Dec 2, 2015 - Labour Market Information Systems / National Employment Portals / National. Employment ..... Real estates, Business Act & finance. 73,600.
LABOUR MARKET REFORM COMMISSION Technology, Innovation & Productivity Committee Discussion Paper & Priority Recommendations
Commissioner Silburn Clarke FRICS, DFJCS Chairman December 2nd 2015
Labour Market Reform Commission Commissioners Chairman,
Dr Marshall Hall
Vice Chairman,
Mr. Silburn Clarke Chair, Technology Innovation and Productivity Committee
National Coordinator, Mr. Lloyd Goodleigh, Chair, Labour Policy and Legislation Committee Dr Wayne Wesley, Dr Heather Rickets, Mr. Wayne Jones,
Chair, Education and Training Committee Chair, Social Protection Committee Chair, Industrial Relations Committee
Ms. Brenda Cuthbert Dr. Michael Witter Sen. Kavan Gayle Prof Gossett Oliver Ms. Yvette Sutherland-Reid
Mr. Dwayne Gutzmer Mr. Easton Williams Ms. Janet Morrison Mr. Errol Miller
Mr. Robert Gregory Mr. Danny Roberts Dr. Noel Cowell Mr. Granville Valentine
Technology, Innovation and Productivity Committee Chair: Commissioner Silburn Clarke Dr Vanesa Tennant, Dr. Marina Ramkissoon, Mr. Mervyn Eyre, Dr. Andrea Barrett, Dr. Andre Jones, Ms. Sonia Jackson,
Working Groups Chair Labour Market Information System Chair, Human Factors and the Workspace Chair, Public Sector Efficiency Chair, National Systems of Innovation Chair, Small & Medium Enterprises Chair, Cross-cutting Issues
Commissioner Prof. Gossett Oliver Commissioner Robert Gregory Commissioner Dwayne Gutzmer Prof. Ishenkumba Kahwa Prof. Neville Duncan Dr Charles Douglas Dr Kavian Cooke Mr. Rudolph Thomas Ms. Tashana Briscoe
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LABOUR MARKET REFORM COMMISSION Technology, Innovation & Productivity Committee Discussion Paper & Priority Recommendations December 2nd 2015 Commissioner Silburn Clarke, Chair Introduction
This initial Discussion Paper of the Technology Innovation and Productivity Committee (TIPC) summarises the first six months of deliberations by this Committee of the Labour Market Reform Commission. The paper presents the top three priority recommendations from the TIPC's five Working Groups viz; Labour Market Information System; Public Sector Efficiency; National Systems of Innovation; Small & Medium Enterprises; and Human Factors in the Workplace. The purpose of the Discussion Paper is to serve as a vehicle for consultations, debate and fine-tuning of these initial recommendations of the TIPC.
TIP Committee Membership
The TIP Committee boasts a diverse membership comprising stakeholders from trade unions, employers, academia, international development partners and the public service including the Ministry of Labour and Social Security and other Government entities.
Mandate
Recommend programmes and services for increasing international competitiveness of small and medium enterprises (SMEs); Draft policies and programmes intended to strengthen and accelerate Jamaica’s capacity in technology generation, adoption and transfer; Recommend policies to improve public sector efficiency and performance in support of enhancing the labour market and consequently, economic growth and development; Enhance Jamaica’s labour market information systems; Strengthen and modernize the Jamaica Productivity Centre (JPC) in order to support innovation and efficiency transformations in both the private and public sectors;
Areas of focus: 1. 2. 3. 4.
Quality of the workforce Quality and excellence of business organisations (private and public) International competitiveness of firms Technology generation, adoption and transfer
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5. The role of the Jamaica Productivity Centre 6. Labour Market Information Systems / National Employment Portals / National Employment Service
Achievements to date:
Comprehensive desk research on quantitative and qualitative data and reports Wide stakeholder consultations Organisation of five Working Groups on SME; Labour Market Information; Human Factors in the Workplace; National Systems of Innovation; Public Sector Efficiency Completion of Discussion Paper on Technology Innovation and Productivity (Dec 2015)
Summarised Draft Priority Recommendations
1. The development of a clear, unambiguous, sustainable and equitable method to align compensation of employees with productivity of firms 2. Strengthen the enabling environment for the encouragement of indigenous innovators through, inter alia, modernising the Patent Act 3. Encourage the increase of business innovators in the economy by supporting pro-active solutions for the high-growth, export oriented firms eg Innovation Fund 4. Recommendation to boost productivity through a change in culture among public sector workers. This may include the time-limited performance contracts for all heads of Public Sector Bodies, renewal based on their ability to increase agility 5. Encourage widespread Pension participation in order to significantly grow the pool of longterm savings within the economy for supporting investments in domestic firms and provide employers with additional benefits for attracting and retaining talent 6. Develop a Pension Asset Allocation class for supporting equity participation in SME’s with a minor percentage from local Pension Plan; recommended 1% maximum. 7. Include “human factor / psychosocial” variables in data collection procedures in surveys at the national level in a regular and systematic manner in order to make determinations as to the implications of such variables on productivity and innovation of firms and employees 8. Develop collaborative skills within and across organisations in an effort to counteract tendency to build barriers and silos 9. Amplify the orientation of the Jamaica Productivity Centre to include collection and psychosocio-cultural analysis of human factors that affect productivity and innovation 10. Promote the engagement of Work Psychologists and Occupational Psychologists to support the well-being of organisation’s members and so improve productivity 11. Implement fiscal and monetary policies to create more research and development activities supporting innovation from the private sectors 12. Radically reform the curriculum of schools in order to significantly improve STEM performance so as to develop downstream robust STI orientations and mindsets 13. Engage stakeholders who are developers of infrastructure to promote innovation activities within the economy 14. Recommendation to develop macro-economic policies aimed at reducing the informality and un-registration in the economy 15. The establishment of an efficient labour market system through a fully functioning labour market information system should involve a well-coordinated approach to the collection, analysing and publishing of labour market information 16. Revisit the role of the Labour Market Information Technical Advisory Committee (LMITAC) 17. Increase the use of technology to foster data sharing and collaboration; and analysis of data across stakeholder institutions
