Global imbalances,crisis and the lack of global governance

Gross domestic product

Vast disparities in per capital income levels continue to exist around the world. The catching-up process of the developing world, which has broadened since 2003, received a boost since the global crisis as key developed countries have struggled to recover from it. These post-crisis developments are not fully benign, since the hesitant and fragile recovery in developed countries risks holding back or even undermining income growth in developing countries. The fast shifting balance in the world economy is reflected in the decline in the share of developed countries in global gross domestic product (GDP).

Employment and unemployment

Widespread unemployment and underemployment in the global economy continues to present the most pressing social and economic problem of our time. The situation was made worse by the global crisis. While many developing countries merely suffered a temporary deterioration, the lasting labour market impact in major developed countries poses fresh challenges and risks to the continuation of positive runs in job creation and poverty reduction in the developing world. Ill-guided policies directed at the labour-market legacies of the crisis in developed countries risk global spillovers that could destabilize developing countries.

Current and account Imbalances 

Large current account balances have been at the centre of long-standing international economic policy debates regarding global imbalances. The United States has run persistent current account deficits since the early 1990s, with net private capital inflows as well as official inflows (i.e. international reserve accumulation by other countries) as the counterpart. A small and only partly evolving group of developed and developing countries features prominently on the surplus side of global imbalances. Current account imbalances may arise for a number of reasons and are not indicative per se of a systemic problem that needs coordinated intervention. Rather, it is the loss of competitiveness at the national level that causes an unsustainable current account deficit.

Misaligned exchange rate

Countries’ competitiveness positions are primarily shaped by trends in unit-labour costs and exchange rates. Since the end of the multilateral Bretton Woods exchange rate system, non-orderly floating of currencies has prevailed, featuring large exchange rate swings and persistent misalignments. Current account imbalances caused by unbalanced competitiveness positions matter both at the regional and global levels. Unbalanced competitiveness positions are the underlying cause of the ongoing European crisis. In general, exchange rate movements that are persistently inconsistent with achieving balanced global competitiveness positions provide strong evidence for the need to coordinate global currency markets.

Interest rates, volatile capital flows and exchange rate instability

Traditional theory holds that floating exchange rates insulate countries against external shocks and enlarge national policy space. Driven by stabilizing currency market speculation, movements in nominal exchange rates are held to compensate for inflation and/or interest rate differentials, so as to avoid any build-up of unbalanced competitiveness and trade positions. Actual experiences speak another language altogether. In the absence of proper global governance, global finance has become dominated by herd-like short-term risk-reward calculations that may ignore the gradual build-up of economic imbalances and related financial fragilities for a long time. The authorities of target currencies in the developing world are facing difficult choices.

Financial liberalization and the financialization of commodity markets

Sizeable commodity price volatility can have adverse effects at both the macroeconomic and microeconomic levels. The wide price fluctuations observed over the last decade coincided with major shifts in commodity market fundamentals, as well as with increased trading by financial investors in commodity derivatives markets. The financialization of commodity markets has accelerated significantly since about 2002–2004 and most probably reduced the reliability of price signals emanating from commodity futures exchanges. Greater market transparency and tighter regulatory measures are called for to contain the price impact of financial investors and the associated risk of price bubbles.

Global rebalancing and recovery contributions

After briefly shrinking during the global crisis, global imbalances in trade and financial flows have made a comeback during the recovery and remain large as of today. While the balances of the main surplus and deficit countries or regions are below their pre-crisis peak, there has been no fundamental change in the global imbalance constellation. Developing countries at large have contributed disproportionately to global rebalancing and recovery, while an increasing number of them have reached the point where rising current account deficits signal future risks of fragility and crisis.

Source: United Nations conference on Trade and Development 2012

Global imbalances,crisis and the lack of global governance

Employment and Unemployment

Work represents – for the majority of the population – the main source of personal income, the other sources being the revenues from capital and social transfers. For working-age populations, employment is also essential for social inclusion. As productivity growth and structural change, featuring job destruction, are inherent aspects of development, the timely creation of jobs in sufficient numbers is a permanent challenge. Job creation is of even more vital importance when population growth in conjunction with demographic and social factors yield a growing labour force ready for employment – or at risk of raising the reserve of unemployed or underemployed workers. Widespread unemployment and underemployment in the global economy continues to present the most pressing social and economic problem of our time because it is closely related to poverty, on the one hand, and social peace and political stability on the other.

