"Globalisation and its Impact on Employment"

What is globalisation?

Globalization is this process of rapid integration or interconnecting between countries. More and more goods and services investments and technology are moving between country.

Globalisation has both positive and negative impacts on employment including:

What is the impact of globalisation on employment? 

The impact of globalisation on employment is controversial and depends on many factors, including the domestic economic conditions of a country.

Increased competition

Globalisation can lead to increased competition between companies, which

can result in job losses, closures, and offshoring.

Increased mobility

Globalisation allows workers to move across borders to find better employment opportunities. This can lead to skilled workers to moving to higher paying jobs, but can also lead to low-skilled workers experiencing wage pressure and job insecurity.

Economic mobility 

Globalisation can increase economic mobility by widening the path up the jobs ladder for low-wage workers.

Technological advances

Rapid technological advances can lead to the disappearance of traditional work and the creation of new occupation.

Income disparity

Globalization can contribute to income disparity and inequality between the more educated and less educated members society. 

Exploitation of workers

Globalization can lead to an environment that exploits workers in countries that do not offer sufficient protections.

Globalisation and employment: impact on job earning 

It allows trade liberalisation, which in turn encourages entrepreneurship and allows business owners to earn more. The increasing overall efficiency of the economy allows companies and employers to pay there workers more.

Globalisation has had both positive and negative impacts on employment:

Positive impacts

Job opportunities; globalization has increased the number of job opportunities, and the employment-to-population ratio.

Technology;

Globalisation has led to the rapid adoption of new technologies.

Internationalisation;

Companies with global operations have internationalised production.

Income disparity;

Globalization has helped reduce global income disparity.

Negative impacts

Job loses; 

Globalisation has increased competition between companies, which can lead to job loses.

Offshoring;

Companies may relocate to other countries or offshore job.

Wage inequality;

Globalisation has increased wage inequality, particularly in developing countries.

Migration; 

Globalisation has increased migration rates and brain drain in developing countries.

Hidden unemployment;

Globalisation can lead to hidden unemployment.

Real wage rates;

Globalisation can lead to a deterioration of real wage rates.

Globalisation has had a positive impacts on employment in many countries including:

China

Has benefited greatly from globalization

Vietnam

Globalisation has helped poor rice farmers by increasing rice prices. International trade has also created jobs in the manufacturing sector, with women being the primary beneficiaries.

Eu

In 2019, more than 38 million jobs in the EU were supported by exports to other countries. These jobs are often well-paid and include jobs in firms that supply goods and services to exporting companies.

 Pakistan 

Globalisation has positively affected employment shifts in the services sector.

Globalisation can have a  positive impact on employment in low and middle-income economies more than in high-income economies. It can also increase female labour force participation by creating new employment opportunity. However, some are argue that globalisation lowers women's chances of getting high-status, profitable jobs. 

Globalisation can impact employment in different ways across countries, depending on the labour market structure and the sector of the economy: 

Countries with flexible wages

In countries like the United States and the United Kingdom where wages are flexible, the decline in demand for less-skilled labou has led to lower wages for those workers.

Countries with rigid wages

In countries like France Germany and Italy where wages are rigid the decline in demand for less-skilled labour has led to lower employment for those workers.

Sector with low skilled jobs

In the European Union, sectors with low-skilled jobs, such as textiles, clothing, footwear, leather, basic metals, and fabricated metal products, are most vulnerable to job displacement.

Adjustment period 

The time it takes for workers to relocate to other sectors can undermine the initial benefits of international trade liberalisation.

The European globalisation adjustment fund was created in 2006 to help workers who lose jobs due to globalization. The fund provides support for re-employing workers our creating businesses