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18. The development of a national policy to have all persons enrolled in the secondary, tertiary and vocational institutions registered to the labour market information system. Such a mandate would facilitate greater knowledge among students regarding career options, demanded skills and present and projected growth areas in the economy. 19. Mandate all public sector entities to post vacancies and search for jobs via the labour market information system. Vacancies to be advertised in various forms of media, prior to applications for work permits 20. Implement Government of Jamaica information technology governance framework. Governance framework to speak to Government leaders being trained in effective governance of information technology and technology-based innovation as an essential leadership capability 21. Deliver shared information technology services through eGovJa across Government Ministries, Departments and Agencies 22. Pro-actively promote a culture of partnership within MDA’s and between MDA’s and the private sector. Accelerate workflow technologies between government agencies. Accelerate PPP’s with private sector
National Context: 1. Existential threat to the Jamaican society, economy, way of life and civilization
Fig 1: Annual GDP rates and Period for doubling GDP
a. Observation: i.
The average annual GDP growth rate for the economy has been historically below 1%; 40year average at 0.8% (WB). This performance has persisted over several periods (PIOJ: see box insert) Jamaica Historical GDP Performance These historic rates would require 5 generations to double i. Past four decades - 0.8% national GDP ii. 1990- 2014 period - 0.88%
ii.
b. Conclusion 1.
iii. iv. v.
2000- 2014 2014 FY 2015 (Apr – Jun)
- 0.59% - 0.5% - 0.6%
The existential threat to the Jamaican society, economy, way of life and civilization is our failure to successfully and sustainably grow our GDP and so
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increase national prosperity for our citizens and subsequently equitably distribute prosperity gains throughout the society Without the growing and preservation of national wealth, the quality of life is challenged Jamaica will not achieve objective of becoming the place of choice to live, have families and do business in 2030 at these historic rates of GDP growth. In the strategy to achieve a significant take-off in GDP growth performance, the labour market should not be a retardant, a constraint nor a braking factor.
2. 3. 4.
c. Way Forward Actions / Options: i. ii. iii. iv. v.
Craft and articulate one national long-term strategy to significantly grow prosperity: ensure that actions are coherent with the national growth imperative Recalibrate the implementation approach to Vision 2030 Quickly reform or remove any entity that is not aligned with national thrust Ensure that all national stakeholders are aligned and onboard with one long term strategy (government, business, workers/employees, academia, youth) Focused policy management and direction to assure that all aspects of government are aligned with the National Growth Agenda.
2. Firms are essential for successfully and sustainably growing GDP and so increasing national prosperity a. Observation i. ii.
iii.
iv.
v.
vi. vii.
Governments are to GDP as firms are to markets While GDP growth must be facilitated by the government, it is globally competitive firms operating successfully within global marketplaces that will be able to sustainably harvest margin revenues from global consumers Majority of business leaders tend to be domestic-market oriented rather than export-oriented Jamaica has been categorized as a Stage 2 economy by the World Economic Forum (WEF) in their 2015 Global Competitiveness Report (see box insert) Attributes of Stage 2 economies include increasing firm competitiveness driven by education and training as well as rising wage increases based on increasing efficiencies / productivity The quality of the national talent pool directly impacts firm’s ability to adapt science to production processes and technologies, and so innovate, be productive and ultimately competitive Efficient firms optimize GDP output within existing Production Possibility Frontier (PPF) but innovating firms grows and expands the PPF to new levels thereby creating new GDP spaces
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viii. ix. x. xi.
State of cluster development is low (93/140: WEF 2015) Production process sophistication is low (87/140, WEF 2015) Patenting is low (82/140, WEF 2015) Firm spending on R&D is low (74/140, WEF 2015)
b. Way Forward Actions / Options: i. ii.
A major shift in mindset, orientation and culture towards innovation and global market demands is urgently needed in the business sector Encourage and incentivize firms that are export-oriented
Stage I Haiti Nicaragua
Transition I to II Honduras
Stage II Jamaica Dom Rep Guyana
Transition II to III Costa Rica Barbados Panama
RESOURCE-BASED ECONOMIES
EFFICIENCY-BASED ECONOMIES
Countries compete based on their factor endowments: primarily unskilled labour and natural resources. Compete on the basis of price and sell basic products or commodities, with their low productivity reflected in low wages.
