Analysing key job quality indicators allows countries to evaluate their progress and identify potential growth areas. The OECD has developed a framework to measure and assess the quality of jobs that considers three objective and measurable dimensions. By examining earnings quality, labour market security and the working environment, the framework offers a comprehensive assessment of job quality.
Job quality
With such a large amount of time spent at work, job quality plays a vital role in our overall quality of life. Fair wages, benefits, and good working conditions enhance worker well-being, while also improving productivity and innovation. Quality jobs also reduce inequality, foster social cohesion, and prioritise health and safety, which benefit both individuals and communities. Countries must therefore prioritise job quality as well as increasing overall employment.
Key messages
Employment protection refers to only one dimension of the complex set of factors that influence worker security and firm adaptability. The OECD indicators of employment protection legislation evaluate the regulations on the dismissal of workers on regular contracts and the hiring of workers on temporary contracts. They cover both individual and collective dismissals.
Collective bargaining and social dialogue are key labour rights and have the potential to make job markets more inclusive. As major demographic and technological changes re-shape the labour market, collective bargaining is well placed to generate solutions to emerging collective challenges. However, its capacity to deliver is threatened by the weakening of labour relations in many countries and changing employment trends.
Context
Minimum wages
Minimum wages can help mitigate losses in purchasing power and ensure a fair distribution of the cost of inflation between firms and workers. Governments should therefore ensure that statutory minimum wages continue to adjust regularly to keep up with inflation.
In recent years, inflation has reached levels not seen in the last four decades, hitting disproportionally the poorest households. Despite this, minimum wages are struggling to keep up. Currently, 30 out of 38 OECD countries have a statutory minimum wage in place. In the 8 OECD countries without a statutory minimum (Austria, Denmark, Finland, Iceland, Italy, Norway, Sweden and Switzerland), sector or occupation-level collective agreements include de-facto wage floors for large parts of the workforce.
Trade unions and collective bargaining
Collective agreements can help companies and workers find tailored and ad hoc solutions to fairly share the cost of inflation, for instance by limiting wage increases in exchange for lump-sums and/or non-wage benefits.
As the digital transformation, globalisation and demographic changes are re-shaping the labour market, collective bargaining is more important than ever in designing solutions to emerging collective challenges.
However, trade union density has been decreasing steadily across OECD countries for the last 40 years. When combined with the weakening of labour relations in many countries, this could threaten its potential to enable an inclusive and high-quality labour market in the future.
AI’s impact on job quality
AI’s potential impact on job quality is complex. On the one hand, 60% of workers overall are worried about potentially losing their jobs to AI. On the other hand, workers in the manufacturing and finance sectors who work with AI tend to be positive about its impact on performance and working conditions. 4 in 5 workers say AI improved their performance and 3 in 5 said it increased their enjoyment in work.
There is a clear need to help workers and employers in reaping the benefits of AI while adapting to it, notably through training and social dialogue. At the same time, policy action is crucial to address the risks that AI can pose when used in the workplace, especially in terms of labour rights.
