BEE Partner, South Africa Economy Watch

In Australia, despite the paradigm shift in macroeconomics from Keynesian demand management to the monetarist supply-side approach, empirical evidence still supported the use of expansionary fiscal and monetary policy and public sector job creation (for example, Mitchell, 1987a, 1987b, 1994, 1996; Mitchell et al., 1995). The solutions proposed, however, relied heavily on income policy guidelines and were not, in retrospect, comprehensive enough. Further, the stimulus that would be forthcoming was not conceived to be adequately focused to support environmental sustainability, a goal usually ignored in orthodox macroeconomics. In this context, the Job Guarantee reflects work that was conceived when this author was a fourth-year student at the University of Melbourne in the late 1970s. Read the rest of this entry »

The application of functional finance to the operation of the labor market in the form of the payment of wage subsidies to employers to encourage the hiring of disadvantaged workers is a means for altering the mix of employment in their favor while also improving the inflation/unemployment trade-off. One proposal, which related specifically to teenage workers, suggested giving all teenagers vouchers that can be used either for schooling or to subsidize employers who hire them (Feldstein, 1973). This proposal has not been translated into policy. However, under the now phased-out Concentrated Employment Program (CEP), employers were reimbursed for the costs of job training to encourage them to hire workers they would otherwise not consider. Reimbursement of training costs incurred by firms that locate plants in or near slum areas is provided for under the Jobs Opportunities in the Business Sector (JOBS) program. Read the rest of this entry »