Governments’ primary goals in Labor Market Management
The WCC Group is a leading provider of advanced solutions for Public & Private Employment Services. Using more than 20 years of experience in solutions for Labor Market Management and Employment Services, WCC has developed the Employment Platform to meet the sector’s needs. A fully customizable modular solution, based on our unique smart ELISE Smart Search & Match Platform technology. In order to fulfill our customers’ needs in a rapidly changing market, WCC closely follows government labor market strategies and trends.
Understanding the evolving role of IT in labor market management is a primary goal of WCC. Directly helping WCC to anticipate the future demands of our Employment sector clients.
In this series of blogs, we take a look at labor market management and the changing role of IT. In this first part, we begin by examining the strategic role of government agencies. In other words, what are their primary goals when managing the supply and demand for labor? In later blogs, we’ll go on to describe Trends in Public Employment Services (PES) and explore technological advancements in search technology. We also look at PES requirements for an IT solution. And naturally, show how WCC can deliver that solution.
Balancing supply and demand
The imbalance between supply and demand in a dynamic labor market is a global challenge. There are, of course, many issues that influence this imbalance. For example, the skills needed by employers change continuously, while jobseekers’ legacy skills don’t always match those needs. Unforeseen market issues, economic change, population aging, and immigration also have a significant impact on supply and demand.
Ensuring that the supply of workforce skills matches demand from employers is a crucial goal, and vital for any country’s economy. However, there are marked differences between the strategies governments use to manage this gap and the extent to which their Public Employment Services can support them. Any intervention ultimately depends on economic and cultural factors, as well as the political situation and current state of the labor market in each region.
Strategic goals in labor market management
Some countries have only just begun to address labor market management, while others already have sizeable organizations and advanced IT systems in place. However, regardless of a country’s specific challenges and requirements, we can identify several common strategic goals.
Firstly, one of the most important goals for any government is to decrease the amount spent on unemployment benefits. In other words, to match people with jobs as quickly as possible to keep them in employment. But it is essential to realize that although matching people with the first job within reach may achieve short-term success, it is not necessarily sustainable. If people only seek work similar to their previous post, they may find such work is no longer available. Some types of jobs are simply disappearing (so-called ‘sunsetting’ jobs). We’ll come back to this point later.
The second crucial goal of labor market management is the ability to anticipate developments in the workforce, as well as fluctuations in demand for specific jobs. If governments can identify market imbalances and take action before it is too late, they can decrease spending. They can, for example, encourage the development of new industries, and take steps to increase the availability of trained workers. But information needs to be available quickly so that governments can anticipate these changes. And therefore form and implement relevant and timely policies. Not just at the country level, but at regional and local levels too. Management of foreign workers and labor migration also needs to be part of any strategy. Once Active Labor Market Policies (ALMP) are in place, PES can enhance their effectiveness by tailoring specific programs to small target groups in selected regions. Such programs can include training and education, as well as other kinds of support.
Maximizing labor force potential
The third goal for governments is to maximize the potential – and hence the value – of the total labor force. Developing the workforce not only benefits individuals by helping them reach their full potential. It also makes it easier for governments to implement their overall policies. For instance, by ensuring that essential skills are available as new types of jobs emerge. As a result, jobseekers will face less risk of repeated periods of unemployment. However, this process requires a long-term vision for the pro-active development of the workforce.
PES is one of the agents involved. We’ve seen already that matching jobseekers with the first available job is not always sustainable. Caseworkers can instead help jobseekers look for alternatives based on their skills, flexibility, ambitions, other interests, and even character traits. Perhaps by providing advice on personal development, coaching, further education, or training in order to widen the scope of available jobs.
Governments can, in turn, allocate funds to maintain and continually develop workforce skills to meet market demand. While at the same time helping to achieve their objectives and ambitions.
Achieving goals for labor market management
WCC’s world-leading solutions for the Public Employment sector can help governments achieve all these goals. Our Employment Platform empowers PES, by providing core services to a wide range of user groups, ranging from jobseekers, employers, PES counselors, to recruitment consultants. In our next blog, we take a look at how labor market trends affect PES.
If you would like to find out more about our Employment Solutions, please get in touch.