Countries begin to develop more efficient production processes and increase product quality. Competitiveness is increasingly driven by higher education and training. Wages have risen and they cannot increase prices
Stage III Trinidad
INNOVATION ECONOMIES
Companies must compete by producing new and different goods using the most sophisticated production processes and through innovation. Wages will have risen by so much that they are only able to sustain those higher wages and the associated standard of living by higher value
3. State of our national talent pool (academia / knowledge creators) a. Observations i. ii. iii. iv. v. vi. vii.
The higher the incidence of Knowledge Economy factors within an economy is the higher the economic performance; with a correlation of 0.84 (WEF 2008, see box insert) The availability of scientists and engineers in the Jamaican economy is low (99/140, WEF 2015) The ratio of tertiary level graduates in the labour force is low (refer sec 4B) Research and development in private and public sectors are low (WEF) The ability for the society as a whole to tap into the creativity and inventiveness of the broad population is weak as the nation’s Patent Act dates from1857 Government acquisition of advanced technology products is low (107/140, WEF 2015) There is a serious mis-match between industry demands and tertiary output as the unemployment among Caribbean region’s young tertiary graduates is very high with (ECLAC 2015)
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b. Way Forward Actions / Options: 1. 2.
Modernise the Patents Act urgently A process of on-going re-examination of the output of tertiary institutions to assure alignment with industry needs is urgently needed.
4. State of our national talent pool (employees) a. Observations 1. 2. 3. 4. 5.
68% of our employed labour force has no certification (746k of 1.094mill: STATIN 2012) 63% of our employed labour force has no training (691k of 1.094mill: STATIN 2012) Despite a budget of J$26billion (2012/2013), each year an estimated 30,000 kids of secondary school-age are added to the pool of non-certified talent. (MOE, 2012/13) Quality of math and science education is low (96/140, WEF GCR 2015) Primary, secondary and tertiary education enrollment are deemed low in global comparisons (WEF 82/140 , 93/140 and 79/140 respectively, WEF 2015)
70% uncertified
70% certified
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b. Way Forward Actions / Options: i. ii. iii. iv. v.
vi.
Conduct demographic study to determine the detailed profile of the 70% uncertified A shift in model, ie a flipping of the script, to reduce non-certification to 30% would have a profound ripple effect is all areas of society and economy Get it right the first time, every time; Students graduating from five years of secondary education and training must be empowered with academic and/or technical/vocational and/or creative (arts/sports) skills / certification Avoid duplication and triplication of government remedial spending on same cohort of youngsters Training of youth should emphasise critical thinking and adaptability as 21st century futures are highly dynamic. Jobs for next 5 , 10 years are not defined today Implications for Education and Training Committee
5. State of our macro-economic framework / enabling environment a. Observations i.
Macro-economic stabilisation of economy is encouraging (lowered inflation rate, inflation targeting, dynamic forex rate tied to PPP competitiveness. ii. Consequential lowering of interest rate for borrowing for SME’s is slowed due to high stickiness in financial institutions iii. Pension funds are off-limits for funding domestic entrepreneurs except via blue chip corporate bonds and stock market equity participation
b. Way Forward Actions / Options: i. ii.
Financial intermediation is in need of reform. is archaic and do not adequately support entrepreneurs and entrepreneurial activity (Contrast with M-Pesa in Kenya) Unlocking and enabling asset small allocation from $300billion pension funds for the Jamaican productive sector would release funding to SME’s
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iii. Lending practices of commercial banking sector needs reform to facilitate more competitive loan pricing for SME’s. iv. Competitiveness signaling provided by devaluation must be complemented with other incentives for SME exporters (Innovation Fund, R&D Investment Write-off, Special Interest rates for Exporters) v. Threshold for disengaging CEO’s should be more dynamic (OECD 2013 Assessment of 2012 LM Reform in Spain: Three quarters of weak financial performance is 2012 threshold for fair dismissal of CEO)
6. Status of the Labour Market
a. Observations: 1. 2. 3. 4.
In a recent assessment of the country’s Labour Market Efficiency by the WEF GCR the most inefficient factor was adjudged to be the mis-alignment of pay with productivity. This factor scored a very low global ranking of 111 out of 140 countries (WEF 2015) Hiring and firing practices are rated low (80/140, WEF 2015) Labour-management cooperation are also rated low with a ranking of 75when compared to other economies (WEF 2015) National capacity for the retention and attraction of talent enjoyed ‘very low’ and ‘low’ ratings respectively.
b. Way Forward Actions / Options: 1. 2.
Expand the role of the JPC in the determination of firm-level productivity assessments in order to support compensation and productivity alignment Human Factors Working Group to examine psychosocial factors operating within firms
7. Changing Population Demographics a. Observations: i. Fertility rates have been declining and will continue to decline to 2030 (STATIN)
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ii. Population growth rates are expected to decline to –0.1% in 2030 from 0.36% in 2011; to record population shrinkage in 2030 iii. Percentage of population over 65 years is projected to reach 11% in 2030 from 8.1% in 2011 and 4.3% in 1969. iv. While the 15-64 years group is expected to remain stable at 65.9% (in 2011) and 66% (in 2030). However, the 15-29yrs sub-group is projected to shrink by 2030 (STATIN, see box insert), thereby increasing the average age of the 15-64 years age cohort.
b. Way Forward Actions / Options: i. ii.