 

Growth of employment and real gross domestic product in developed economies, 1971–2011
(Percentage)

Source: UNCTAD, TDR 2011 (Table 1.1) andTDR 2010 (Chart 3.3) March 2012 update;UNCTADstat database and Historical Statistics of Japan, Statistical Bureau

Note: Developed countries comprise: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Israel, Italy, Japan, Luxembourg, the Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, the United Kingdom and the United States.

In developed economies, there is a strong link between GDPgrowth and employment creation. By contrast, in developing economies, changes in informal employment and self-employment dampen the effects of growth cycles on formal employment  (Chart). In the absence of social safety nets fulfilling this role in developed economies, in developing economies movements into and out of informal, low-quality employment is typically cushioning employment in the formal economy as captured in official statistics, if at all. The segmentation of the labour structure in developing countries reflects the dualism that characterizes their economic structures: The coexistence of a modern sector with relatively high productivity and a sluggish traditional sector with low productivity. Moreover, the segmentation also highlights the importance of the quality of employment created; above and beyond the sheer quantity of, perhaps, precarious and poorly paid jobs feeding the ranks of the working poor. While unemployment rates always have to be assessed in conjunction with labour force and employment data in both developed and developing countries. Classification of workers by employment status underlines that the self-employed and contributing family members continue to play a far more prominent role in developing countries (Table).

 

Real gross domestic product and employment by region, 2003–2011 (Annual average growth rate)
Region		03-08				09-10				2011
Developing economies		7.0		1.9		6.4		1.4		6.0		..
East Asia		8.9		0.6		8.6		0.4		7.6		2.0
South Asia		8.0		2.5		7.5		1.4		6.5		2.2
South-East Asia		6.0		2.0		5.5		2.3		4.8		2.7
West Asia		6.3		2.3		5.2		3.6		6.6		4.3
North Africa a		5.1		4.2		4.8		2.3		-0.5		1.3
Sub-Saharan Africa		6.4		3.0		5.4		2.8		4.7		..
Latin America and  the Caribbean		4.8		2.8		4.1		1.7		4.3		1.9
Transition economies		7.4		1.2		5.4		-0.5		4.5		1.0
Developed economies		2.3		1.3		1.4		-2.4		1.4		2.4
North America		2.4		1.3		1.5		-2.0		1.7		0.7
Asia		1.6		0.3		0.8		-0.8		-0.7		-2.1
Europe		2.4		1.4		1.5		-1.0		1.6		0.2
Source: UNCTAD, TDR 2011 (Table 1.1) and TDR 2010 (Chart 3.3), March 2012 update
Note: a North Africa excluding Sudan.

Given the pivotal importance of GDP growth as contributing force behind job creation and the prevalence of unemployment or underemployment in economies in general, events such as the collapse in GDP growth in the global crisis are bound to have a major impact on the employment and labour market situation too. It turns out that countries that achieved a quick and full recovery from the crisis generally only experienced a temporary deterioration in the employment and labour market situation. Until now, this has proved true for developing countries at large, although regional disparities exist. The global crisis has temporarily dented the favourable trends established during the global boom of 2003–2007, but not derailed the benign developments. In principle, developing countries are thus generally facing the same kinds of challenges regarding job creation and poverty reduction as prior to the crisis, their principal problem being that of deficient productive capacity rather than its underutilization.

 

The situation is starkly different in major developed economies, where actual GDP is falling well short of potential output and large negative output gaps persist (Table). In these economies the short-run challenge remains to fully undo the crisis impact on GDP and employment by appropriate macroeconomic policies. In case of failure, crisis-induced unemployment would in due course be classified as structural, which would become true to the extent that a deterioration of human capital (a loss of skills and morale due to long-term unemployment) and lack of physical capital (for lack of investment) artificially creates a state of deficient productive capacity resembling the situation in developing countries. Labour market and welfare system reforms designed to accentuate downward wage pressures would not solve the underlying problem of deficiency of effective demand in these countries, but make them also more similar to developing countries in terms of a widespread prevalence of working poor. It would also tend to make these economies more export reliant and focused on external competitiveness. 

