GENEVA (ILO News) – The Director-General of the International Labour Organization (ILO), Juan Somavia, has called for “decisive global cooperation” to tackle the massive jobs deficit and to avoid sliding into a possible recession.
In a statement issued to the International Monetary Financial Committee and Development Committee, Mr. Somavia warned that the world economy is again facing risks of a financial crisis and an economic recession which could further strain an already critical employment situation.
“The slowing down of the world economy now implies employment is growing at only 0.8 per cent, less than the increase in the labour force. This will lead to an increase in the number of unemployed, underemployed persons and persons living in hardship”, said Mr. Somavia.
“It would be a serious mistake to misread the critical moments we are living through as primarily a crisis of confidence of financial markets. On the contrary, there is a growing feeling in many quarters that our multilateral governance frameworks and even many national political systems are not coping well with the power of financial operators”, he added.
Mr. Somavia said the priority now was “to put in place policies and measures that stimulate investment in the real economy” and to carry out reforms to the global financial services industry that “are essential to reverse the dysfunctional policies that led to unsustainable debt-financed operations by governments, households and enterprises”.
Among other measures, Mr Somavia called for:
- Raising productive investments in the real economy;
- Supporting small-and-medium sized enterprises;
- Sustaining the incomes of working families;
- Promoting cooperation for the Global Jobs Pact 1
- Reforming the finance sector to better serve the real economy;
- Implementing socially responsible fiscal consolidation;
“This also requires recovering the dignity of work and investing in institutions of dialogue to deliver balanced solutions strengthening the prospects of the real economy. Determined global cooperation is urgent to tackle the global jobs deficit”, concluded Mr Somavia.
1 The Global Jobs Pact is a set of balanced and realistic policy measures that countries, with the support of regional and multilateral institutions, can adopt to ease the impact of the crisis and accelerate recovery in employment. Adopted in June 2009 by the International Labour Organization, it calls on its member States to put decent work opportunities at the core of their crisis responses.
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