World faces 600 million jobs challenge, warns ILO
The world faces the “urgent challenge” of creating 600 million
productive jobs over the next decade in order to generate sustainable
growth and maintain social cohesion, according to the annual report on
global employment by the International Labour Organization (ILO).
“After three years of continuous crisis conditions in global labour
markets and against the prospect of a further deterioration of economic
activity, there is a backlog of global unemployment of 200 million,”
says the ILO in its annual report titled “Global Employment Trends 2012:
Preventing a deeper jobs crisis”. Moreover, the report says more than
400 million new jobs will be needed over the next decade to absorb the
estimated 40 million growth of the labour force each year.
The Global Employment Trends Report also said the world faces the
additional challenge of creating decent jobs for the estimated 900
million workers living with their families below the US$ 2 a day poverty
line, mostly in developing countries.
“Despite strenuous government efforts, the jobs crisis continues
unabated, with one in three workers worldwide - or an estimated 1.1
billion people - either unemployed or living in poverty”, said ILO
Director-General Juan Somavia. “What is needed is that job creation in
the real economy must become our number one priority”.
The report says the recovery that started in 2009 has been
short-lived and that there are still 27 million more unemployed workers
than at the start of the crisis. The fact that economies are not
generating enough employment is reflected in the
employment-to-population ratio (the proportion of the working-age
population in employment), which suffered the largest decline on record
between 2007 (61.2 percent) and 2010 (60.2 percent).
At the same time, there are nearly 29 million fewer people in the
labour force now than would be expected based on pre-crisis trends. If
these discouraged workers were counted as unemployed, then global
unemployment would swell from the current 197 million to 225 million,
and the unemployment rate would rise from 6 percent to 6.9 percent.
The report paints three scenarios for the employment situation in the
future. The baseline projection shows an additional 3 million unemployed
for 2012, rising to 206 million by 2016. If global growth rates fall
below 2 per cent, then unemployment would rise to 204 million in 2012.
In a more benign scenario, assuming a quick resolution of the euro debt
crisis, global unemployment would be around 1 million lower in 2012.
Young people continue to be among the hardest hit by the jobs crisis.
Judging by the present course, the report says, there is little hope for
a substantial improvement in their near-term employment prospects.
Global Employment Trends 2012 says 74.8 million youth aged 15-24 were
unemployed in 2011, an increase of more than 4 million since 2007. It
adds that globally, young people are nearly three times as likely as
adults to be unemployed. The global youth unemployment rate, at 12.7 per
cent, remains a full percentage point above the pre-crisis level.
The report’s main findings also include:
* There has been a marked slowdown in the rate of progress in
reducing the number of working poor. Nearly 30 percent of all workers in
the world - more than 900 million - were living with their families
below the US$2 poverty line in 2011, or about 55 million more than
expected on the basis of pre-crisis trends. Of these 900 million working
poor, about half were living below the US$1.25 extreme poverty line.
* The number of workers in vulnerable employment globally in 2011 is
estimated at 1.52 billion, an increase of 136 million since 2000 and of
nearly 23 million since 2009.
* Among women, 50.5 percent are in vulnerable employment, a rate that
exceeds the corresponding share for men (48.2).
* Favourable economic conditions pushed job creation rates above
labour force growth, thereby supporting domestic demand, in particular
in larger emerging economies in Latin America and East Asia.
* The labour productivity gap between the developed and the
developing world - an important indicator measuring the convergence of
income levels across countries - has narrowed over the past two decades,
but remains substantial: Output per worker in the Developed Economies
and European Union region was US$ 72,900 in 2011 versus an average of
US$ 13,600 in developing regions.
“These latest figures reflect the increasing inequality and
continuous exclusion that millions of workers and their families are
facing”, said Somavia. “Whether we recover or not from this crisis will
depend on how effective government policies ultimately are. And policies
will only be effective as long as they have a positive impact on
The report calls for targeted measures to support job growth in the
real economy, and warns that additional public support measures alone
will not be enough to foster a sustainable recovery. “Policy-makers must
act decisively and in a coordinated fashion to reduce the fear and
uncertainty that is hindering private investment so that the private
sector can restart the main engine of global job creation”, says the
It also warns that in times of faltering demand further stimulus is
important and this can be done in a way that does not put the
sustainability of public finances at risk. The report calls for fiscal
consolidation efforts to be carried out in a socially responsible
manner, with growth and employment prospects as guiding principles.