ILO releases Global Employment Trends 2007: East Asian unemployment up, despite strong economic growth

The number of people unemployed worldwide remained at an historic high in 2006, despite strong global economic growth

Press release | BANGKOK | 25 January 2007

BANGKOK(ILO News) –The number of people unemployed worldwide remained at an historic high in 2006, despite strong global economic growth, the International Labour Office (ILO) said in its annual Global Employment Trends,released today.

In East Asia[1], despite regional GDP growth of more than 8 per cent – the highest in the world - the total number of unemployed people increased in 2006 by more than the previous year, and the unemployment rate rose 0.1 per cent to 3.6 per cent.

 Worldwide, the unemployment rate stood at 6.3 per cent in 2006, a decrease of 0.1 per cent on 2005. Even though more people in the world are working than ever before the global number of people unemployed remains at an all time high of 195.2 million.

In East Asia the employment-to-population ratio, the share of the working-age population that is employed, has fallen sharply over the past decade – from 75.1 per cent in 1996 to 71.6 per cent in 2006.  Yet this share remains the highest in the world (the global average is 61.4 per cent) and significantly higher than the rates in South East Asia and the Pacific (66.1 per cent) and South Asia (56.5 per cent).  The decrease observed in East Asia is mainly the result of young people getting more and better education.

These trends have also been backed by a substantial decline in poverty and working poverty. In East Asia the number of working poor—those working but living with their families on less than the equivalent of US$ 2 per person, per day— fell to 347 million or 44.2 per cent of those in work. 10 years ago the percentage was 61.9 per cent, or 442 million. Globally the proportion was 47.4 per cent 2006.

Worldwide, the ILO found only modest gains have been made in lifting some of the world’s 1.37 billion working poor out of poverty, stressing that there weren’t enough decent and productive jobs to raise them and their families above the US$ 2 poverty line.

The report says East Asia is on its way to becoming a middle-income region, but stresses that new challenges are emerging as the region gets wealthier. These include:

  •  Rising inequality in incomes and access to basic services such as education.

  •  The need for better skills and a smother transition from school to work

  •  Wage growth is not matching productivity gains.

  •  Other aspects of the decent work equation are not keeping up with economic advancement. Average working hours exceed 50 per week in some countries, and safety and health, rights at work and social dialogue have not progressed significantly throughout much of the region.

  • Women continue to face more difficulties in labour markets than men.

Generally, the report says that to maintain or cut unemployment the link between growth and jobs must be reinforced. It says the creation of decent and productive jobs—not just any jobs— is a prerequisite for reducing unemployment and slashing the number of families working but still living in poverty. This in turn is a precondition for future development and economic growth.

Other findings include:           

  •  In most regions unemployment rates did not change markedly between 2005 and 2006.

  •  For the last decade economic growth has been reflected more in rising levels of productivity and less in growing employment. While world productivity increased by 26 per cent since 1996, the global number of those in employment rose by only 16.6 per cent.

  • Unemployment hit young people (aged 15 to 24) the hardest, with 86.3 million young people representing 44 per cent of the world's total unemployed in 2006.

  • The employment gap between women and men persists. In 2006 only 48.9 per cent of women aged 15+ were working compared to 49.6 per cent in 1996. The comparable male employment-to-population ratios were 75.7 in 1996 and 74.0 in 2006.

  •  In 2006 the service sector’s share of global employment overtook agriculture for the first time, increasing from 39.5 per cent to 40 per cent. Agriculture decreased from 39.7 per cent to 38.7 per cent. The industry sector accounted for 21.3 per cent of total employment.

“Every region has to face major labour market challenges”, says the ILO report.  “Young people have more difficulties in labour markets than adults; women do not get the same opportunities as men, the lack of decent work is still high; and the potential a population has to offer is not always used because of a lack of human capital development or a mismatch between the supply and the demand side in labour markets.”

“Nowadays the widespread conviction is that decent work is the only sustainable way to reduce poverty, which is why the target of ‘full, productive and decent employment’ will be a new target within the Millennium Development Goals in 2007. Therefore it is now the time for governments as well as the international community to make sure that the favourable economic conditions in most parts of the world will be translated into decent job growth,” the report concludes.

[1]China, DPR of Korea, Hong Kong (China), Macau (China), Mongolia, Republic of Korea, Taiwan, (China)

For more information please contact:

Sophy Fisher
Regional Information Officer
ILO Regional Office for Asia and the Pacific
Tel: +662 288 2482

Krisdaporn Singhaseni
Information Officer – ILO Bangkok
Tel: +66 (0) 2288 1664

Chen Qiaoling
ILO Beijing
Tel. 86-10-65325091