a worrisome
number. If you still have a job, but receive a few percents less salary, you probably go through the crisis without a frown. However, when you are unemployed, you really feel the crisis.
I expect the unemployment to further increase a little. The
unemployment wave started quite late in The Netherlands, as a consequence of
the Part-time
Unemployment Benefit policy and the stringent Dutch labour protection’.
[Another cause for the very late increase of Dutch
unemployment was the
initial reluctancy of Dutch companies to fire personnel, as companies thought
they might need their personnel again after the crisis would be over – EL].
‘Later on, companies
realized that the crisis would last much longer than earlier expected and they started to fire people by the masses. At the same time many companies were reluctant to
hire new personnel, even if they had jobs available. The companies were too afraid
that it might be very hard to fire these people again from a legal
point-of-view, when the financial position of the company required this.
People who should
worry about their jobs, are people who do routine work, which can be automated
or robotized quite easily. These are jobs like factory-worker, secretary or
office employee with highly predictable and repeatable work. People with a flexible attitude, who
can deal with uncertainty and easily find their way in other jobs, remain
important for their companies. Hopefully, these people will not turn into ‘yes-men’
and ‘bootlickers’, as such an attitude among personnel will definitely deteriorate
the quality of their companies.
Many jobs emerged in
times, when people were virtually assured that their job would last for twenty
or thirty years in a row. Nowadays, almost nothing is left of these ‘jobs-for-life’.
For many people this has been a true transition. People need skills to handle
this uncertainty properly.
The ICT industry will be
the source of many new jobs. At companies, like Amazon and Google, the
automation and robotization of jobs continues. And also the classic doctor or
surgeon will be partially replaced by computers and robots, which already can
do a substantial part of the medical examinations and in the future much, much more. To
create these intelligent computer systems and robots, many highly-educated and skilled
technicians must be involved. Consequently, lots of new jobs will emerge in
this industry.
And there will always
be jobs, that are too hard to do for computers and robots. That can be basic
jobs, which require certain skills, but not necessarily high education. Unfortunately,
these are not the best rewarded jobs.
Hans de Boer
Paul van Liempt: ‘Nowadays,
there is 17% youth unemployment. In 2008, when the Task Force Youth
Unemployment stopped, it seemed that youth unemployment was a non-issue. What
went wrong?’
Hans: ‘To be honest:
nothing! In 2008, the unemployed youth was gone. At that moment, we didn’t see the
credit crisis come. For the whole world, it seemed like a strike of lightning’.
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| Hans de Boer - former chairman of the Task Force Youth Unemployment Picture copyright of: Ernst Labruyère Click to enlarge |
[This is always the standard reaction of people and
officials, who really didn’t see the credit crisis come and missed all the
warning signals in the years before the demise of Lehman Brothers. Regular listeners
of Kees de
Kort at BNR and regular readers of globaleconomicanalysis.blogspot.com
or www.minyanville.com
know much better – EL]
‘When we discontinued
the Task Force in 2008, we left recommendations for the government. The most important
recommendation was about ‘vocational education’. We recommended to focus upon
the intermediate-level vocational education. That is where the jobs are.
We were talking about
jobs like:
- Personal care and healthcare jobs. These jobs require people, who are good at their job, but also good in the intercourse with other people;
- Engineering and technical jobs: there are litterally hundreds of thousands of jobs in engineering.
At this very moment, the company 'IHC Shipyards' gets a massive order, which requires at least 500 extra
engineers and technicians. Unfortunately, these technicians (welders, metal sheet
workers etc.) need to be acquired in Poland and Romania, because in The
Netherlands we don’t have enough technicians with a solid, intermediate-level
education and sufficient hands-on experience.
Already in 2008, we
stated that there should be an intervention in the intermediate-level
vocational education. More people should have been educated for jobs as
technicians, engineers and healthcare professionals. Consequently, these people
would have been available for the labour market with the right set of skills.
Unfortunately, in
spite of much talking and a lot of covenants and agreements, too little
happened actually. This is The Netherlands’ major problem: yet too many people
leave school with a diploma that is worth sh*t’.
Ernst: ‘Should the 2012
government agreement not have given much more attention to the
manufacturing industry? Like what happened in countries as Austria and Germany, which seem to
be much more crisis-resilient than The Netherlands?!’
Hans: ‘It is always
the question whether writing it down in a government agreement really helps. In
the agricultural and manufacturing industry, some Dutch companies are truly
world-leaders. We should be proud about that. From the Agricultural University
in Wageningen there are dozens of spin-offs, which create massive amounts of
new jobs.
Food safety will be
THE issue of the future. Transparant food chains: this is something were The
Netherlands is traditionally strong.
Unfortunately, at a national level,
politicians and officials talk about the economy in global terms. Consequently, when real,
tangible projects emerge, these will be immediately decentralised to municipalities
and industrial sectors. That is a real shame.
Focus points in the
economy and the labour market (f.i. youth unemployment or the agricultural
industry) should be adopted by a minister, who would puts his energy in it for
the full four years of his stint. At the end of these four years, a problem has
been solved or an industrial sector has improved strongly.
However, that is not how ‘we’ –
the government and parliament - do that: a genuine Dutch disease!
We just talk about it
and deploy an execution structure, preferably without a responsibility of our
own. We lay the project down at municipalities, industrial sectors and
(independent) institutes; all parties which have very little legitimacy. In
other words: the central government is managing The Netherlands from a piece of
paper'.
Ernst: ‘Another problem
is, that there are still ample jobs available at labour-intensive industries,
but that these companies can’t get Dutch youngsters to do these often heavy and dirty jobs. I’m thinking f.i. about jobs
in the agricultural industry, the dairy industry, industrial washing/cleaning companies,
the heavy industry and manufacturing companies. How can we solve this?’
Hans: 'In The
Netherlands there is the situation that people cannot handle their own
education level anymore. Everybody needs to re-educate and train, train, train
himself and everybody wants to become manager. When you acquire a large
project for 500 new jobs, like IHC Shipyards did, you can’t find the people for
the jobs anymore.
This would be a good
subject for scientific research: what are the yields for society of all these
re-education and training programs? If there is a core of well-trained
technicians and engineers and healthcare professionals in your country, who all
received an intermediate-level education, than you have the core of your society
and economy well-organized. This is my firm opinion'.
This is something where I totally agree with Hans de Boer.
There are just too many chiefs and too few indians in The Netherlands, when it
comes to hands-on jobs in important industries, like healthcare and
manufacturing.
Nowadays, we either train people towards a management position or we scare people away from intermediate-level vocational schools, who have difficulties in learning too much theoretical knowledge, but do have very good hands-on abilities.
Instead, we should cherish these technical masters and train them the right way to get the technicians and engineers that this country needs.
And we should not forget: no country or company can be run with managers alone.
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