Projected shrinkage among population of digital natives and millennials and implications for workforce creativity, dynamism, adaptability, energy, flexibility and agility to be examined by TIPC Implications for pensions, health, unemployment to be examined by Social Protection Committee
Composition of workforce by age group
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8. Public Sector Efficiency a. Observations: i.
ii.
iii.
iv.
v.
vi.
Wastefulness of government spending, low public trust in the Executive Branch of government, unreliability of police services and over-regulation are the major weaknesses reported in public sector institutions (WEF 2015, see box insert) Service delivery is wanting in the education sector. Despite a secondary education budget of J$26billion outcomes are less than effective with a very level of non-certification (MOE 2012/13 Sectoral Debate). Weaknesses observed in HIV incidence, life expectancy and infant mortality when compared to global averages (WEF 2015, see box insert) Economies enjoying higher levels of health, education and security tend to be more innovative, productive and prosperous In a comparative analysis of 23 Latin American and Caribbean economies, on the efficacy of government spending to public sector performance, Jamaica was ranked 22nd (IDB, 2013, see graphic) The Jamaican public sector was adjudged as delivering less effective and less efficient outcomes to its citizens and economy when compared to its counterparts in the region (IDB, 2013, see graphic)
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b. Way Forward Actions / Options: i. Healthy, secure and educated population is a vital necessity for improving economic growth trajectory ii. Superior quality of leadership and management of the public sector directly impacts the sector’s ability to deliver transformational outcomes; particularly in a context of tightly constrained financial resources and perceived low workforce motivation and engagement. iii. Optimising fit of strategy, systems, structure and structure of public sector to support the needed high growth regime iv. Culture of public sector needs urgent reform. In order to build dynamism and agility, all heads of agencies should be on time-limited performance contracts as obtain in Executive Agencies.
9. Informal Sector a. Observations i. The number of persons employed within the informal sector represents a significant portion (37.85%) of the employed labour force as shown in Table 9.1. ii. The “Informal Sector” is as defined by STATIN and is in accordance with the international definition being used by the ILO: All own-account workers and employers who own informal enterprises Employees working in enterprises with less than 10 employees All contributing family members All employees in jobs where NIS contributions are not deducted from the wages. iii. It is to be noted that the definition does not include “workers in the agricultural sector” (207,800 in 2014; 18.5% of the LFS) and “household domestic workers” (32,100 in 2014; 2.9% of the LFS) iv. Un-registration and informality are challenges that need to be addressed in a structured manner and sustained manner that all workers may benefit in the long run. v. It is to be noted that even though agricultural workers and domestic workers are not included in the informal sector, many of these workers are also unregistered with and are not participating in the NIS. Table 9.1 - Informal Sector Employment Year 2014 Male Formal Informal Agriculture Domestic Worker Unclassified TOTAL
Female
205, 700 255,200 169,000 0 9,600 639,500
TOTAL 237,000 170,000 38,800 32,100 4,800 483,500
%age
443,300 425,400 207,800 32,100 14,400 1,123,000
39.47 37.85 18.50 2.90 1.28 100
Associated with the informality are the other related observations: vi. Social Welfare benefits such as NIS and pensions are not available to persons in the informal sector. The comparative ages of the persons employed in the formal and informal sector, Table 9.2 indicates that more persons remain employed in the informal sector after the usual retirement age of 65. In addition there are a higher number of persons in the 55-64 age group, who are approaching their pensionable age without the necessary securities for retirement. vii. Under-education of the population within the informal sector (See Table 9.3). The undereducation of persons within the informal will restricts their upward mobility and their ability to transfer to jobs which require higher levels of skills and competencies, particularly within the formal sector.
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viii. Construction and Private Household Employment represents the sectors of the economy in which there is the highest employment within the informal sector (See Table 9.4). ix. While the highest volume of informality occurs within the geographic regions of Rural Areas and the KMA, (See Table 9.5), informality outstrips formality in the Rural Areas and in Other Urban Areas; x. Government Services almost doubled as a percentage of GDP over the 1970-2014 period (STATIN); juxtaposed against the efficiency and effectiveness outcomes noted in Observation 8.a.vi above Table 9.2 – Comparative Ages of Employed Persons Ages Formal Informal 14 - 19 20 - 24 25 - 34 35 - 44 45 - 54 55 - 64 65 & over TOTAL
5,000 56,300 142,100 113,900 80,200 39,000 6,800 443,300
10,200 38,100 107,800 112,600 90,500 45,700 20,500 425,400
Table 9.3 – Educational Qualification by Highest Exam Exam Formal %’age Informal None (uncertified) CXC Basic, JSC 5 SSC CXC Gen., GCE “O” 1-2 CXC Gen, GCE “O” 3-4 CXC Gen, GCE “O” 5+ GCE A 1- 2 GCE A 3 or more Degree Other Not Stated TOTAL
150,000 8,600 15,300 34,500 44,500 1,600 4,800 134,000 20,000 29,500 443,300
Table 9.4 – Employment by Industry Group Industry
34% 2% 3% 8% 10% 0% 1% 30% 5% 7% 100%
Formal
Mining & Quarrying Manufacturing Elec., Gas & Water Construction Wholesale, Retail & Repairs Hotels & Restaurants Transport & Storage Real estates, Business Act & finance Public Admin., Education & Defence Health, Social work & Personal Services Private Household employee Not Stated TOTAL
%’age
336,200 5,700 11,300 16,200 12,400 600 1,100 14,900 10,600 16,300 425,400
79% 1% 3% 4% 3% 0% 0% 4% 2% 4% 100%
Informal 5,400 34,000 7,900 10,100 63,700 46,200 32,200 73,600 122,200 44,100 1,400 2,000 443,000
%’age informality
0 37,100 0 68,100 157,000 32,400 41,800 17,200 4,400 43,600 21,900 0 425,400
0% 52% 0% 87% 71% 41% 56% 19% 3% 50% 94% 0% 49%
Table 9.5 – Employment by Geographic Region of Residence Region Formal Informal KMA Other Urban Areas Rural TOTAL
215,500 88,500 139,300 443,400
152,700 90,100 182,600 425,400
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b. Way Forward Actions / Options: 1.
