17. National Employment Policies

Sustainable Development

Decent work

Economy Social Environment Employment Protection Rights Dialogue
Relevant SDG Targets
8.3, 8.5, 8.6 1, 10, 16, 17
Relevant Policy Outcomes
1, 6

On this page: DWA-SDG Relationship | Cross-cutting policy drivers | Partnerships | ILO Capacity | Resources

The ILO estimates that more than 600 million new jobs will need to be created over the next decade to generate sustainable growth and maintain social cohesion. Global employment challenges have become increasingly pronounced since the financial and economic crisis in 2008. This crisis both revealed and further aggravated glaring employment deficits in terms of both levels and quality, and highlighted the need to address structural imbalances in labour markets. The global employment gap, measuring the number of jobs lost since the start of the crisis, had reached 61 million by 2015 and continues to widen. Coupled with this, in 2015, there were over 200 million unemployed people worldwide, while over half of the world’s workers were involuntarily self-employed. In developing countries, burgeoning informal economies account for between 35 and 90 per cent of total employment. Working poverty remains pervasive, and non-standard, precarious forms of employment have seen an alarming rise. These challenges tend to disproportionately affect women, youth and marginalized groups, requiring integrated and far reaching policy responses. It is now commonly acknowledged that economic growth, while necessary, is by no means sufficient to engender sustainable and productive employment. At the same time, a lack of productive employment opportunities and the persistence of decent work deficits will impede pro-poor growth and sustainable development (53) . National employment policies (NEP) pursue the overarching objective of converting economic growth into employment growth. At national level, a coherent, integrated and well-designed employment policy, which cuts across the macro- and microeconomic dimensions and addresses both labour demand and supply, is of utmost importance to tackle employment related problems.

The objective of full, productive, and freely chosen employment was already stated in the ILO Constitution and the 1944 Philadelphia Declaration, with the Employment Policy Convention, 1964 (No. 122) further articulating it. In addition, all ILO work on employment derives its current mandate from the Global Employment Agenda (2003), the ILO Declaration on Social Justice for a Fair Globalization (2008) and the Conclusions of the Recurrent Item discussion on Employment. National employment policies seek to explicitly link growth and economic strategies to employment creation, and diagnose the challenges and opportunities for productive job creation (54) .

The ILO promotes a comprehensive approach to employment policy, whereby a NEP should elaborate both a vision and a concerted and coherent framework linking all employment policy interventions, as well as all stakeholders – government, workers’ and employers' organizations, financial institutions, industry and other civil society groups – who have a role to play in reaching employment targets37. The content of a NEP will necessarily touch upon a wide array of economic, social and labour market policies that affect both the supply and demand sides of the labour market, as well as the intermediation between them. The NEP can therefore serve as an umbrella for complementary policies, as illustrated below:


Consequently, national employment policies are closely related to several thematic areas discussed in this guide, most prominently to the active labour market policies, to employment-rich economic growth, to working conditions, to the informal economy, to youth employment, and to equality.

The ILO facilitates comprehensive employment policy processes at the country level through:
  • conducting sex and age disaggregated employment and labour market situation analyses;
  • providing research and analysis on how to increase the employment content of growth to inform policy design, monitoring and evaluation;
  • offering policy advice on incorporating employment goals in overarching policy frameworks; and
  • undertaking capacity building for government and the social partners; as well as facilitating tripartite policy dialogue.
The issue of national employment policies is addressed by several International Labour Standards, chiefly by the Employment Policy Convention, 1964, (No.122) ratified by 109 countries, and the associated Recommendations R.122 and R.169. C.122 provides the global normative reference for employment policy. It calls upon States to declare and pursue an active policy designed to promote full and productive employment as a major goal, consulting the social partners and taking into account national circumstances.

The ILC has also adopted a wide range of additional instruments to guide advocacy and technical work in relevant fields such as skills (e.g., C.142), employment services (C.88), private employment agencies (C.181), the employment of persons with disabilities and other vulnerable groups (e.g., C.159), transition from the informal to the formal economy (R.204), enterprise development (e.g., R.189), and social protection floors (R.202), amongst others.

