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LAHORE: From the perspective of job creation and quality, experts advocate free trade in times of economic crisis. However, the main thrust should be on exports as, on average, exporters pay higher wages than domestic businesses, experts say.
“At a time of global economic uncertainty, the issue of trade and employment is becoming the focus of public debate — particularly with the constant news of large scale lay-offs,” said senior economist, Naveed Anwar Khan.
He warned that if this trend continued, there was the risk of increased calls for protectionism by domestic manufacturers. However, planners must bear in mind that when any country in history returned to protectionism, it experienced mass unemployment, inequality and greater conflict, he said.
Market analyst, Yunus Kamran, said “much of the pro-trade argument in the debate centers on the notion that trade creates jobs, which is sometimes misused by some who claim that if exports create jobs, then imports must cost them.” He said that they miss an important point. The main rationale for trade (both exports and imports) is that it improves overall productivity and international competitiveness of a national economy that helps lock-in low unemployment and long-term job security, said Kamran.
However, he conceded that exporters make better bosses on average – not only in Pakistan but around the world. Exporters pay their workers more than industries catering to the domestic market needs only, he said.
Leading exporter, M I Khurram, said that there was evidence at the micro level that exporters, on average, improve the quality of employment as they are innovative, invest in technology, education and training, and achieve higher levels of productivity and profitability — relative to domestic businesses.
“They certainly pay better in Pakistan, India or Bangladesh,” he said. In fact, exporters pay 30 to 40 percent higher wages than non-exporters, he added.
Engineering exporter, Almas Hyder, said the exporters achieve higher standards of occupational health and safety. “They are equal opportunity employers,” he said. Exporters provide better working conditions, he said. They follow all globally acceptable production, environmental and ethical practices, said Hyder. Non compliance with any of these practices results in immediate suspension of orders, he said.
Moreover, exporters now find that following global best practices results in better productivity and efficiency. The higher cost incurred on wages and facilities provided to the workers are not only compensated through high productivity but the profitability of firms also increases substantially.
“This is the reason that all exporting concerns that manufacture goods for domestic market as well are fast increasing their domestic share and sales,” said Hyder. He said trade is not a magic wand on its own. Openness is necessary but not sufficient for superior labour market outcomes.
“The main rationale for trade is that it improves the overall productivity and international competitiveness of a national economy,” he said.
“Having an open economy helps employment but countries still need social safety nets and labour market institutions that protect the bargaining power of the weak and help workers adjust to changes in the overall economy,” said Hyder.
“At a time of global economic uncertainty, the issue of trade and employment is becoming the focus of public debate — particularly with the constant news of large scale lay-offs,” said senior economist, Naveed Anwar Khan.
He warned that if this trend continued, there was the risk of increased calls for protectionism by domestic manufacturers. However, planners must bear in mind that when any country in history returned to protectionism, it experienced mass unemployment, inequality and greater conflict, he said.
Market analyst, Yunus Kamran, said “much of the pro-trade argument in the debate centers on the notion that trade creates jobs, which is sometimes misused by some who claim that if exports create jobs, then imports must cost them.” He said that they miss an important point. The main rationale for trade (both exports and imports) is that it improves overall productivity and international competitiveness of a national economy that helps lock-in low unemployment and long-term job security, said Kamran.
However, he conceded that exporters make better bosses on average – not only in Pakistan but around the world. Exporters pay their workers more than industries catering to the domestic market needs only, he said.
Leading exporter, M I Khurram, said that there was evidence at the micro level that exporters, on average, improve the quality of employment as they are innovative, invest in technology, education and training, and achieve higher levels of productivity and profitability — relative to domestic businesses.
“They certainly pay better in Pakistan, India or Bangladesh,” he said. In fact, exporters pay 30 to 40 percent higher wages than non-exporters, he added.
Engineering exporter, Almas Hyder, said the exporters achieve higher standards of occupational health and safety. “They are equal opportunity employers,” he said. Exporters provide better working conditions, he said. They follow all globally acceptable production, environmental and ethical practices, said Hyder. Non compliance with any of these practices results in immediate suspension of orders, he said.
Moreover, exporters now find that following global best practices results in better productivity and efficiency. The higher cost incurred on wages and facilities provided to the workers are not only compensated through high productivity but the profitability of firms also increases substantially.
“This is the reason that all exporting concerns that manufacture goods for domestic market as well are fast increasing their domestic share and sales,” said Hyder. He said trade is not a magic wand on its own. Openness is necessary but not sufficient for superior labour market outcomes.
“The main rationale for trade is that it improves the overall productivity and international competitiveness of a national economy,” he said.
“Having an open economy helps employment but countries still need social safety nets and labour market institutions that protect the bargaining power of the weak and help workers adjust to changes in the overall economy,” said Hyder.
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