Job guarantee

A job guarantee is an economic policy proposal that aims to create full employment and price stability by having the state promise to hire unemployed workers as an employer of last resort (ELR).^[1] It aims to provide a sustainable solution to inflation and unemployment.

The economic policy stance currently dominant around the world uses unemployment as a policy tool to control inflation. When inflation rises, the government pursues contractionary fiscal or monetary policy, with the aim of creating a buffer stock of unemployed people, reducing wage demands, and ultimately inflation.^[2] When inflationary expectations subside, expansionary policy aims to produce the opposite effect.

By contrast, in a job guarantee program, a buffer stock of employed people (employed in the job guarantee program) is typically intended to provide the same protection against inflation without the social costs of unemployment, hence potentially fulfilling the dual mandate of full employment and price stability.^[1]

^ ^a ^b Wray, L. Randall (23 August 2009). "Job Guarantee". New Economic Perspectives. Retrieved 31 July 2018.
^ corporateName=Commonwealth Parliament; address=Parliament House, Canberra. "Jobs Guarantee". www.aph.gov.au. Retrieved 6 April 2021.{{cite web}}: CS1 maint: multiple names: authors list (link)

[ref1-1] Wray, L. Randall (23 August 2009). "Job Guarantee". New Economic Perspectives. Retrieved 31 July 2018.

[corporateName=Commonwealth_Parliament;_address=Parliament_House-2] rporateName=Commonwealth Parliament; address=Parliament House, Canberra. "Jobs Guarantee". www.aph.gov.au. Retrieved 6 April 2021.{{cite web}}: CS1 maint: multiple names: authors list (link)

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