DWA-SDG Relationship

The formulation of national employment policies is central to the achievement of SDG 8, in particular its targets 8.3, 8.5 and 8.6. Moreover, since employment creation can be considered as the mechanism that translates growth into poverty reduction, NEPs are of great relevance to the fight against poverty (SDG 1) and inequality (SDG 10) but they can only be effective if they respond to local needs. Consensus needs to be built through extensive dialogue and transparent and accountable decision-making processes at all levels to develop legitimate employment policy measures and strategies; these issues are addressed by SDG 16, namely targets 16.6 and 16.7. The complexity of labour markets requires coordination and policy coherence. Analysing several policy areas, such as skills development, sustainable enterprise development, sectoral development policies, and macroeconomic policies simultaneously fosters a more coherent targeting of the challenges. Tripartite inter-ministerial coordination mechanisms ensure coordinated support towards comprehensible interventions aligned with national development frameworks and key stakeholders’ concerns and priorities. NEPs therefore contribute to policy coherence (SDG target 17.14) and national ownership (17.15).

The formulation and implementation of NEPs is captured under ILO policy outcome 1, but it is of relevance to all other policy outcomes as well. In fact, the comprehensive nature of NEPs means that those policies must take into account the concerns and priorities addressed by these outcomes.

Cross-cutting policy drivers

The formulation and implementation of NEPs can be seen as one of the most effective means to promote the application of international labour standards at the national level. In the same vein, integration of gender equality and non-discrimination issues are critical to ensure that NEPs create a conducive policy environment for enhancing full, productive and freely chosen employment for all women and men, in particular, young people. NEPs are the product of a comprehensive and intense process of tripartite social dialogue, which in turn means that the formulation of NEPs can effectively contribute to the strengthening of national tripartite social dialogue institutions and mechanisms.

The aspect of environmental sustainability must be taken into account when formulating NEPs; on the other hand, NEPs can become an effective tool to promote the greening of national economies as well as the creation of “green jobs”.

Partnerships

Institutional arrangements in the development and implementation of a NEP matter greatly, although they may differ substantially from one country to another, depending on specific country contexts. Whatever arrangements are put in place (e.g., technical, drafting, steering committees), it is of paramount importance that the development of national employment policies include a wide range of interested parties to ensure policy coherence, ownership and sustainability. This approach is very much in line with SDG 17, which calls for policy coherence and coordination (53). The specific area of NEP therefore requires the establishment of partnerships at the national level. In addition, they can benefit greatly from partnerships with other organizations, such as the UN system, the World Bank, the IMF, and the donor community. The effective implementation of the employment-related goals and targets of the 2030 Agenda requires even greater partnerships and cooperation with the UN system, international financial institutions, regional institutions, development banks and sub-regional economic communities. The Global Initiative on Decent Jobs for Youth provides a good example of such a UN system-wide partnership.

ILO Capacity

The ILO Employment Policy Department’s Employment and Labour Market Policies Branch (EMPLOYMENT/EMPLAB), in close coordination with the global team of field employment specialists, provides policy advice, develops methodological tools, builds capacities of key actors and supports government and social partners in the development and implementation of NEPs. The Branch and its field specialists have the primary responsibility for the organization of integrated country employment policy diagnostics and reviews, facilitation of tripartite policy dialogue on employment policy and policy development and implementation. This includes work on pro-employment macro-economic and budgeting frameworks, national employment monitoring indicators, labour market policies including activation and intermediation, employment services and youth employment, as well as integrating gender equality and non-discrimination concerns in all the work thereof.

Resources

A collection of resources related to national employment policy can be accessed through the web page of the Employment and Labour Market Policies Branch (EMPLAB). Additional material is available at the web site of the employment and labour market policies unit of the ITC Turin.


37 - “The National Employment Policy (NEP) is an official framework manifested in an operational document that refers to a set of multidimensional interventions adopted on the basis of a common agreement reached by all interested parties and pursued by a government in order to address clearly identified challenges and opportunities and achieve specific quantitative and qualitative employment objectives. It includes a course of action, selected among alternatives and in light of given conditions.”(79)

53. ILO. SDG Note - National Employment Policies. Geneva : ILO Employment Policy Department, 2016.

54. —. Employment for Social Justice and a Fair Globalization, Overview of ILO programmes - Employment Policies. Geneva : ILO, 2012.

79. —. Guide for the formulation of national employment policies. Geneva : ILO, 2012.