2.
3.
The changing structure of the economy (see Table 9.6) from production to services requires that workers be better educated and possess some of the soft skills which are essential for functioning in today’s world. Employers and employees are to be targeted to reach those persons who have no basic qualification or training to become more equipped to deal with their present employment status. Under-registration in the NIS needs to be addressed through direct contacts with the employees and the employers and public education strategies. The target populations should be all persons in the informal sector, private household employees and the agricultural sector. The development of macro-economic policies aimed at reducing the informality and un-registration in the economy.
c. Impact: I. II. III.
Better educated and skilled workers will be more productive Registration and participation in the NIS programme will alleviate old age poverty, thereby reducing dependency on the state. A reduction of the size of the informality will facilitate better management of the economy
Table 9.6 - Changing Structure of the Economy - %age Contribution INDUSTRIES
1970
1980
1990
2000
2011
2014
Wholesale, Retail; Repairs; Install.
18.9
19.2
18.2
19.7
18.9
17.6
Producers of Government Service
7.9
14
7.4
11.7
14.2
13.15
Real Estate, Renting ,etc.
9.5
8.5
9.9
9.3
12.2
10.74
Financial & Insurance Services
3.5
4.8
6.8
9
10.2
11.05
Transport, Storage & Commun.
5.5
5.1
8.4
10.7
9.7
10.99
Manufacturing
15.8
16.6
16.9
10.5
9.2
8.46
Construction
13.3
5.8
7.2
7.6
7.3
7.12
Other Services
5.6
4.3
6
6.6
6.7
6.9
Agriculture Forestry & Fishing
6.4
8.2
6.8
7
6.5
6.98
Hotels & Restaurants
1.6
0.9
6.1
5.1
4.3
5.55
1
1.6
2.2
3.2
3.6
3.16
Mining & Quarrying
12.7
14.2
7.8
4.2
1.5
2.32
Less: FISM
1.7
3.3
3.7
4.6
4.3
4.02
100
100
100
100
100
100
Electricity & Water Supply
Total Value Added Source: www.statinja.gov.jm
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19702014
TOP THREE PRORITY RECOMMENDATIONS from TIP Working Groups
Working Group
Chair
a. b. c. d. e. f.
Dr Vanesa Tennant Mr. Mervyn Eyre Dr Marina Ramkissoon Dr Andrea Barrett Comm Silburn Clarke / Dr Andre Jones Ms. Sonia Jackson
Labour Market Information System WG Public Sector Efficiency WG Human Factors WG National System of Innovation WG SME WG Cross Cutting Issues
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Top 3 recommenda-ons from SME TIP Working Group (as of December 2, 2015) #
Our Observa+on is ….
The Impact is …
Our Recommenda+on is …
The Benefit Will Be …
Policy, Legisla+on, Administra+ve or Programme
1
Lack of breadth of op0ons for funding entrepreneurial ventures have been iden0fied as a major impediment to the development of high growth export-‐ oriented SME firms Simultaneously, long-‐term domes0c savings represented by the domes0c Pensions is locked off from high growth export-‐oriented SME firms. These savings currently stands at over JAD $300billion Investments by pension funds in the real produc0ve sector of the na0onal economy is a con0nued and repeated call by Pension Trustees
• The ability of firms to increase global market ac0vity is stymied • The contribu0on of firms to expansion of GDP is consequently thwarted
Explore innova0ve op0ons to increase funding solu0ons to the high-‐growth, export-‐oriented sector
• Encouragement of entrepreneurial ac0vity among high-‐growth, export-‐oriented SME’s
Policy, Administra0ve and Programme
• Authorise a very small propor0on of pension savings to be deployed to provide funding solu0ons to the high-‐growth, export-‐oriented SME sector. • Authorise a new asset class within the pension asset classes to the high-‐growth, export-‐oriented SME sector. • Set the asset class limit at 1%. This ac0on would release $3billion to the high-‐growth, export-‐ oriented SME sector. • One management model: The funds could be pooled into a centrally managed Na0onal Innova0on Fund, which then takes equity posi0ons in firms in the high-‐growth, export-‐oriented SME sector. • The target firms would buy-‐back the ini0al equity stake of the NIF over 0me as the firms grow and expand • The Jamaica Produc0vity Centre would be tasked with delivering training to the targeted high-‐ growth, export-‐oriented SME’s in areas of Leadership, Collabora0on, Technology, Human Factors, Innova0on, Produc0vity, Compe00veness
• Encouragement of medium-‐ growth to strive to high-‐growth status • General signaling to society of increased entrepreneurial focus and ac0vity • Increased market ac0vity by firms • Increased innova0on and produc0vity by firms • Increased contribu0on to GDP by firms
Top 3 recommenda-ons from SME TIP Working Group (as of December 2, 2015) #
Our Observa+on is ….
