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‘Decent work’ might sound like a grade my husband gives when he is marking his students’ papers, but it has a far wider reaching meaning than that. It involves opportunities for work that is productive and that delivers a fair income, security in the workplace and social protection.
During the UN General Assembly in September 2015, decent work and the four pillars of the Decent Work Agenda – employment creation, social protection, rights at work, and social dialogue – became integral elements of the new 2030 Agenda for Sustainable Development. But, as with a lot of things, it faced a set-back due to Covid.
The equivalent of 255 million full-time jobs have been lost in the pandemic – about 4 times the number lost during the Global Financial Crisis in 2007 – 2009*. Workers in informal employment have been most at risk, as they lack protection against illness or lockdowns. As they make up much of this part of the workforce, women and younger people have been particularly affected.
“Decent work is at the heart of the search for dignity for the individual, stability for the family and peace in the community.” — Juan Somavia, former Director-General of the International Labour Organisation
The aim of the UN’s Sustainable Development Goal #8 is to promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. The overarching goal is to sustain 7% gross domestic product (GDP) growth per year in the least developed countries. The goal also has six gender-specific indicators that relate directly to women including full and productive employment for all women and men, young people and persons with disabilities, and equal pay for work of equal value by 2030.
It’s no surprise the pandemic has had serious repercussions for the working lives of millions of people, but it’s also served as evidence for the continued deterioration of job security – ask any P&O employee!
It has also served to reinforce gender inequalities at home and in the labour markets. We’ve discussed previously the unequal division of labour between women and men during the pandemic as women have been the ones who have needed to take a step back in their professional lives in order to meet their family’s responsibilities.
According to the UN, women’s employment fell by 4.2% globally compared with 3% for men between 2019 and 2020**. In fact, the number of employed women declined by 54 million in 2020 and 45 million women left the labour market altogether**. These numbers are a combination of direct COVID influences like furlough and the fact that women are overrepresented in high-risk sectors, and secondary responses such as women leading the ‘Great Resignation’.
Worldwide, young women are twice as likely as young men to be jobless and not engaged in education or training*. Investors can do their bit by investing in companies that focus on educational attainment and learning (UN SDG 4) — both crucial for decent employment.
Another way investors can help address low quality employment and working conditions is by investing in companies that aim to make workplaces safer. Mike Sell, manager of Alquity Indian Subcontinent, told me clear standards in relation to health and safety at work are a key part of Alquity’s engagement with companies.
He said: “For companies in high-risk sectors (mining, shipping, chemicals) we only invest if they have published a health and safety policy and we check its implementation when possible during our site visits. We also engage with companies in sectors such as retail, so they can verify that human rights abuses such as child or forced labour are not present in their supply chains.”
And it’s not just in emerging markets where this is an issue. Amazon, the world’s largest retailer, will face a shareholder vote calling for an independent audit of its treatment of warehouse workers after the top U.S. securities regulator turned down the company’s request to skip the resolution.
The company has drawn increasing criticism in recent years for its treatment of workers, including claims of poor working conditions at its warehouses and its attempts to block workers unionising.
The Schroder Digital Infrastructure fund also maps all its holdings back to a UN SDG. As of March 2022, 100% of the fund’s portfolio could be primarily mapped back to UN SDG 8: decent work and economic growth. As manager Tom Walker explained, “Digitisation is taking place across every sector, from medicine to manufacturing. Significant efficiencies can be generated using ever growing data sets leading to economic growth and new opportunities for workers.
“Whichever sector you look at, the crucial links are the same – macro towers, fibre and data centres. These three assets are key to every form of digital communication. It is inevitable that the world will become more and more connected each year. As every element of the economy digitises, this will lead to ever growing demand for Digital Infrastructure.”
The Artemis Positive Future fund also shares its asset allocation by UN SDG and currently has 4.9%*** invested in companies linked to decent work and economic growth.
Investors looking to help boost economic growth should be thinking across the whole SDG spectrum. As we’ve demonstrated throughout this series, the goals are intertwined at every level and achieving many of the UN’s objectives, including social inclusion (SDG 10), education (SDG 4), health and wellbeing (SDG 3) and a circular economy (SDG 12) would also go a long way towards supporting economic growth.
As highlighted by Tom Walker, decent work is equally as important in areas of infrastructure (SDG 9) and, by extension, clean energy (SDG 7) and sustainable cities (SDG 11). Additionally, workers particularly involved with informal employment, predominantly women, are at high risk of falling into poverty (SDG 1) as a result of loss of work.
*Source: UN Sustainable Development Goals, 2021 Report
**Source: UN gender snapshot report 2021
***Source: fund factsheet, 28 February 2022