Reading
the headlines one can hardly avoid the alarming unemployment figures being
published in various newspapers and magazines. A recent article on Spiegel
Online entitled Europe's
Hollow Efforts to Save a Lost Generation gives latest figures and suggests a lost
generation in making. It is scary to read about people not getting
opportunities to develop a future for them and for the society to a larger
extent. Unemployment problem needs both short-term and long-term remedies for
its eradication. Generally short-term views are championed by politicians so
here I discuss a long-term view to identify a Companies, Anonymous-individuals,
Governments and Educational-institutions (CAGE) based ecosystem that should act in tandem to minimize the menace of
unemployment.
Companies
There are two contradicting stories brewing in
parallel, on one side are highly skilled workers protesting against lack of
opportunities and on the other companies complaining about inadequate labor
force in the marketplace to fulfill the business needs. Lots of studies have
indicated that positions remain vacant in companies in search for the right
candidate and this problem can be more severe in countries where strict labor
laws make it impossible for employee to be moved once hired. Companies should
have a direct interest in lowering unemployment problem as it has an influence
on social stability which any business desires for future prospects. Most of
the companies do run management trainee positions for a limited number of
people to be trained for specialized business needs. This seems to be an
effective solution to take more people on board and bridge the general knowledge
gap complained by the companies. Most of the companies also have Corporate
Social Responsibly (CSR) departments assigned the task of contributing back to
the societies in which the companies operate. CSR department should also have a
mandate to contribute in training future employees of the company maybe in
collaboration with the educational establishments. A situation where engineers
from GE, Google, BMW interact with students can have a game changing effect on
this entire knowledge gap which lot of companies seem to complain about. In the
corporate world most of the jobs are filled through networking so by the same
logic if company employees were to interact much more with the external world
(i.e. prospective employees) the unemployment problem can be tackled in a
productive manner.
Anonymous-individuals
Every individual irrespective of nationality, social
status and personal conditions has an important role of being her own Chief
Life Officer (CLO). CLOs share the same level of individual responsibility as a
CEO of company with the difference being the missing million dollar paycheck. As
a honest CEO shall not participate in any blame-game CLOs should make it a
matter of principle of not to even think about it. This resolve is tough
considering the situation around a CLO is mostly not his/her control. Wise men
say World is Not Fair but I add to it “it never was and will never be”. It is a nice temptation for us to complain
about existing bad economic conditions and greedy bankers. However we have to keep
in mind that we have had a fair share of luck as we are fortunate
to be living in an era without wars or rampant epidemics (just an example). For
a moment, if we look back, all CLOs of world-war era didn’t want war but it was
decided by factors out of their control. Comparing the situation, we are
definitely well-off with our protest and anger being aired on television and
reported all around the world. Protests are an indispensable form or any
democratic system so I definitely have nothing against them. However, CLOs should remind themselves that as
collective responsibility is no responsibility the probability of a mass anger
and demonstration doing good to an individual is low. Our motto should be, My
Destiny is My Action.
Governments
Irrespective of different fallacies in a democratic
system, government has to bear the burden and the responsibly of unemployment.
Irrespective of the same democratic electoral system, role of the government in
solving unemployment problem is seen differently in different countries. In
Europe, youth unemployment is making news and leading to protests on almost a
daily basis but a similar situation is an accepted reality in countries like India. I
strongly feel a government cannot be in the business of generating employment
for a very long time. Role of the government is to facilitate conditions
generating employment but not generate employment itself. The effectiveness of
those generated conditions would again depend upo+n various factors mentioned
in this post. Already there are some effective policies in place in various
countries like, tax breaks for companies hiring young inexperienced workers
(France), grants for forming new companies (Germany), tax breaks for
individuals enhancing personal professional skills, supporting efficient
education system, ensuring companies to play by the rules etc. Referring to recent Apple tax evasion fiasco,
governments should make favorable rules for companies to invest and hire more
people rather than parking earned profits in overseas territories to avoid
taxation. Governments also need to acknowledge that coming up with any taxation
on companies to suck their profits would not work in the long term because
practically unlimited resources in the private sector would find loopholes sooner
or later. Also any realistic government policy can have only a long term impact
and this has to be understood. I shall be very skeptical of any political
leader claiming to solve the unemployment problem after election results which
his predecessor couldn’t. The dip in popularity ratings of the French president
François Hollande for not being able to solve the unemployment problem
shouldn’t surprise anybody following the basic macroeconomic indicators.
Educational-institutions
Education system around the world needs to be tuned to
the modern needs and challenges. Attitude towards Education and Training could
have a major role in transforming right skills to desired skills. Though the
spirit and risk taking attitude of entrepreneurship cannot be taught in class
rooms but the steps to form a company (for example) should be inculcated into
the curriculum as early as possible. Most of the traditional schooling and
university systems have KPIs (Key Performance Indicators) which are suited to
times where good grades and degree were a guarantee to jobs in big
corporations. As we realize in recent times that have changed as good grades
plus a long list of “nice to haves” is the new demand. CLOs need to be engaged
at an early age and projects generally limited to doing scientific models, data
analysis should also be extended to developing a business plan, understanding
legal structures, founding a small entity and raising capital for small joint
ventures. As of now these subjects are left to MBA curriculum assuming most
Engineers, Biologists, and Social Scientists etc. have nothing to do with it.
Except very few talented section of the society who resort to obtaining dual
degrees or learning out-of-interest most of the labor market is just too
specialized to think of something else in case they fail to find a job in the
trade they were trained for. The repercussion is seen in huge salaries an MBA
graduate expects to command just by learning some basics of running business
and solving case studies with the comfort of hind-sight and no impact of
failure. The worst outcome of an imbalanced education and salary structures is
the trend where our best and brightest are preparing for business schools
rather than innovating to drive growth and employment. We as a society for too
long can’t support a system where our future Newton, Galileos have a MBA from Harvard and
they aspire to manipulate Excel sheets in a Goldman Sachs office. The
“sophisticated” products from the recent financial crisis like the mortgage
bagged securities, naked credit default swaps are simply an end-product of
brilliant minds producing toxic weapons of mass destruction. Empty mind is
devil’s workshop. Further, the imbalance created by educational upbringing producing
customers buying dangerous products is just the icing on the cake. In short,
minimum business and financial literacy for the entire population is a must.
In general a complete CAGE ecosystem needs a revamp to
solve the problem in hand. This blog post has discussed some ideas which might
only show some improvement in the long term but the short term problem is the
real concern. May be the American way of keep pumping money to bring down the
employment rate and not hoping to pay the debt works but I am doubtful. For
individuals, CLOs blaming greedy bankers, politicians for their plight
need to turn some pages in history to find that throughout the human existence
there was always a class of people privileged or selfish enough to not to be bothered
about others. I am not a pessimist but I don’t see this societal characteristic
disappearing completely. Broad ideas
here suggest a new Modes Operandi is need of the hour but I know its “Easier
Written than Done”.
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