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October 17, 2017 | Global Equity
Searching for Signposts

Global Equity Strategist

Olga Bitel, partner, is a global strategist. She is responsible for economic research and analysis across all regions and sectors. She distills macroeconomic and geopolitical developments into actionable insights for global equity portfolios within a multifaceted strategic framework. In addition, she provides insights about cyclical turning points and structural trends as inputs into portfolio construction in predominantly bottom-up investment approaches. Before joining William Blair in 2009, Olga was a senior economist at the National Institute of Economic and Social Research in London, United Kingdom, where she produced macroeconomic forecasts for most Asian economies and led thematic research projects for some of the world’s best-known international organizations, including the Organization of the Petroleum Exporting Countries and the International Monetary Fund. Olga received a B.A. from the University of Chicago and an M.Sc. in economics from the London School of Economics and Political Science.

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In an earlier post, I explained that much of the urgency around the immigration debate has faded, but a number of factors could cause a resurgence of interest in the topic. What signposts can we look for to indicate that we’re crossing the final frontier of globalization?

As I previously explained, key to allowing for the movement of labor are policies that give individuals enough security to move around without the fear of losing their livelihoods—their jobs, their healthcare, their pensions.

So, in the United States, healthcare reform—to the extent that it allows for the portability of plans—could help induce more mobility.

We should also look for a debate on the need to change our education system to create nationally recognized accreditations so vocational skills are transferrable from state to state.

Other countries are heading in this direction. Germany has a vocational training program, for example, that offers an alternative to higher education. Youth join three-year programs that mix in-school and company-based training, and culminate in nationally recognized qualifications. It appears that France is seeking to follow suit.

Even here in the United States, private initiatives that allow for job portability are emerging. In Wisconsin, there is a pilot program under which local employers who are part of the same supply chain rotate workers so they can guarantee full employment year round, benefiting both the businesses and the workers,

France may offer the best indication of what we should look for to indicate that we’re crossing the final frontier of globalization.

Thus far, France may offer the best indication of what we should look for to indicate that we’re crossing the final frontier of globalization. Emmanuel Macron didn’t campaign on a message of protectionism. Indeed, shortly before the first round of elections, he spoke to a unionized workforce at a Whirlpool factory that was about to close.

Instead of saying what laborers wanted to hear—that their jobs would be safe—he suggested they start thinking about the transferability of their skills. Despite that unpopular message, Whirlpool plant workers voted for him.

Macron is also trying to revise more than 3,000 pages of labor rules that employers say discourage hiring by making it complicated and financially risky to dismiss workers. In late September, Macron signed five decrees overhauling France’s labor rules, which he wants to go into effect by year-end. Some of the largest and most influential unions were involved in discussions leading up to these changes.

In the end, France may end up with something similar to Scandinavia’s Flexicurity, which is very easy hiring and layoff procedures for companies with high unemployment benefits and retraining schemes for workers—enabling people to move in and out of jobs easily without jeopardizing their living standards.

 

Global Equity Strategist

Olga Bitel, partner, is a global strategist. She is responsible for economic research and analysis across all regions and sectors. She distills macroeconomic and geopolitical developments into actionable insights for global equity portfolios within a multifaceted strategic framework. In addition, she provides insights about cyclical turning points and structural trends as inputs into portfolio construction in predominantly bottom-up investment approaches. Before joining William Blair in 2009, Olga was a senior economist at the National Institute of Economic and Social Research in London, United Kingdom, where she produced macroeconomic forecasts for most Asian economies and led thematic research projects for some of the world’s best-known international organizations, including the Organization of the Petroleum Exporting Countries and the International Monetary Fund. Olga received a B.A. from the University of Chicago and an M.Sc. in economics from the London School of Economics and Political Science.

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