“Strong willingness to allow change to happen”
Boris Zürcher, Head of the Labour Directorate of the State Secretariat for Economic Affairs, forecasts a bright future for the Swiss: Institutions are ready for structural change to take place, and the young generation has a positive attitude.
BORIS ZÜRCHER, 54, is the Head of the Labour Directorate of the State Secretariat for Economic Affairs (SECO). He was previously a chief economist at the BAK research institute and the Avenir Suisse think tank and served as an advisor to three members of the Federal Council. After completing an apprenticeship as a technical draftsman, he took the alternative education route for his university entrance examination, where he studied economics and sociology. He has been a lecturer at the University of Berne since 2003.
Mr. Zürcher, an overwhelming majority of young people outside of Switzerland worry “that my job will not be needed in the future.” Are they right?
No, I do not believe that we will run out of work in the future. The fear that robots will take away our jobs is not a new phenomenon. It has not proven to be true as of yet, at least.
People are not as concerned in Switzerland. Why is that?
Especially here, the technological advancements of the last two decades have always contributed to continued job growth and rising prosperity. This was primarily possible because, time and time again, we allowed structural changes to take place and our institutions encouraged those changes. Furthermore – on societal, economic and political levels – we have a strong willingness to allow change to happen. As a result, we have low unemployment, jobs growth is stable, labor participation is high and wage trends are quite balanced and broadly supported.
You’ve said that the Swiss labor market has a “bright” future. What is your optimism based on?
Switzerland is currently benefiting from very favorable European and global economic growth. The economic recovery continued earlier this year as well, which translates into a positive impact on employment growth and a significant reduction in unemployment. And the recovery is likely to go on. The key indicators for the employment outlook and the jobs situation are at a consistently high level. These are all good reasons to consider the future to be bright.
While the majority of those surveyed in the US, Brazil and Singapore find the tech sector to be attractive, fewer than half of young people in Switzerland go into this field. Does this represent a problem for our future viability?
I don’t consider it to be a problem. Not everyone can or would like to become a tech specialist. True, for some time we have been seeing stronger demand for technically skilled specialists, for instance in the areas of information technology and communications technology. However,
that does not mean that the tech sector is the only one with a demand for highly trained specialists. People with artisanal and social skills are also in demand. In particular, many qualified specialists are needed in health care and in the education sector.
In Switzerland, only 39 percent want to start their own company – significantly less than in the other three countries – even though Switzerland is known as the land of the SMES! Why is entrepreneurship more popular in other countries?
Based on international comparisons, we know that young adults in Switzerland are not as involved in start-up activity on average. However, more companies are founded by people in the middle years of their working lives. This can be interpreted as a positive thing. Education is apparently the focus in the early years. Founding a company becomes relevant when the experience and skills have been established to allow that business to succeed in the marketplace.
For the first time, the youth have named the Federal Old Age and Survivors’ Insurance (AHV) as Switzerland’s biggest problem. Is that development due to the strong media coverage of this topic, or are young people actually worried about their retirement?
The public discussion leading up to the Retirement Provision 2020 referendum certainly contributed to the fact that the matter of retirement provision is receiving more attention even from young people. And yet this is not a case of an issue being temporarily hyped up. As a matter of fact, there is a pressing need to reform the AHV, as well as occupational pension provision. Excluding investment yields, AHV expenses have exceeded receipts for several years already. In light of this, it is certainly welcome news that the awareness of this problem is growing among the population and even more so among young people.
And how do we get them to begin saving right now?
We are well positioned with the threepillar system for retirement provision composed of AHV, occupational pension provision and individual savings. Those affiliated with a pension fund automatically build up retirement savings starting at 25 years of age, and that capital will later supplement the AHV pension. When the matter is considered from this perspective, the successful integration of young people into the labor market is extremely important. There are other reasons why this is a high priority, of course. Despite the tax incentives, individual retirement savings in the third pillar may not yet be quite on the radar for many young people. The important thing is that they behave responsibly overall. Depending on the situation, one Swiss franc spent on a person’s own education or further education is actually a better invest- ment in the long term than if it simply sat in a bank account.
For years, questions about foreigners have dominated the ranking in the Worry Barometer, and now these have lost significance, as has the refugee issue. Has the situation really improved?
In my interpretation, the approval of the mass immigration initiative shows that large parts of the population now have a sense of being heard. This is because the Federal Assembly also adopted measures aimed at slowing immigration. In addition, the migration balance has also recently trended downward, as has the number of asylum seekers. All of these developments have allowed the resentment surrounding this issue to dissipate somewhat. I assume that the topic would again become more relevant if immigration were to increase again.
Artisanal and social skills are also in demand.
According to those surveyed, the relationship between young foreigners and young Swiss people has improved significantly since 2010. How do you explain this?
When they come to Switzerland, young foreigners often encounter a social, cultural and societal environment that is completely new to them. Adapting to this new environment does not happen overnight. It is a process that takes time. The government takes a carrot and stick approach, supporting integration – through vocational education, for instance – and yet placing the burden of individual responsibility on foreigners. But integration is also a reciprocal process. The results of the survey seem to indicate that the shared responsibility is being borne by all parties involved.
You completed an apprenticeship as a technical draftsman. How do you explain to a foreign labor minister that it is not necessarily beneficial for a country to have as many young people as possible attend a university?
Two-thirds of the young people in Switzerland choose a basic vocational education. The dual-track vocational education system has a direct relationship to the working world. It is aligned with the actual professional skills that are in demand on the labor market. For this reason, Switzerland has one of the lowest youth unemployment rates compared to the other European nations.
Is Switzerland a model for the rest of the world?
I’m not so sure that our system can be simply copied wholesale over to another country. But other countries can certainly learn from the successful model in Switzerland and replicate individual elements of it.