Unemployment in Industrial Countries: A Danger to ASEAN?

Abstract

Full employment policies encouraged international and capital flow liberalization, enabling industrial countries to grow rapidly in the 1950s and 1960s and providing access to their markets to developing countries. The industrial countries' failure to adjust to rapid technological change, however, resulted in rising inflation and unemployment from the end of the 1960s. A wave of new protection against labour-intensive imports from developing countries followed in the 1970s. The growth of imports of clothing and textiles from ASEAN countries decelerated. Unemployment limited women's access to full-time work and was highly concentrated among young people, minority ethnic groups and older people. uFortress regionalism and calls for 'fair trade marked further protectionist reactions. Unemployment has become the industrial countries' principal economic problem. It is giving rise to political unrest in industrial countries and to difficulties in international that threaten the global trading environment. The growth of imports from developing countries, including ASEAN countries, and capital flows to them, have been reduced below their potential. The policy reforms being undertaken by most industrial countries are little and too late .