The Impact is …
Our Recommenda+on is …
The Benefit Will Be …
Policy, Legisla+on, Administra+ve or Programme
2
The link between compensa0on and produc0vity is weak at the firm-‐level The signals used by firms and representa0ves of talent for seYling on compensa0on increases are oZen0mes not derived from the internal specifics of the firm but oZen on external macro factors eg infla0on, devalua0on The process can be likened to a na0onal collec0ve bargaining process where na0onal signals determine firm-‐level decisions and the idiosyncrasies of the firm are subsumed The narra0ve between talent holders and businesses in the area of produc0vity needs to be made less ambiguous, clearer and certain
• The ability of firms to quickly adjust compensa0on is inhibited
Develop a clear, unambiguous, sustainable and equitable method to align compensa0on with produc0vity
• Alignment of compensa0on with produc0vity
Policy, Legisla0on, Administra0ve
• Develop appropriate methods for firms to determine their level of produc0vity • Jamaica Produc0vity Centre to inves0gate and recommend methods for firm-‐specific assessments of produc0vity • Jamaica Produc0vity Centre be empowered to deliver a service to firms to audit and report firm-‐ level produc0vity
• Compensa0on driven by firm-‐ level dynamics
Top 3 recommenda-ons from SME TIP Working Group (as of December 2, 2015) #
Our Observa+on is ….
The Impact is …
3
The enabling environment for the • Very low level of innova0on encouragement of indigenous performance and output at firm and innova0on is lacking individual levels The delivery of sustainable market-‐ accepted product and services depend of the ini0al thoughts of creators, inventors, innovators, ideators followed by a process of protec0ng these ideas, par0cularly those with commercial promise Jamaica’s Patent Act is dated from 1857, was designed for an era long gone and is woefully out of date Very low level of paten0ng ac0vity
Our Recommenda+on is …
The Benefit Will Be …
Policy, Legisla+on, Administra+ve or Programme
Move rapidly to modernise the Patent Act
• Encouragement of the idea0on and inven0on poten0al among all Jamaicans
Policy, Legisla0ve and Programme
• Development of a pool of ideas for investors to examine, filter and commercialise • Solu0ons to Jamaican context-‐ specific problems would be encouraged
Labour Market Reform Commission Technology, Innovation and Productivity Committee Human Factors Working Group
TOP THREE PRIORITY RECOMMENDATIONS (Draft)
WG Chair:
Dr. Marina Ramkissoon
Members:
Ms. Sonia Jackson (Co-Chair) Dr. Vanessa Tennant (Co-Chair) Ms. Tashana Briscoe Commisioner Silburn Clarke
Date:
December 2nd, 2015 Preamble
Policy development process: • • • • • • •
Identify policy issues Establish principles underlying policy statements Establish objective and purpose of the policy statements Outline strategies, protocols, procedures etc. to implement policy statements Review of existing policies to avoid duplication Obtain feedback from key stakeholders on proposed policy statements Establish monitoring and evaluation process and procedures for policy
Key Definition: “Human factors” are broadly defined as psychological, social-psychological and cultural factors at the individual, group and organizational levels
Policy issue in brief (preliminary observations)
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There is insufficient data gathered on ‘human factors’ at the national level in a regularized and systematic manner. There is insufficient data on ‘human factors’ to conduct statistical analyses to determine their impact on productivity and innovation of firms and employees. For example: • Labour Force Survey traditionally focused on underemployment although it has included the informal sector recently • JSLC focuses mostly on households and emphasizes poverty assessment • Data on innovation and knowledge use are sometimes measured in terms of patents generated or literacy rates rather than in terms of individual behaviour
Expected impact
Lack of empirical support for the impact of human factor variables on productivity and innovation result in these factors being neglected in planning and design of strategies to increase productivity and innovation at the national level. Productivity continues to be viewed in mostly economic terms.
Fundamental principles
A psycho-socio-cultural framework for understanding human behaviour in the workplace is required to complement the current knowledge on productivity and innovation.
Policy objective/prescription
Include ‘human factor’ variables in data collection procedures in surveys at the national level in a regular and systematic manner.
Recommended procedures, strategies, guidelines, processes or protocols etc.
1. The JPC should collaborate with entities like STATIN to design and execute an annual survey on human factors which impact innovation and productivity. 2. The JPC should consult with an HRD expert to inform the content of the survey.
