Much of the organisational strategies adopted in Jamaica, and the language associated with them, have been based on mimicking the business model developed in the metropole. We recall during the 1990s the buzz word was ‘down-sizing’ and later ‘right-sizing’, a process of restructuring for more efficient means of achieving greater profitability.
The philosophy of Peter Drucker, which ushered in the concept of human resource management, guided the new vision, mission and core values of many organisations in Jamaican. The business models of the metropole are invariably informed by rigorous academic research about ways to improve organisational efficiency through lowering costs for profit maximisation. Those objectives were achieved, at least until 2008 when, led by the financial sector, everything crashed.
Nonetheless, studies on how to improve workplace performance continued and at every stage seems to provide a rich inventory of practical and research-based ideas about workers’ motivation and engagement and their correlation to creativity and productivity. That was the approach adopted by Ricardo Semlar with his company Semco S.A. back in the 1990s, which led Fortune 500 CEOs at the time to fly their private jets to Brazil to see what accounted for the company’s rapidly improved sales and profit.
Ron Friedman’s 2014 classic on the ‘Best Place to Work’, offers an insight, informed by decades of psychological research, on how to move a company from ordinary to extraordinary by improving the well-being of workers and the quality of work. Sociology Professor Jennifer Glass, in a New York Times op-ed a couple of years back noted that “a workforce culture based on long hours at the office with little regard for family or community does not inevitably lead to strong productivity or innovation.”
With the debate raging about Artificial Intelligence and its adaptation, her comments become even more poignant where she asserted that “technology is great; it helps us do things more efficiently and cheaper. But it has also led to a breakdown in human interaction that is bad not only for humankind in general, but for business.”
The foregoing provides not only the backdrop, but the context in which I want to enter the debate about unemployment insurance (UI) and redundancy, and to ponder their likely impact on productivity and ultimately economic growth. The need to do so, of course, stems from the reasoning that if employers were to be ‘burdened’ with the cost of funding both UI and redundancy, then the added expense would negatively impact productivity and drive away foreign investments. Such reasoning, which appears informed by a philosophy of labour deeply rooted in our historical antecedents, and which can find no validation, in fact, is contradicted by the body of empirical evidence that correlates profitability with the manner in which workers are treatment at the workplace.
In a recent study on British manufacturing the conclusion was drawn that the less than extraordinary success in this sector was due partly to “a narrow obsession with direct labour and work practices.” This inevitably occurs where the worker is separated from his ‘being’, meaning he is seen as a mere factor of production beyond which his welfare and that of his family is of little or no interest to the employer outside of working hours. The truth is that when work is not acknowledged as crucial to a person’s dignity, well-being and development as a human being, then costs associated with labour will be viewed as a burden rather than an investment. This is why the International Labour Organisation (ILO) — to which the Jamaican Government, the employer and labour fully subscribe — some eight decades ago emphatically stated that “labour is not a commodity… “ and that it is “… not an inanimate product, like an apple or a television set that can be negotiated for the highest profit or the lowest price.”
The Labour Relations Code, governing workplace relationship between management and workers, argue for every employer to provide a pension scheme for their workers, and for work to be treated with dignity and respect. That extend to how as a society we treat not only our workers, but our retirees, children and the unemployed.
In a country facing an ageing population with under 20% of the employed labour force covered by some form of approved pension scheme, and from which they receive woefully inadequate pension benefits, economic growth and social stability are an unlikely outcome. In other words, the need for adequate pension benefits, unemployment insurance and redundancy form part of a social security system defined by the ILO and the United Nations as a basic human right. Social security, according to the ILO, “can contribute to social cohesion and to a country’s overall growth and development by bolstering living standards, cushioning the effects of structural and technological changes on people and thereby providing the basis for a more positive approach toward globalisation.” In middle-income countries like Jamaica social protection coverage generally covers between 20% and 60% of the population, while in most industrialised countries the coverage is close to 100%.
The recent COVID-19 crisis has exposed the gaps in existing social security arrangements, and studies done by the ILO, World Bank and the Economic Commission on Latin America and the Caribbean (ECLAC) have all pointed to the need for countries to build an adequate, sustainable and well-functioned social security system. This is not a case of “either or” when it comes to unemployment insurance and redundancy payments benefits, if we are serious about achieving the UN’s Sustainable Development Goals (SDGs) linking social protection with goals 1 through 17 to encompass all areas of economic and social development.
The fact is, the absence of unemployment insurance in the Caribbean is seen as “a major social protection gap”. Barbados and The Bahamas are the only two countries in the region with unemployment insurance, along with redundancy benefits, and can boast GDP per capita of US$17,339 and US$31,458 respectively, with corresponding growth rates, in the case of Barbados of 4.4% and The Bahamas of 4.3% in 2023, both figures significantly higher than Jamaica’s GDP per capita at US$6,041 and growth rate of 2.6% for 2023 according to World Bank statistics.
The ILO, the World Bank, ECLAC and other research-based institutions have provided the evidence that link a robust and comprehensive social security system (UI, redundancy, etc.) to positive and sustainable macro-economic outcomes. And even while we recognise that ‘the whole is greater than the sum of its parts’, it would be a useful exercise for workplace research-based studies to be conducted to see whether causality exists between the ‘alienation in the institution of labour’ and Jamaica’s less than stellar economic performance when compared to Barbados and The Bahamas.
At the uppermost of Fortune magazine’s top 100 Best Companies to Work, Friedman, concluded that “for many companies on Fortune’s list, the basis calculus is simple: Happy employees mean bigger profits.” That happiness, I submit, is achieved by removing notions of commodification and alienation of labour by making labour natural and inseparable from the human person. That’s what the benefit of a comprehensive social security system would undoubtedly achieve.
