Half a billion unemployed or underemployed worldwide: UN report

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Insufficient paid work affects almost half a billion people.

A new United Nations report shows more than 470 million people are unemployed or underemployed globally. The report said a lack of access to decent jobs is contributing to social unrest — and warns that worse is to come.

A lack of decent work combined with rising unemployment and persisting inequality is making it increasingly difficult for people to build better lives through their work, according to the latest edition of the ILO’s global report on employment and social trends.

The global unemployment rate remained relatively stable during the 2010s, according to the report. But the global unemployment rate is expected to rise by 2.5 million in 2020, from 188 million to 190.5 million people.

In work poverty 630 million people on less than £2.40 per day

The ILO report highlighted that more than 60% of the global workforce currently work in the informal economy, often toiling for substandard wages and lacking basic social protections.

And in 2019, more than 630 million people – a fifth of the global working population – lived in so-called working poverty, meaning they made less than £2.40 per day in purchasing power.

At the same time, the ILO report warned of significant income and job access inequality, driven by things like gender, age and geographic location.

“For millions of working people, it is becoming increasingly difficult I think to build better lives through work,” ILO chief Guy Ryder told reporters in Geneva.

The annual World Employment and Social Outlook report stressed not only the unemployed but also the underemployed. Some 285 million people worldwide are considered underemployed, meaning they either work less than they want to, have given up searching for work or otherwise lack access to the labor market.

The figure of 470 million represents around 13% of the global labor force, the report said.

Is social unrest linked to unemployment rates?

The link between social unrest and unemployment and underemployment is a key part of the new report.

“Labor market conditions are contributing to this erosion of social cohesion in many of our societies,” said Ryder, referring to mass demonstrations in places like Lebanon and Chile.

According to the ILO’s “social unrest index,” measuring the frequency of things like demonstrations and strikes, there was an increase both at the global level and in seven out of 11 regions between 2009 and 2019.

The figure of 267 million young people between the ages of 15 and 24 not in employment, education or training may be a key factor in this. Many young people in employment endure substandard working conditions.

The report also reiterated the vast inequality between the world’s highest and lowest earners. Female participation in the workforce remained at 47%, 27 percentage points below the male figure.

“We are not going where we want to go,” Ryder said. “The situation is worse than we previously thought.”

Moderate or extreme working poverty is expected to edge up in 2020-21 in developing countries, increasing the obstacles to achieving Sustainable Development Goal 1  on eradicating poverty everywhere by 2030. Currently working poverty (defined as earning less than US$3.20 per day in purchasing power parity terms) affects more than 630 million workers, or one in five of the global working population.

Other significant inequalities – defined by gender, age and geographic location – remain stubborn features of current labour markets, the report shows, limiting both individual opportunities and general economic growth. In particular, a staggering 267 million young people (aged 15-24) are not in employment, education or training, and many more endure substandard working conditions.

We will only find a sustainable, inclusive path of development if we tackle these kinds of labour market inequalities and gaps in access to decent work.

Stefan Kühn, lead author

The report cautions that intensifying trade restrictions and protectionism could have a significant impact on employment, both directly and indirectly.

Looking at economic growth, it finds that the current pace and form of growth is hampering efforts to reduce poverty and improve working conditions in low-income countries. The WESO recommends that the type of growth needs to shift to encourage higher-value added activities, through structural transformation, technological upgrading and diversification.

“Labour underutilization and poor-quality jobs mean our economies and societies are missing out on the potential benefits of a huge pool of human talent,” said the report’s lead author, Stefan Kühn. “We will only find a sustainable, inclusive path of development if we tackle these kinds of labour market inequalities and gaps in access to decent work.”

The annual WESO Trends report analyses key labour market issues, including unemployment, labour underutilisation, working poverty, income inequality, labour income share and factors that exclude people from decent work.

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