Timeline
12 months
Expenditure
TBA
Policy issue in brief (preliminary observations)
2
During the preliminary discussions of TIPC and HFWG, several barriers to productivity and innovation were identified: lack of collaboration among key stakeholders, the operation of silos, and individual defensiveness. These issues are considered to be prevalent across public and private sector organizations, as well as within organizations. For example: • Currently, lack of collaboration among institutions is hindering attempts of TIPC sub-groups (LMIS) to achieve their goals • The national MSME Entrepreneurship policy (2013) noted that there needs to be greater collaboration among all the key stakeholders at all levels nationwide for the provision of training and development services for MSMEs. • Despite numerous calls for increased collaboration and despite numerous meetings, individuals and organizations continue to operate in silos because they lack collaborative skills and intentions
Expected impact
Fundamental principles
The discussions suggest that the impact of the LMRC may be significantly diminished if lack of collaboration results in its policy recommendations not being implemented in a strategic and integrative manner across all relevant organizations. • Effective collaboration is not only necessary in order to thrive, it has become essential even to survive, because organizations cannot compete externally if they can’t first collaborate internally. • Effective collaboration has become the fastest, easiest, most cost effective way to become more competitive in the market place.
Policy objective/prescription
To conduct training workshops to build collaborative skills with key stakeholders from organizations including but not limited to: Statistical Institute of Jamaica (STATIN), Planning Institute of Jamaica (PIOJ), Ministry of Labour and Social Security, Private Sector Organization of Jamaica, Jamaica Productivity Center, HEART Trust, leading institutions of higher education, LMRC, and trade unions.
Recommended procedures, strategies, guidelines, processes or protocols etc. Timeline
See detailed proposal submitted to LMRC.
Expenditure
See proposal
4 months (November 2015, or February 2016)
Policy issue in brief (preliminary observations)
3
The JPC takes a primarily economic approach to defining and understanding productivity at the expense of a broader theoretical approach which includes psychology, social psychology and sociology. This economic orientation currently limits the training options which it offers and its analysis of barriers to productivity. For example: • The JPC conducts mostly labour market and GDP analyses • Calculates productivity in economic terms • Sees improved labour quality in terms of skill upgrading
Expected impact
The JPC’s stated priority objectives of promoting a national productivity conscious culture and building productivity-driven private and public sector organizations may only be partially achieved.
Fundamental principles
•
Policy objective/prescriptions
The JPC should increase its capacity to conduct psycho-socio-cultural analysis of “human factors” relating to productivity and innovation, to complement its current economic orientation.
Recommended procedures, strategies, guidelines, processes or protocols etc.
The JPC should create a job post for an Organizational Behaviour Specialist or an Industrial/Organizational Psychologist, or seek the services of a similarlytrained consultant to help design research and interventions geared towards the required culture change.
Timeline
12 months
Expenditure
TBA
A psycho-socio-cultural framework for understanding human behaviour in the workplace is required to complement economic analysis of productivity and innovation.
Top 3 recommenda-ons from LMIS TIP Working Group (as of December 2, 2015) #
Our Observa+on is ….
The Impact is …
Our Recommenda+on is …
The Benefit Will Be …
Policy, Legisla+on, Administra+ve or Programme
1
Collec(ng, analyzing and publishing of Labor Market Informa(on needs strengthening. • Duplica(on of data by Suppliers
• Duplica(on of development, analysis, and ineffec(ve dissemina(on.
• The establishment of an efficient labour market system through a fully func(oning LMIS should involve a well-‐coordinated approach to the collec(on, analyzing and publishing of LMI. • Revisit and revamp the role of the Labour Market Informa(on Technical Advisory CommiJee (LMITAC) –charge CommiJee to implement procedures, strategies, policies to foster greater integra(on Coordina(on and Harmoniza(on among players • Use technology (such as the ILO toolkit)to foster data sharing and collabora(on-‐ where the network of ins(tu(ons, persons and informa(on that have mutually recognized roles, agreements and func(ons w.r.t. the produc(on, storage, dissemina(on and use of labour market related informa(on and results in order to maximize the poten(al for relevant and applicable policy and programme, formula(on and implementa(on
• Increase coordina(on in the supply, analysis and dissemina(on of LMI
Policy and Programme
• Suppliers generally operate independently without sharing data. • Data suppliers face difficulty when collec(ng data from primary sources and secondary sources (while STATIN’s data collec3on system is guided by a Sta3s3cal Act, the other providers of LMI do not have a legisla3ve framework to carry out this func3on. ) • Greater level of analysis is required to determine, validate and predict the demand for and supply of labour.
• Absence of a LMI governance structure policies and procedures, liJle or no financial or other resources and unclear lines of demarca(on for the produc(on of and the clearinghouse for labour market research results and other informa(on
• Greater use of technology to gather data (.g in the field) and to analyze data • Capacity building programs to undertake improvement in the LMIS-‐ Administra(ve and Analysis • The Annual Return form should be modified to collect addi(onal data to enrich Labour Market Informa(on -‐ to assist with the collec(on of wage data
• Increase efficiency in analysis and dissemina(on of LMI • Increased standardiza(on of labour market informa(on produced • Improved ability to meet (me lines and carry out assigned tasks in a (mely manner • Increase the quality of informa(on produced by efficiently and accurately measuring the demand for and supply of labour to guide stakeholders
Top 3 recommenda-ons from LMIS TIP Working Group (as of December 2, 2015) #
Our Observa+on is ….
The Impact is …
Our Recommenda+on is …
The Benefit Will Be …
Policy, Legisla+on, Administra+ve or Programme
2
The LMIS faces serious challenges with skills mismatch, as there are (mes when jobs are posted on the system/database and suitable candidates are not found to match what the employers are looking for. It therefore means that more jobseekers with specific skills need to be encouraged to register on the system/database.
