ILO says enterprises and workers face tough environment

Weaker than expected growth will further affect the global employment situation, though some countries have proved more resilient than others, the ILO Director-General told the UN agency’s Governing Body.

Audio | 28 October 2013
ILO Director-General Guy Ryder has warned that IMF figures showing slower than anticipated economic growth reflect the difficult environment faced by enterprises and workers.

Speaking at the 319th session of the ILO’s Governing Body, Guy Ryder pointed out that unemployment is at record levels and wages are declining in a number of industrialized countries, while underemployment, informal work and lack of social protection is a significant phenomenon in many developing economies..

Household consumption and private investment remain low, and the public sector is under pressure to reduce fiscal deficits.

“In this context, many countries are trying to boost exports as a way to compensate for weak domestic consumption and investment. But with weak global demand this is inevitably a zero sum game with some countries’ export gains mirrored in other countries’ losses. That strategy on its own is simply a dead end for the global economy. We need growth of demand as well, and the entire economic pie, not competition over ever-smaller shares of it.”

The current trends will further affect the global employment situation, and youth unemployment is expected to remain high in most regions.
But there are some positive developments.

“A number of emerging and developing countries have shown more resilience to external developments than was the case in earlier crises. This has been due to several factors, including careful macroeconomic management, the extension of social protection floors, and their fast-growing business environments. And in Europe, some of the hardest hit countries may be beginning to grow again, although, we have to recognize, from a very low base and with continuing high levels of unemployment.”

Guy Ryder also welcomed what he said was growing awareness of the importance of a greater focus on job-centred strategies, citing Latin America, the United States and Japan, which have included employment as a goal for monetary policy.

Patrick Moser at the ILO