No. 37




New Economy and Labour Market: Challenges to Labour Force

04 June 2018


RiTo No. 37, 2018

  • Aimar Altosaar

    Aimar Altosaar

    Project Manager, Estonian Center of Eastern Partnership; Editor of the column “Meie Eesti”, Postimees

The Estonian labour market is not ready for the coming of new economy. Labour market is shaped by legislation, employment mediation institutions, and the parties of work process with their attitudes, expectations and qualifications. In this article, new economy means ensuring high quality of life by spending as little resources as possible, increasing the value of human labour, and spreading of corporate responsibility, sharing economy, flexible working, and smart and individual work. The preconditions for new economy are robotisation, artificial intelligence and smart solutions in the whole economy.

Several categories of workers are excluded or even discriminated against, which is a sign of the unpreparedness of our labour market. Segregation of labour market into valuable and less valuable labour force considerably reduces the state’s ability to develop more competitive new economy.

The article discusses the exclusion of older middle-age people on the labour market, where age starts to have a negative impact already on the 45-year-olds. At the same, the average life expectancy in Estonia has increased to 83 years for women and 73 years for men, which means that for a large part of their lives, people may experience age discrimination, regardless of their qualification or earlier success as a qualified specialist.

One of the preconditions for new economy is the development of technology, which has reached the global top level in several sectors in Estonia. However, we have not amended the labour market regulations and institutions so that the whole society would gain from it. There is a widespread false belief that high-technology economy does not suit older people. It is becoming a new threat to older workers.

During the first half of 2018, Estonia has organised at least three conferences on the changes of labour market and economy. Increasingly more materials have been published in the media about the exclusion of older workers, and this topic is dealt with in TV programmes on society and economy. However, it has got no further than raising the issue, as the information received by the NGO Golden League Initiative shows that from a certain age (45–50 years), people are not invited to job interviews any more, and in the case of reorganisation of companies and agencies, people over 50 are the first to lose their jobs.  The author of the article has information that age discrimination also occurs in public sector regrettably often. Getting work in private enterprises is also complicated for older people, but a manager who is interested in profit usually does not turn away good workers.

The solution of the problem first of all depends on the political level and adjusting the goals of government agencies to the new needs. The public sector should be an example to the private sector, cooperate with interest protection associations, and investigate the situation more thoroughly in order to train managers and human resources specialists.

New economy needs experienced workers with different life and professional experience, which characterises the older generation. New economy will create possibilities for the emergence of totally new jobs and places of work, where social skills, empathy, calculated and resource efficient behaviour are considered valuable resources.