Global Employment Trends 2014

Working poverty reduction stalled

Working poverty dropped drastically over a decade, but progress stalled in 2013. Achieving further improvements requires moving workers out of informal, vulnerable work and ensuring they enjoy decent working conditions, according to the ILO’s Global Employment Trends 2014.

News | 21 January 2014
GENEVA (ILO News) – Worldwide working poverty dropped drastically over a decade but progress stalled in 2013, the ILO said in its Global Employment Trends 2014 report.

In 2013, an estimated 375 million workers lived on less than US$1.25 a day, compared to 600 million in the early 2000s – a 12 per cent drop per year, on average. But progress has stalled, and in 2013 the number of workers in extreme poverty declined by only 2.7 per cent globally.

This trend reflects a peak in vulnerable employment, which the ILO defines as the sum of own account workers and contributing family workers. The number of people in vulnerable employment expanded by around 1 per cent in 2013, well above the 0.2 per cent growth rates during the years prior to the financial crisis.

Where are the good jobs?

For many people in the developing world, vulnerable and informal jobs remain the only work available. In most cases, those jobs entail low pay, limited job security, poor working conditions and little or no social protection.

“Bringing more workers out of informality remains crucial in order to improve working conditions and generate tax revenues that governments need to strengthen social welfare systems. In this regard, further reductions in working poverty will be tightly linked to declining rates of informality,” the report, produced by the ILO’s Research Department says.

Informal employment remains widespread in most developing countries even though regional variations are sizeable. Informality rates are particularly high in South and South-East Asia, where they reach up to 90 per cent of total employment in some countries. Even though progress in reducing poverty has been strongest in these regions, a high incidence of informal employment is likely to constitute a barrier to a sustainable reduction in poverty.

“This clearly shows that the creation of decent jobs is the most pressing global development priority. It should be at the heart of the development agenda when the international community adopts new Development Goals for the post-2015 period,” said ILO Director-General Guy Ryder.

“Overcoming employment vulnerability and informality are key to overcoming poverty in a sustainable way.”

Share of extremely poor (less than $US 1.25 per day) in total employment

Source: Kapsos and Bourmpoula (2013)