• Incomplete representa(on of the available, emerging and obsolete skills in Jamaica
Develop policy from a Na(onal perspec(ve to have all persons enrolled in Secondary, Ter(ary and Voca(onal ins(tu(ons registered to the LMIS
• Comprehensive skills bank which informs users on the number, emerging, obsolete and available skills in Jamaica
Policy and Programme
• All public secondary & ter(ary schools are required to complete a census • Assign Career Counselors and/or retrain/retool Guidance Counselor • Mandate Career week on a yearly basis – (this will lead to Career Development) • Mandate registra(on or make it enforceable at gradua(on – (development of school’s core curriculum to support that) • Sensi(ze graduates, provide direc(on for career path, cross match skills with jobs •
3
Under-‐u(liza(on and/or lack of Compliance of LMIS by Employers
• Absence of a national database that can provide viable option to employers looking for these skills.
• All public sector en((es should post vacancies and search for jobs via the LMIS, the Ministry of Labour and Social Security portal
• No mo(va(on for job-‐seekers to register, especially when employers recruit through private agencies or word of mouth
• Vacancies (LMIS) must be adver(sed on LMIS and in print and electronic media prior to work permit applica(on
• Improve awareness of the benefits of the portal to graduates of these ins(tu(ons • An increase in the types of cer(fied persons with specified skills set • Improvement in the op(ons available to employers for selec(on of candidates based on their posted vacancies
• An increased number of jobs will be posted on the LMIS • Increased opportunity for locals to apply for adver(sed posi(ons • Increased capacity building for more Jamaican jobseekers
Policy
Top 3 recommendations from the National Systems of Innovation (NSI) TIP Working Group as at December 3, 2015
Our Observation is…
The Impact is …
Our Recommendation is …
The Benefit Will Be …
Program / Policy
1
A research & development (R&D) culture led by our policy-‐makers for pillar sectors of the economy. Eg. Agriculture, Health, Manufacturing
The creation of innovative initiatives for the production of commercialized products and services relating to respective sectors which may contribute to cross linkages within other sectors and contribute to the country’s GDP
Develop a national R&D budget with buy-‐in from key stake holders e.g. SRC Implement fiscal and monetary policies to create more R&D activities supporting innovation from the private sectors.
Identification of value-‐added innovative goods and services for both domestic and international markets
Policy and Program
2
Cohesive educational reform supporting STI; starting at the primary school level
Creation of a cadre of young scientists who can be potential inventors/innovators
Sustainable curriculum reform in the areas of the natural sciences, and applied mathematical sciences to augment existing STEM programs
Development of human capital with robust STI mind-‐ set as a basis for STI transformation in strategic areas of the economy
Policy and Program
3
Support Services to facilitate innovation initiative
Development of a robust infrastructure supporting innovation initiatives to promote innovation activities within the economy
Engage stakeholders who are developers of infrastructures necessary for innovation initiatives
Societal buy-‐in of unified NSI agenda
Both policy and programs, however more program oriented.
Top 3 recommendations from the Public Sector TIP Working Group (as of December 2, 2015) #
Our Observation is ….
The Impact is …
Our Recommendation is …
The Benefit Will Be …
Policy or Programme
1
Leadership: The required Information Technology (IT) Governance capabilities and frameworks do not exist to support the effective adoption of IT, knowledge management and innovation in the public sector workplace.
•
Slow or poor adoption of technology tools in the public sector workplace, denying workers the opportunity to be creative in the context of a modern knowledge-based society; results in poor productivity.
•
Public sector leaders (Ministers, Permanent Secretaries, Supervisors) be trained in the effective governance of IT and technology-based innovation as an essential leadership capability Implement a Government of Jamaica (GOJ) IT Governance framework, with urgency.
•
Improved productivity and a motivated workforce where employees have greater confidence in leadership.
Programme
Access to Technology and Skills: Fundamental Information Technology tools to support effective collaboration and knowledge sharing across government agencies do not exist, and public service agencies are unable to compete in attracting and retaining the key talent required for effective technology adoption.
•
The expected business outcomes of technology projects are not realized. In some instances, projects completely fail. A bureaucratic, siloed approach to work is perpetuated, disempowering the labour force and making government an unattractive place to work.
•
Accelerate the plan to deliver shared IT Services (through eGovJa) across government agencies, along with associated governance and change management.
•
A Shared IT Service strategy will provide MDAs with access to technology at lower cost and will allow GOJ to pay for key skills at market rates. Access to essential technology tools will result in a more empowered, knowledgeable workforce equipped to deliver improved productivity with greater job satisfaction.
Programme and Policy
Culture of Partnership: Government does not have a culture of partnership across Ministries Departments & Agencies (MDA’s), nor with the private sector
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Major opportunities are being lost for process innovation across agencies, and for the public sector workforce to collaborate more effectively. The benefits of adopting new business models to increase public sector productivity and contribute to the development of the labour market are being lost.
•
A transformed, knowledgeable public sector workplace with exemplars of Public/Private Partnership-based innovation.
Policy and Programme
2
3
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Accelerate the adoption of workflow and business process management technology across agencies, with supporting governance and best practices. Accelerate implementation of PPPs (or other Private/Public Sector vehicles) within the technology and knowledge services industry.
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