The current global economic slowdown is likely to widen social and economic inequalities as more workers will be forced to accept lower quality, poorly paid jobs which lack job security and social protection, warned the International Labour Organization (ILO). The World Employment and Social Outlook: Trends 2023 (WESO Trends), released by the ILO on Monday, said the total working hours per person are still below pre-pandemic levels in Asia Pacific region.
The report projected that global employment growth will be only 1% in 2023, less than half the level in 2022. On the other hand, the global unemployment is slated to rise slightly in 2023, by around three million, to 208 million (corresponding to a global unemployment rate of 5.8%).
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“The moderate size of this projected increase is largely due to tight labour supply in high-income countries. This would mark a reversal of the decline in global unemployment seen between 2020-2022. It means that global unemployment will remain 16 million above the pre-crisis benchmark (set in 2019),” the ILO said.
In 2022, around 473 million people were interested in finding a job but did not have one. “This unmet demand for jobs includes the 205 million unemployed people and an additional 268 million who wanted employment but did not qualify as unemployed,” the report said.
The job quality also remains a key concern, according to the report. Maintaining that decent Work is fundamental to social justice, the report noted that a decade of progress in poverty reduction faltered during the COVID-19 crisis. “Despite a nascent recovery during 2021, the continuing shortage of better job opportunities is likely to worsen,” the study said.
Another major concern flagged by the ILO is the current slowdown, which means that many workers will have to accept lower quality jobs, often at very low pay, sometimes with insufficient hours. “Furthermore, as prices rise faster than nominal labour incomes, the cost-of-living crisis risks pushing more people into poverty. This trend comes on top of significant declines in income seen during the COVID-19 crisis, which in many countries affected low-income groups worst,” the report said.
Stagflation conditions too threaten productivity and labour market recovery, the report said. “The labour market deterioration is mainly due to emerging geopolitical tensions and the Ukraine conflict, uneven pandemic recovery, and continuing bottlenecks in global supply chains,” the report added. “Together, these have created the conditions for stagflation – simultaneously high inflation and low growth – for the first time since the 1970s,” it said.
The report said women and young people are faring significantly worse in labour markets. “Globally, the labour force participation rate of women stood at 47.4 % in 2022, compared with 72.3% for men. This 24.9 percentage point gap means that for every economically inactive man there are two such women,” the report said. Young people (aged 15–24) face severe difficulties in finding and keeping decent employment. “Their unemployment rate is three times that of adults. More than one-in-five – 23.5%– of young people are not in employment, education or training (NEET),” the report said.
Commenting on the report, ILO’s Director General Gilbert F Houngbo said the need for more decent work and social justice is clear and urgent. “But if we are to meet these multiple challenges, we must work together to create a new global social contract,” he said and added that the ILO will be campaigning for a Global Coalition for Social Justice to build support, create the policies needed, and prepare us for the future of work.
Richard Samans, Director of the ILO’s Research Department and report coordinator said the slowdown in global employment growth means that one should not expect the losses incurred during the COVID-19 crisis to be recovered before 2025. “The slowdown in productivity growth is also a significant concern, as productivity is essential for addressing the interlinked crises we face in purchasing power, ecological sustainability and human well-being,” he added.