The fragile and unfinished recovery of major developed economies affects developing economies as the former represent critical export markets for the latter. Ill-guided policies in developed countries pose new and additional challenges in developing countries.

• Highlights

• There is a strong link between GDP growth and employment creation;
• The relative role of social safety nets and informal employment varies in developed vs. developing economies, and stark differences in employment status of the labour force persist;
• The employment impact of the global crisis has proved temporary in many developing economies, but lasting in major developed economies;
• The underlying problem of insufficient effective demand and possible ill-guided policies pursued in developed economies cause spillover effects in the developing world.

Sexual harassment in the workplace

Sexual harassment is unwelcome sexual behaviour, which could be expected to make a person feel offended, humiliated or intimidated. It can be physical, verbal or written. 

Sexual harassment is covered in the workplace when it happens:

• at work
• at work-related events
• between people sharing the same workplace
• between colleagues outside of work. 

Responding to harassment

All incidents of sexual harassment  no matter how large or small or who is involved require employers or managers to respond quickly and appropriately. Just because someone does not object to inappropriate behaviour in the workplace at the time, it does not mean that they are consenting to the behaviour.

The law

Sexual harassment is against the law. Some types of sexual harassment may also be offences under criminal law and should be reported to the police, including indecent exposure, stalking, sexual assault and obscene or threatening communications, such as phone calls, letters, emails, text messages and postings on social sites

Liability

While the person who sexually harasses someone else is liable for their behaviour, employers can also be held vicariously liable for acts of sexual harassment by their employees or agents. 

Sexual harassment can involve employees, managers, contractors, agents, clients, customers and others connected with or attending a workplace. It can happen at work, at work-related events or between colleagues outside the work environment.

A common workplace

A workplace covers any place that a person attends for the purpose of carrying out their work or trade. They do not need to be an employer or employee of the workplace.

For example, Miki is contracted by an employment agency to fill a short-term reception role with an IT company. During her two-week placement she is sexually harassed by one of the company’s staff. Although Miki is not an employee of the IT company she is still covered by the law.

Industrial organisations

Employees or members of industrial organisations must not sexually harass other employees or members of the organisation, or people seeking to become a member.

For example, Louise is a union member and workplace representative for her union. At a union meeting she is sexually harassed by another member. She is covered by the law.

Qualifying bodies

Employees or members of a qualifying body, such as a professional association, must not sexually harass other employees or members, or people seeking action on an occupational qualification.

For example, Justine is a dental hygienist and a member of a professional association. On a professional development course run by the association she is sexually harassed by one of its employees. She is covered by the law.

A partnership

A partner in a firm must not sexually harass another partner or anyone seeking to become a partner at that firm.

For example, Noel is up for partnership at a law firm when he is sexually harassed by one of its senior partners. He is covered by the law.

Volunteers and unpaid workers

Volunteers and unpaid workers have the same rights and responsibilities in relation to sexual harassment as paid staff. 

Source: Victorian equal opportunity& Human rights commission 

Access date: 7/20/2015

Effective ways of handling employee grievance

Grievance may be any genuine or imaginary feeling of dissatisfaction or injustice which an employee experiences about his job and it’s nature, about the management policies and procedures. It must be expressed by the employee and brought to the notice of the management and the organization. Grievances take the form of collective disputes when they are not resolved. Also they will then lower the morale and efficiency of the employees. Unattended grievances result in frustration, dissatisfaction, low productivity, lack of interest in work, absenteeism, etc. In short, grievance arises when employees’ expectations are not fulfilled from the organization as a result of which a feeling of discontentment and dissatisfaction arises. This dissatisfaction must crop up from employment issues and not from personal issues.

