Sixth annual “1+6” Roundtable Dialogue

Social and labour policies crucial for China’s move to high-income status

ILO Director-General, Guy Ryder, praises China’s focus on high quality growth, people-centred development, quality jobs and a greener economy in its five-year plan. He was speaking at the "1+6 Roundtable Dialogue’ on Promoting Strong, Inclusive and Sustainable Growth of the World Economy: From Recovery to Restructuring”, hosted by Chinese Premier Li Keqiang.

Statement | 06 December 2021
Thank you very much Premier Li,

Thank you for convening again this most valuable annual exchange.

When we met last year, the prospects of COVID-19 vaccines were giving rise to a wave of optimism. And indeed, since then, global economic growth has generally picked up. But today we’re not where we were hoping to be last year – and that applies to labour markets in particular.

Overall recovery in hours worked is flat-lining significantly below pre-pandemic levels; and as we have heard, there is a “great divergence” between developed and developing countries, and increased inequalities within and between countries.

The recovery is incomplete, uneven and fragile.

The ILO estimates that global hours worked in 2021 will be 4.3 per cent lower than pre-pandemic levels, which is equivalent to the loss of 125 million full time jobs in the world.

High-income countries and indeed China have experienced a strong, but incomplete, recovery. But low- and lower-middle-income economies continue to suffer much greater setbacks.

As a result, the number of people employed and participating in the labour force has not fully recovered and “labour market slack” remains very significant in many countries. Young people, especially young women, continue to face greater employment deficits.

Fiscal stimulus packages continue to be a key tool to support the recovery. But the fiscal stimulus gap in developing countries remains for the most part unaddressed.

In addition slow and highly unequal vaccination progress, compounded by additional downside risks including debt distress and global supply chain bottlenecks, are hindering recovery in low- and middle-income countries.

Mr Premier,

The longer the crisis lasts, the greater its disruptive force will be on the fundamental building blocks of development and economic and social progress: employment; skilling, reskilling and up-skilling opportunities; work-life transitions; decent working conditions; and adequate social protection - with all of the contributions to productivity growth, purchasing power and other improvements in supply and demand that these bring.

This year Governments, workers and employers at the International Labour Conference unanimously adopted a Global Call to Action for a human-centred recovery from the COVID-19 crisis that is inclusive, sustainable and resilient. Its ambition is to address increasing inequalities and to stimulate urgent action to create decent work, in particular full and productive employment and universal social protection.

Obviously, implementing the Global Call to Action will require significant financial resources.

In recognition of that need, the UN Secretary-General launched a Global Accelerator for Jobs and Social Protection to Facilitate a Just Transition during the UN General Assembly in September 2021. It is an initiative entirely compatible with the proposal for a Global Development Initiative made by President Xi, also at this year’s General Assembly.

The UN Global Accelerator has the ambition of creating 400 million decent jobs – including in the green and care economies – and to extend social protection coverage to the 4 billion people globally who are currently excluded.

We hope that all the organizations around this virtual table will be able to support the Accelerator. And to that end, the ILO Governing Body last month agreed to organize, at the end of February 2022, a Multilateral Policy Forum to promote joint initiatives and enhanced institutional arrangements between our organizations.

Turning now to China, let me say firstly that the 14th five-year plan resonates strongly with the ILO’s own priorities, with its emphasis on high quality growth, people-centred development, quality jobs and a greener economy.

The next five years will be crucial for China’s move up from upper middle-income to high-income country status. I would like to emphasize the key role that social and labour policies will play in this process.

At this critical stage, China would benefit by further expanding domestic consumption through increasing the real wages of its workers. So I am glad to see the plan’s emphasis on the need for growth of disposable incomes and a fairer distribution mechanism, as well as universal coverage of multi-tiered social security, and the creation of quality jobs.

In that regard, while innovation and new technologies certainly offer new employment opportunities, they can also exacerbate the inequality that has emerged in China as a by-product of decades of fast growth.

So we take positive note of China’s ambition to reduce inequalities and imbalances in the five-year plan and to share prosperity. The ILO stands ready to offer its expertise to address such challenges.

Other advanced countries’ historical experience clearly shows that supporting the rise of workers in manufacturing and service industries to middle income status is a key feature in economic development. China’s ambitious plan for creation of a high-quality workforce through large scale upskilling and training will be fundamental to that end.

In addition, China can benefit from continuing its efforts to improve laws and policies to provide better labour and social protection for workers, particularly, vulnerable workers and those in new forms of employment, such as in the platform economy. So I am particularly pleased that China is considering drafting a Labour Standards Act, to extend equal protection to all workers, including gig workers and those in new forms of employment.

At the same time, collective consultation and bargaining, particularly on wages at enterprise and regional-sectoral level, will be vital for improving conditions of work, including higher wages in tandem with higher productivity.

That would contribute not only to boosting domestic consumption and productivity, but also to creating an improved workplace environment, addressing the demographic challenges of a rapidly ageing society, and achieving just transition for a greener economy, about which my colleagues have spoken at length.

Premier Li, colleagues,

This brings me back to the Multilateral Policy Forum that the ILO is organizing next February.

One of our goals is to see how, together, the multilateral organizations can promote and support additional investments for just transition to carbon-neutral jobs, and for productive employment and social protection in low- and middle-income countries. This will take both domestic resource mobilization and additional international financial resources, in combination with technical assistance.

We need to do this, because if we fail, the post-COVID-19 world risks being poorer and more unequal. And therefore less stable, and less environmentally sustainable.

That would not be the world we all wanted when this crisis struck and when we spoke of recovering “better”. We must therefore work together to achieve those ambitions.

Let me conclude by congratulating China on hosting the BRICS Summit again next year. It will be a further opportunity to promote a human-centred recovery among the largest emerging economies. And as regards the BRICS labour agenda, the ILO stands ready as ever to furnish its expertise at your request.