Globalisation is a fact
Globalisation is a fact. Does offshoring lead to job losses in the Netherlands? What is the perspective of Dutch workers?
The public debate on globalisation mainly focuses on the loss of jobs resulting from offshoring, i.e. shifting production to a different country. However, offshoring can also create new jobs in the Netherlands. SEO Economic Research was commissioned by Delta Lloyd Group to carry out research into the impact of offshoring on employment in the Netherlands and the consequences for Dutch workers.
SEO Economic Research’s principal finding was that there was no structural difference in the consequences of job losses resulting from offshoring and job losses attributable to other causes. Globalisation does, however, call for greater flexibility on the part of both the government and workers. The globalisation theme is consistent with Delta Lloyd Group’s ‘The Future Secured’ strategy, under which it is seeking to take specific account of its customers’ financial sustainability.
The public debate on globalisation mainly focuses on the loss of jobs resulting from offshoring, i.e. shifting production to a different country. However, offshoring can also create new jobs in the Netherlands. SEO Economic Research was commissioned by Delta Lloyd Group to carry out research into the impact of offshoring on employment in the Netherlands and the consequences for Dutch workers.
SEO Economic Research’s principal finding was that there was no structural difference in the consequences of job losses resulting from offshoring and job losses attributable to other causes. Globalisation does, however, call for greater flexibility on the part of both the government and workers. The globalisation theme is consistent with Delta Lloyd Group’s ‘The Future Secured’ strategy, under which it is seeking to take specific account of its customers’ financial sustainability.
Principal findings of the research
The key question of the research project ‘Offshoring and the Dutch worker’ concerned the impact of globalisation and offshoring on individual workers. The findings were that:
• Workers in sectors that are susceptible to offshoring (primarily manufacturing industry and the financial and business services sectors) are not at any greater risk of losing their jobs than employees in sectors that are less susceptible to offshoring.
• The key factors in finding a new job are education and age, not offshoring or the threat of offshoring.
• The salary changes experienced by people moving jobs are no different in the case of employees losing their jobs as a result of offshoring than for employees losing their jobs for other reasons.
• The effect of offshoring on the number of job switchers within the overall economy is barely noticeable. It is simply one of the many reasons why the economy and the labour market are in constant flux.
• There are, however, sectors in which the risk of job losses as a result of offshoring is higher. Examples are IT, banking, insurance, and other internationally oriented industries.
• There are winners and losers from offshoring, but the experiences of employees losing their jobs as a result of offshoring are no different from those losing their jobs for other reasons.
• Workers in sectors that are susceptible to offshoring (primarily manufacturing industry and the financial and business services sectors) are not at any greater risk of losing their jobs than employees in sectors that are less susceptible to offshoring.
• The key factors in finding a new job are education and age, not offshoring or the threat of offshoring.
• The salary changes experienced by people moving jobs are no different in the case of employees losing their jobs as a result of offshoring than for employees losing their jobs for other reasons.
• The effect of offshoring on the number of job switchers within the overall economy is barely noticeable. It is simply one of the many reasons why the economy and the labour market are in constant flux.
• There are, however, sectors in which the risk of job losses as a result of offshoring is higher. Examples are IT, banking, insurance, and other internationally oriented industries.
• There are winners and losers from offshoring, but the experiences of employees losing their jobs as a result of offshoring are no different from those losing their jobs for other reasons.
The right instruments
When globalisation occurs and jobs are lost, we need schemes and facilities to help people find new jobs as quickly as possible. These include the reintegration policy and a relaxation of the law on termination of employment, which may encourage employers to create more jobs. These measures will enable people to find alternative employment sooner. And an ageing population also means a growing need for such measures because older workers generally find it more difficult to absorb shocks than younger workers.
Greater flexibility
SEO Economic Research therefore makes a number of recommendations, which are endorsed by Delta Lloyd Group:
• First of all, the Netherlands should have a policy that does not hinder globalisation or offshoring. The Dutch economy has always been an open economy and has benefited from international competition over the years. And it is important that it continues to do so in the future. This competition increases productivity and promotes creativity, thereby benefiting consumers.
• The Netherlands also needs a policy that promotes the efficient reallocation of employment, and addresses such issues as the unemployment benefit system and the costs of hiring and firing. The creation and loss of jobs is essential to our market economy. Our future welfare state will function well if and when individuals who lose their jobs can be confident that they will find a new job as quickly as possible, or even that they will find a better job.
• Lastly, it is vital to have a policy of life-long investment in employee employability. In other words, making sure that people joining the labour market are trained as well as possible. Not letting talent go to waste. Making sure employees remain employable. And that is the responsibility of employees and employers alike.
For further information, please contact Patrick Koimans, Public Affairs Manager.
• First of all, the Netherlands should have a policy that does not hinder globalisation or offshoring. The Dutch economy has always been an open economy and has benefited from international competition over the years. And it is important that it continues to do so in the future. This competition increases productivity and promotes creativity, thereby benefiting consumers.
• The Netherlands also needs a policy that promotes the efficient reallocation of employment, and addresses such issues as the unemployment benefit system and the costs of hiring and firing. The creation and loss of jobs is essential to our market economy. Our future welfare state will function well if and when individuals who lose their jobs can be confident that they will find a new job as quickly as possible, or even that they will find a better job.
• Lastly, it is vital to have a policy of life-long investment in employee employability. In other words, making sure that people joining the labour market are trained as well as possible. Not letting talent go to waste. Making sure employees remain employable. And that is the responsibility of employees and employers alike.
For further information, please contact Patrick Koimans, Public Affairs Manager.
Download the full report 'Offshoring and the Dutch worker'.