Grievance may result from the following factors-

1. Improper working conditions such as strict production standards, unsafe workplace, bad relation with managers, etc.
2. Irrational management policies such as overtime, transfers, demotions, inappropriate salary structure, etc.
3. Violation of organizational rules and practices

The manager should immediately identify all grievances and must take appropriate steps to eliminate the causes of such grievances so that the employees remain loyal and committed to their work. Effective grievance management is an essential part of personnel management. The managers should adopt the following approach to manage grievance effectively-

1. Quick action- As soon as the grievance arises, it should be identified and resolved. Training must be given to the managers to effectively and timely manage a grievance. This will lower the detrimental effects of grievance on the employees and their performance.

2. Acknowledging grievance- The manager must acknowledge the grievance put forward by the employee as manifestation of true and real feelings of the employees. Acknowledgement by the manager implies that the manager is eager to look into the complaint impartially and without any bias. This will create a conducive work environment with instances of grievance reduced.

3. Gathering facts- The managers should gather appropriate and sufficient facts explaining the grievance’s nature. A record of such facts must be maintained so that these can be used in later stage of grievance redressal.

4. Examining the causes of grievance- The actual cause of grievance should be identified. Accordingly remedial actions should be taken to prevent repetition of the grievance.

5. Decisioning- After identifying the causes of grievance, alternative course of actions should be thought of to manage the grievance. The effect of each course of action on the existing and future management policies and procedure should be analyzed and accordingly decision should be taken by the manager.

6. Execution and review- The manager should execute the decision quickly, ignoring the fact, that it may or may not hurt the employees concerned. After implementing the decision, a follow-up must be there to ensure that the grievance has been resolved completely and adequately.

An effective grievance procedure ensures an amiable work environment because it redresses the grievance to mutual satisfaction of both the employees and the managers. It also helps the management to frame policies and procedures acceptable to the employees. It becomes an effective medium for the employees to express t feelings, discontent and dissatisfaction openly and formally.

Source: management study guide 2013

Job hunting/recruitment and selection process in my dear country Nigeria(part4)

While waiting to hear from Mr Dapo I got a call from an HR recruiting agency asking if I could attend an interview in a week's time I happily said yes I will"after all I had nothing doing at home aside waiting to hear from Mr Dapo on my resumption date". 

As I was planing for my trip for the interview, I was a bit nervous but when I thought of my previous interview experience with Mr Dapo I felt good and confident with my self. Two days to the interview date I embarked on my journey,as soon as we got in to the city,I  checked in to a hotel and rested from the long trip. 

As I woke up it was 11pm "wow how time flys". I decided to read some likely HR questions to help prepare me for my interview the next day. Luckily for me I had a friend who lived in the city and stayed close to the hotel I was in.

He picked me up from the hotel to the venue of the interview, as we drove down to the interview center we discussed about likely HR questions and argued about the remuneration most organisations offer these days, and I thought to myself; this is one thing that is always up in my head when ever I am applying for a job. 

As I got to the venue I looked around, at first and said to my self "I don't think I like the looks of things around here" but regardless, I said my goodbyes to my dear friend as he zoomed off. I walked up to the the security guard and asked for the precise location of the interview. As he pointed to a building just beside me,I thanked him and walked away. 

I climbed up the stairs, and the first thing I noticed was the dirty stairs, i wondered "what the hell is this for Christ sake". I got to the office knocked and I heard some one shout "yes come in".

As I walked straight to the reception I greeted a slim dark lady who had a smile on her face and asked me if I was here for the interview. "Yes ma I am here for the interview, I got a call from Mrs Matthew" The lady smiled and directed me to one of the seats at the reception to wait for Mrs Matthew.

As I took my seat, I looked around and noticed some ladies seated at the other side of the reception waiting for an interview too. They all kept staring at me, and it made me feel so uncomfortable and I suddenly began thinking to myself " I am over dressed for this kind of place jeez!!!" 

After 6 mins a short, plus size lady walked up to me with a big smile, And I immediately took note of her nice dentition. "Hello Clara nice to see you come into my office". I stood up, followed her and she told me to take a seat ,she still had the wide smile as she greeted me pleasantly and welcomed me in to her small office. 

She began to tell me more about the organisation she works for and how their role is to get qualified employees to clients. As I was briefed on the job, I got to realise it was not an HR role but a personal assistant role "what is with me and  personal assistant jobs" 

She briefed me about her client and explained the nature of the job, afterwards she directed me to an inner room where my interview was going to take place with a collegue of her's and then she took her leave.

