Global unemployment, decent work deficits to remain high in 2018 — ILO

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By Victor Ahiuma-Young

As the global economy recovers but with a growing labour force, global unemployment in 2018 is projected to remain at a similar level to last year’s, according to a new report by the International Labour Organisation, ILO.

Going by the World Employment and Social Outlook: Trends 2018, just released by the world body, the global unemployment rate has been stabilizing after a rise in 2016.

unemployment

It is expected to have reached 5.6 per cent in 2017, with the total number of unemployed exceeding 192 million persons.

The report noted that  the long-term global economic outlook remains modest despite stronger than expected growth in 2017, explaining that the positive trend between 2017 and 2018 is due mainly to the strong performance of labour markets in developed countries, where the unemployment rate is projected to fall by an additional 0.2 percentage points in 2018 to reach 5.5 per cent, a rate below pre-crisis levels.

In contrast, employment growth is expected to fall short of labour force growth in emerging and developing countries, but has nevertheless improved compared to 2016.

“Even though global unemployment has stabilized, decent work deficits remain widespread as the global economy is still not creating enough jobs. Additional efforts need to be put in place to improve the quality of work for jobholders and to ensure that the gains of growth are shared equitably,” ILO Director-General Guy Ryder said.

Vulnerable employment is on the rise and the pace of working poverty reduction is slowing.

The report highlights the fact that the significant progress achieved in the past in reducing vulnerable employment has essentially stalled since 2012.

This means that almost 1.4 billion workers are estimated to be in vulnerable employment in 2017, and that an additional 35 million are expected to join them by 2019. In developing countries, vulnerable employment affects three out of four workers.

On a more positive note, the report notes that working poverty continues to fall in emerging countries, where the number of people in extreme working poverty is expected to reach 176 million in 2018, or 7.2 per cent of all employed people.

“In developing countries though, progress in reducing working poverty is too slow to keep up with the expanding labour force. The number of workers living in extreme poverty is expected to remain stubbornly above 114 million for the coming years, affecting 40 per cent of all employed people in 2018,” explains ILO economist Stefan Kühn, lead author of the report.

The authors also highlight the fact that participation rates among women remain well below those for their male counterparts. Women are also more likely to face inferior quality of jobs and lower salaries.

Looking ahead, structural shifts and ageing will add further pressures on the labour market

Looking at shifts in the sectoral composition of employment, the report notes that service sector jobs will be the main driver of future employment growth, while agriculture and manufacturing employment continue to decline.

Since vulnerable and informal employment are prevalent in both agriculture and market services, the projected employment shifts across sectors may have only limited potential to reduce decent work deficits, if not accompanied by strong policy efforts to boost job quality and productivity in the service sector.

The report also looks at the influence of population ageing. It shows that the growth of global workforce will not be sufficient to compensate for the rapidly expanding pool of retirees. The average age of working people is projected to rise from just under 40 in 2017 to over 41 in 2030.

Main regional findings/Africa

Breaking down the report from different regions across the globe, the reports that in Northern Africa, the unemployment rate should decline from 11.7 per cent in 2017 to 11.5 per cent in 2018. The number of unemployed remains steady at 8.7 million amidst strong growth in the labour force. Globally, the region features the highest unemployment rate driven by large gaps for youth and women who are significantly over-represented among the unemployed.

But in Sub-Saharan Africa, the report shows that the unemployment rate is expected to reach 7.2 per cent, essentially remaining unchanged. The number of unemployed should increase by 1 million due to the region’s high levels of labour force growth. More than one in three workers is living in conditions of extreme poverty, while almost three out of four workers are in vulnerable employment.

Among others, the report shows that unemployment is likely to decline from 4.7 per cent in 2017 to 4.5 per cent in 2018 in Northern America, because of a decline in the unemployment rates in both Canada and the United States.

 

 

 

 

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