The Director of Workers’ Activities at the International Labour Organization (ILO), Maria Helena André, defended that it was “fundamental” to maintain social support to companies and workers, fearing a “delayed shock” if it is withdrawn by Governments.
The International Labor Organization (ILO) official, who was participating in the conference “The Role of Social Economy in Job Creation and the Implementation of the European Pillar of Social Rights”, organized by the Portuguese presidency of the Council of the European Union (EU), said it was “fundamental that continuous efforts be maintained, both nationally and at the EU level, to support all workers and companies”.
“The economic and financial programs implemented by governments and the EU have been successful in supporting businesses and workers,” he stressed.
While acknowledging that such support contributes to “increasing the pressure on public finances in the future”, Maria Helena André fears “a delayed shock, both for companies and workers, if governments withdraw this support for the economy”.
“If you look at the ILO monitoring reports, what you see is that the greater the fiscal stimulus as a percentage of GDP [gross domestic product], the lower the loss of working hours,” she pointed out.
Therefore, “the fiscal stimulus measures, for example, the simplified lay-off in Portugal (…), play a very important role in supporting economic activity and reducing the fall in the number of hours worked,” argued the ILO official.
Taking into account that “the most recent forecasts point to greater economic growth in coming years,” Maria Helena André argues that what should be done, for now, “is to ensure that those who suffered most during the pandemic will also be able to benefit from this recovery.
In this sense, “the economic recovery must take into account alternative economic models that put people, rather than profit, at the center of their operations,” she argued, pointing to the social economy as a response to the “enormous challenges” caused by the pandemic COVID-19.
The ILO official underlined that “the pandemic has not affected everyone in the same way”, since “young workers, women, migrant workers, as well as all those who are not in a formal employment relationship have suffered disproportionately” the effects of the crisis caused by COVID-19.
Speaking at the same conference, the Secretary General of the Organisation for Economic Co-operation and Development (OECD), Angel Gurría, underlined the “positive impact” of the social economy in relation to working conditions, since it brings together economic activities that are not only aimed at profit, and, although private in nature, share objectives with the public sector.
The social economy, he said, “increases the labor market, creating and maintaining employment, particularly for the most unprotected groups,” and “reinforces the role of a responsible negotiating model between the economic partners and the social partners,” he added.
“The goal is to have more inclusive practices in companies. There are models, such as cooperatives, in which workers participate in the management of the company itself and this can allow the recovery of certain companies that are suffering from the crisis,” he pointed out, referring to the practice known as worker buyout.
This practice consists of a restructuring process in which employees buy part or all of the company they work for, thus becoming the owners of the company.
“There is a lot of potential in the social economy in the sense that it plays a strong role in an inclusive economy,” said Angel Gurría, adding that the “OECD is working intensively with international and local authorities, as well as international organizations in the business sector, to unlock this potential” of the social economy.