While waiting for my interviewer  to come in I looked around the room trying to imagine what the interviewer might ask me in regards to the job. After 5mins a slim young lady about 5.5 ft tall walked in to the room, with a smile on her face, she greeted me and asked for my name and a copy of my resume. 

She introduced her self as the HR officer and asked me if I understood all what Mrs Mathew had discussed with me. I smiled and nodded, and she asked "tell me about your work experience"  I smiled and told her all my past work experiences and what I had learnt and achieved so far. While I was talking to her I was looking at my resume and discussing about the roles I played in each of  the organisations I worked for and as I was talking she cut me short and said to me "can you stop looking at your resume and just look at me and discuss" I looked at her in shock cause I did not see anything wrong with talking to her and at the same time having a glimpse of my resume. 

From my study in HR there was no issue with looking through your resume and discussing your roles with your interviewer. It's like given a lecture and flipping through your books while discussing with your students. 

 She went further asking some questions that I did not think was relevant in a job interview.... Questions like " why do you look so pretty?"  On hearing this I could not say anything at that moment but laugh cause I was amazed at such a question. I did not respond to her question but only smiled and looked down at my resume I was holding in my hand"saying to my self what an awkward question though". 

The interview was finally over after 15mins and Mrs Matthew came in to the room with all smiles asking how my interview went I told her all went well. She told me she will give me a call in 3 days time so I should hope to hear from her and hopefully I get the job. I smiled and said okay ma I hope to hear from you too, thank you. 

As I walked out of the office, I could not wait to get back to my hotel eat and sleep.

As soon as I got to my hotel I called my parents and told them how the interview went, we laughed about it and my dad said to me not to worry, since I have a better job waiting for me. "once Mr Dapo sends you an email get ready to pack your stuff and leave for your new job just forget about this interview you went for since it's a PA job and they have already given you a clue that their client is very demanding and troublesome so no need accepting the offer even if the lady gives you a call in two days time". I thought about this and decided to take to my dad's advice. 

I got a call from the very jovial Mrs Matthew She explained to me that I would not be suitable for the job since I only have an HR personnel experience and no Personal assistant experience but she has another offer for me will I be willing to take it ?  And I responded "Mrs Matthew I am sorry but I don't think I will be willing to accept that offer as I have already been offered something else, i am only just waiting for the confirmation email from the HR of the organisation". I could feel the disapointment from her voice and she said okay that is fine, you have my number please give me a call anytime you decide to change your mind, thank you and take care. 

I felt bad and hoped the action  I just took was the right thing, I was just ready to pack my bags and go home.

As soon as I got home I told my family about my interview experience and how I felt awkward by the interviewer. We all had a good laugh about it and hoped for better ones to come along the way and we still kept our hopes high on hearing from Mr Dapo very soon.

One week after my awkward interview experience I got a call from a long time friend telling me about a short contract job I could apply for with the organisation she works for. She told me the HR department needed my skills to perform some tasks for some clients. I immediately told her I was intrested even though it was just a two months contract. She went ahead to give the HR officer my phone contact for a phone interview with me.I looked forward to the call. I got a call from the HR officer four days after I spoke to my friend, The lady explained,what the organisation needed me to do and she also informed me that it's a two months contract job. She tried to explain the benefits for me taking the job, for example i get to build a relationship with the organisation and I can get references from the managers for future purposes. To me it was a good deal and atleast I wanted the experience too.

I discussed this with my best friend and my family, and I thought to my self what if as I am working at this organisation I get a call from Mr Dapo to resume work immediately since he had told me to prepare and get ready. I was so confused I did not know what to do, so I went ahead to discuss it with my dad, because I always trust his opinion, he said to me he had no problem with me taking the contract job but what if I get a call from Mr Dapo to resume work in a week's time what would I tell the organisation am already working for? "Clara you don't want to fail any of them so you have to think properly and follow your heart,but I will advice you not take the contract job so you don't loose the permanent job you are about to get. Because all you are waiting for is the confirmation email from Mr Dapo telling you when to resume, so I don't think you should risk that for a contract job that is just for 2months"as I listened to my dad I made sense from what he was saying, I actually did not want to dissapoint any of these organisations.  I decided to give my friend a call informing her that I would not be taking the contract job again, because I made a promise to the manager of the organisation I had a successful interview with and I also do not want to fail your organisation too by leaving them when I have resumed work. 

