Social protection relates to the collective systems and rights created by states to support their citizens. It includes support for labour market risks, such as unemployment and occupational accidents; and also includes saving for retirement or training. Based on national circumstances, countries around the world have developed their own social protection systems. Often, workers and employers play a role in financing, managing and developing (sectoral) social protection schemes.
Most social protection systems were created and expanded in developed economies after the Second World War. Many were built to be supported by financial contributions as part of the employment relationship, and the open-ended contract in particular. As such, their (financial) fundament and business case is often based on different labour markets and social structures. As labour markets and societies evolve, social protection systems also need to adapt to sustain their support and added value for the people they aim to cover.
A key stake in this transformation is the development of social protection that is better tailored to the individual and the changing needs that people experience over the course of their (working) lives. Ensuring access to lifelong learning should be a key deliverable for social protection systems as jobs, labour market requirements and personal preferences will change more often.
Most of the global population isn’t appropriately covered by social protection; either because their government doesn’t provide it, or because they work in the informal sector where coverage is generally absent. Developing and expanding social protection schemes is a costly affair. Making them fit for purpose is therefore essential for their financial and societal sustainability.
The International Labour Organisation (ILO) and the World Bank have developed many policy initiatives related to social protection systems. Most of these are geared towards creating and expanding social protection in developing and emerging (labour) markets.
In developed economies, ensuring the (fiscal) sustainability of social protection systems is a growing focus. The work of both the OECD and EU is increasingly looking at social protection schemes in their member states and how they can adjust to changing societies and labour markets.
Modernising social protection schemes is a key recommendation from the World Employment Confederation’s Manifesto “No Future of Work without Social Innovation!”
Social Innovation means re-inventing social protection systems to place the individual, rather than a particular job or work relationship, at their core. Doing so allows people to make life transitions more easily and to tailor social support to their individual needs and situation.
Private employment services around the world are working with worker representatives, social security institutions, public employment services and governments to adapt social security and protection systems to a changing world of work and ensure that people build up rights and benefits across different life-phases, jobs, sectors and forms of work. For examples of how the private employment industry re-invents ways of providing social protection, visit our “Social Innovation Stories” database.