Inappropriate employment incentives
Other Names: Ill-conceived incentives for employment
Reinforcement of unemployment
Inadequate work incentives
Nature: As the "baby-boom" generation ages, skilled labour is becoming more difficult to find and to keep. Unemployment benefits in many developed countries are too close to minimum wages to make "drudgery" style employment worth the effort. There is a unprecedented demand for a sense of individual and team significance and for a level of involvement in the whole working process itself, for which few production systems are prepared. A culture of unemployment is developing, in which many people would prefer to be unemployed than to work in undesirable circumstances. This culture is not without its social price. The pattern of wages and salaries in some countries sustains a perverse incentive structure which over-encourages searching, or waiting, for certain types of work. The result is a number of candidates far exceeding that which can be absorbed in the occupations concerned. The incentive structure, making a limited number of job categories more desirable than the rest, may arise as a result of market forces freely creating a demand, and hence offering a premium to certain occupations. It may also be artificially created by government policies that attract large numbers of workers to one or a few types of developmental sectors, to the neglect of the infra-structure viewed as a totality.
Problem Type: D: Detailed problems
Date of last update 28.04.2000 – 00:00 CEST