My friend advised me to still take it since I have not been given an offer letter from my previous interview with Mr Dapo. I told my friend I did not want to risk it, I understand she is really concerned but I will just wait to hear from Mr Dapo am very positive about this. 

"oh well Clara that is fine since you have made up your mind I wish you luck and hope to hear from you once you resume at your new place of work. All the best love"  as I hung up I said to my self " I hope I made the right decision....(sigh)".

Two months passed and still nothing from Mr Dapo......

I decided to send him an email "hello Mr Dapo I trust all is fine with you? I have been expecting to hear from you hope all is fine? Hope to hear from you soon in regards to my application,

Thanks.

Clara

I became worried and started having mixed feelings on what might have happened that had made Mr Dapo not contact me, I started discussing with my family and we all started wondering why Mr Dapo took so long for a response. I had to start praying about it asking God questions..."father give me a sign please...". 

I decided to check my email the next day and Mr Dapo had responded to my email  my heart skipped a beat as I was about to open the mail "Dear Clara am so sorry I have not gotten in touch with you these past months, we have been so busy trying to work out on how we can put you on our pay roll system as the company's financial manager informed us that the company's financial budget is very low at this period so he doubt's if employing a new staff to the company would be possible because of the tight budget. I am honestly trying my best to see what can be done, am so sorry but I will get back to you once things have been sorted out. Take care.

Dapo.

As I read those words I felt heart broken and disappointed I didn't even know the right words to respond to his email I just closed my laptop and went to the kitchen to have a glass of water before I told my mum the contents of the email I just got from Mr Dapo,as I told my mum I could see the disappointment all over her face, she tried to encourage me not to worry I should just hope for the best and start re-applying for jobs, I had no choice anyway. I walked up to my room laid on my bed with thoughts of the two job offers I had just missed tears rolled down my eyes.

Woke up the next day feeling so down did not feel like talking to anybody I just wanted to be all alone and have no conversation with anybody. That week was a very quiet one for me cause I kept on hoping I will get a call from Mr Dapo but unfortunately for me 2 weeks passed and no call from him. I started applying for  jobs again, telling friends to be on the look out for me incase they see any job opening that might be applicable to my field of study and experience. I made sure I applied for three jobs or more every day like my dear friend would say...."the hustle is real"  I was just applying non stop hoping to get a call or a respond to any of the emails I had sent to HR managers of organisations in regards to job openings in their company.

Another month passed and still no response from Dapo, it gradually started dawning on me that nothing might possibly be done in other for me to get an offer in that company. I decided to forge ahead for better things.

Just when I was just about to feel all relaxed and accustomed to sitting at home all day applying for jobs online, I got an email from an organisation, the HR manager contacted me asking if I could attend an interview in a week's time,it was an IT firm that was in need of an HR officer . I quickly responded to the email stating " I will be able to make it just give me a time and  date" I got a response immediately for the time and date of the interview. It felt like a breath of fresh air I could not wait to travel and attend this interview and hopefully get this job.

It was now time for me to travel for my interview, anxiety and fear had the best of me. Would I get this job? Can this interview just go fine? I hope I am favoured. Thoughts and thoughts of the interview lingered through my mind all through my trip. 

To be continued........

HR Suggestions/Recommendation

- As a job applicant always make good use of a job offer you get,don't hope on a job you have not been giving an offer letter/resumption date 

- A qualified HR personnel would always confirm from his/her financial manager of the organisation before putting up adverts for job recruitment

- One of the first rule for job applicants is to continuously apply for jobs till you get your dream job

- During an interview process always make eye to eye contact with your interviewer and make sure you sell your self even as you discuss your past job experiences

- As an HR personnel when interviewing job applicants make sure you try to keep it formal and let your interviewee feel comfortable and relaxed. It's not proper for you to make an applicant feel tensed or scared.