Setting the scene

There is one thing ‘developed’ (high income) and developing (low and middle income) countries have in common: the lack of good jobs for a decent income to all. Whereas underdeveloped and emerging countries are struggling to create more jobs in the formal economy because only these jobs seem to ensure decent and stable income over the life course, advanced economies are struggling to build dams against the intrusion of informal and ‘nonstandard’ jobs to prevent increasing poverty and inequality. Is there any common ground in fighting against ‘informal’ for more ‘formal jobs’ and fighting against ‘informal’ for maintaining ‘formal jobs’, which means so-called standard employment relationships? Could it be that – at the global level – a common ground of social policy appears to become one of the most urgent requirements of ensuring more and better jobs on both sides of the world of work?

The argument in the following chapter is straightforward: a full employment strategy based on the ‘standard employment contract’ will fail on both sides. Social security based on the institution of fulltime, open-ended and dependent wage work cannot be the paradigm of global social policy. Ultimately, people have to be protected, not jobs. Without jobs in some formalised – legally ensured and socially recognised – labour contract, however, protection of people remains an empty promise. A sustainable employment strategy has to acknowledge the instrumental (earning income) as well as the intrinsic value of employment, which means the identity building aspect of labour relationships. Whereas the ‘developed’ world can learn from the virtues of flexible and imaginative informal jobs, the ‘underdeveloped’ world can learn from the virtues of smartly regulated labour contracts. Flexibility through social security and social identity is the solution, and not the neoliberal credo of security through flexibility and market arbitrariness.

In the following, I intend to corroborate this argument by two provocative empirical observations, their explanation and theoretical generalisation. From the European point of view, it is the variability of employment relationships – in particular in terms of working time – which provides the clue to inclusive growth. From the point of view of less developed or emerging countries it is work related income guarantees, in particular the state as employer of last resort, that are a promising path towards smartly formalised employment relationships.