What this lesson teaches
I can explain how globalisation creates both job opportunities and job challenges for individuals.
Syllabus K230, Issue 3, Guiding Question 2, Economic impacts of globalisation. Employment opportunities and challenges experienced by individuals
Make a guess
In 2020, COVID-19 stopped most air travel. What do you think happened to jobs at Singapore Airlines?
- It hired more staff to prepare for travel to restart.
- Little changed, because airlines keep their staff during a crisis.
- The group announced about 4,300 job cuts, around 20% of its staff.
Show the answer
The group announced about 4,300 job cuts, around 20% of its staff.
When overseas demand collapsed, firms that depend on it cut jobs, even for workers who did good work.
Globalisation can also cost jobs, as firms face overseas competition or move work abroad.
Picture a company that moves its booking service to an overseas office. Staff in Singapore lose those jobs, even though they did good work. Losing a job because the employer removes the role is called retrenchment. A change in how a business is organised changes which jobs exist.
International competition pushes firms to cut costs or change what they make. Some move work abroad to save money, reach new markets or find skilled workers. If overseas demand falls, firms that depend on it may cut hours, wages or jobs. Fewer hours mean lower weekly pay, even if the hourly rate stays the same.
The new jobs that appear may need different skills from the ones lost. Workers need time, training and support to move into them. Some cannot move to another city or country because of family, health or money. Losing a job does not show that a worker did not try.
Technology also changes work. Not every job lost to machines, or every local job loss, is caused by globalisation. In an answer, name the actual link: overseas demand, foreign competition or work moving abroad.
- Retrenchment
- Losing a job because the employer removes the role.
- Causes
- Overseas competition, work moving abroad, falling overseas demand.
Real examples to use
Singapore Airlines job cuts, 2020
When COVID-19 stopped most air travel, the Singapore Airlines Group announced about 4,300 job cuts, around 20% of its staff.
Jobs moving abroad
Some factory work has moved to countries with lower costs, so workers in those jobs need new skills to find other work.
Worked example: The reservation team moves abroad
A travel company combines its reservation teams in one regional office overseas, and its Singapore office closes. Lina has strong customer-service skills but cannot move abroad because she cares for a family member.
- Her job is lost because the work moved abroad.
- Her skills are not the problem.
- She may need job-search support or new skills to find a role in Singapore. It is not reasonable to assume she can simply move abroad.
Watch out for this
Workers who lose jobs because of globalisation must have refused to adapt.
Jobs can be lost through no fault of the worker, for example when work moves overseas. Skills matter, but so do vacancies, access to training, caring duties and whether people can move.
Check your understanding
A company moves its call centre overseas and its local staff are retrenched. What caused the job losses?
- The company relocated the work to cut costs or reach markets.
- New technology automated the calls, so the jobs were no longer needed.
- The workers did not perform well enough to keep their jobs.
Show the answer
The company relocated the work to cut costs or reach markets.
Right. Relocation, not the workers' performance, caused the losses.