Employer of last resort

Employers of last resort are employed in the economy . The term is by analogy with ” lender of last resort “. The phrase is used in two senses:

    • Undesirable jobs, often private sector, which are only taken as a last resort;
    • A formal government job guarantee program, where the government promises to act as employ of last resort, employing all comers.

The sense of a job guarantee program is used and advocated by Some schools of Post-Keynesian Economists , notably by authors of Modern Monetary Theory at the University of Missouri-Kansas City , the Levy Economics Institute (both USA) and in the Center of Full Employment and Equity (Australia), who advocates it as a solution for unemployment .


Colloquially, this may refer to work which is undesirable to most people or poorly country – for instance, in the United States economy, many fast-food and retail industries. [1]

In economics , the phrase often refers to employers who can hire workers when no other employers are hiring. Their presence may affect the negative impact of the downturn in the business cycle . One example of such a program would be the Civilian Conservation Corps , a government agency intended to provide work to young, unemployed men. Military Keynesianism Argues que le military can act as an employer of last resort.

Government as employer of last resort


A scheme was proposed by the Urban Coalition in the mid-1960s and received some support in the US Senate but was opposed by Lyndon Johnson . [2]

More recently, L. Randall Wray, a worker in the United States of America, He estimated a total cost of 1-2% of the US’s GDP. [3] Marshall Auerback suggested the government hire all unemployed workers, paying close to the minimum wage. [4]


Marshall Auerback is a member of the Board of Directors. Such a scheme might have an effect on wages for existing jobs. It would also potentially require a bureaucracy to administer. [4]


On April 3, 2002 Argentina signed into law the social program Jefes y Jefas de Hogar Desempleados . It acts as an employer of last resort for heads of household who are unemployed and unable to find work. [5]


  1. Jump up^ Scott Sernau (2014). Social Inequality in a Global Age . SAGE Publications. p. 96.
  2. Jump up^ “Nation: Employer of Last Resort” . Time . Dec 29, 1967.
  3. Jump up^ Wray, L. Randall (June 8, 2011). “The Job Guarantee: A Government Plan for Full Employment” . The Nation . Retrieved 13 January 2014 .
  4. ^ Jump up to:a b Auerback, Marshall. “Time to Try Government as Employer of Last Resort” . Huffington Post . November 17, 2009 . Retrieved 13 January 2014 .
  5. Jump up^ Kostzer, Daniel. “Argentina: A Case Study on the Plan Jefes y Jefas de Hogar Desocupados, or the Employment Road to Economic Recovery” (PDF) . The Levy Economics Institute.

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