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Key Indicators of the Labour Market 2015

Workers are becoming more educated, although not always finding suitable jobs

The new edition of the ILO online reference tool analyses the link between education and access to the labour market.

News | 16 November 2015
Where are educated workers at greatest risk of being unemployed?
GENEVA (ILO News) – The educational level of the labour force is improving worldwide but access to a higher education is not leading to lower unemployment at the global level, says the 9th edition of the ILO’s “Key Indicators of the Labour Market” (KILM).

According to the latest edition of the KILM, which is part of the broader ILO statistical database (ILOSTAT), all but two of 64 countries with available data have registered an increase in the share of the labour force with a tertiary education over the past 15 years. The biggest increases were seen in Canada, Luxembourg and Russia.

At the same time, there has been a drop in the share of labour market participants with only a primary-level education or less.

Where does higher education translate into higher productivity?
“This is a positive development for these individuals, as more educated workers tend to benefit from higher earnings and better working conditions,” says Steven Kapsos, head of the ILO’s Data Production and Analysis Unit in the ILO Department of Statistics. “But it is also a positive development at the national and global levels, as there is a strong correlation between educational levels of the workforce and national levels of labour productivity.”

However, this does not mean that workers with tertiary-level education automatically have a better chance of finding a job. While they are less likely to be unemployed in most high-income economies, tertiary graduates in low- and lower-middle-income economies are actually more likely to be among the unemployed than workers with lower educational levels.

“This reflects a mismatch between skilled persons and the number of available jobs matching their competencies and expectations, and unless addressed may work to put a limit on economic growth and development,” says Rosina Gammarano, from the ILO Department of Statistics.

Youth employment and gender gap

© UN photo
The KILM also provides data on the share of youth who are not in education, employment or training (NEET), one of the proposed indicators that will be used for monitoring the 2030 Sustainable Development Agenda under its goal 8 and its particular target onto monitor Goal 8 of the 2030 Sustainable Development Agenda, and in particular, a targeted reduction in NEETs.

The KILM finds that the countries where the number of NEETs has increased in recent years are all high-income economies that were badly hit by the global financial crisis, such as Cyprus, Ireland, Italy, Greece and Spain.

On the other hand, the countries in which the share of NEETs decreased the most are either upper-middle-income economies, like Bulgaria, or low-income countries, like Cambodia.

There is also a persistent gender gap in the majority of developing countries with available data, with the percentage of young women NEETs reaching more than 40 per cent in Egypt, for example, compared to 17.3 per cent for young men.

The current edition includes four indicators that directly examine the link between education and labour markets.

The KILM is a multi-functional research tool of the ILO produced by its Department of Statistics, consisting of country-level data on 17 key indicators of the labour market from 1980 to the latest available year (See “Other key findings”). It was first released in 1999 and it is continuously reviewed and enhanced.

“This edition of the KILM – part of ILOSTAT – is particularly relevant now as national statisticians and the international organizations are in the process of establishing a statistical system to monitor the recently adopted Sustainable Development Goals. Many KILM indicators are strong candidates to become part of the set of indicators that will be used to measure the SDGs. Enhancing them will surely help to provide reliable benchmarks to monitor progress,” says Rafael Diez de Medina, Director of the ILO Department of Statistics.

Other key KILM findings

  • The median unemployment rate across 112 countries with comparable KILM unemployment rate data increased from 6.4 per cent in 2007 to 7.2 per cent in 2014.
  • The average worker in a high-income country currently produces 62 times the annual output of an average worker in a low-income economy and 10 times that of an average worker in a middle-income economy.
  • However, middle-income economies have registered the fastest productivity growth over the past 15 years.
  • Manufacturing employment in high-income economies has declined by 5.2 million since 2000, while it grew by 195 million in middle-income economies.
  • As of 2015, 72 per cent of workers in the world are employed in middle-income economies, 20 per cent in high-income economies and 8 per cent in low-income countries.
  • The number of working poor (living on less than US$2 per person, per day) declined by 479 million between 2000 and 2015. Virtually all of the decline was in middle-income countries.
  • The 9th edition of the KILM includes the first-ever estimates of the size of the labour force (employed + unemployed) across different income classifications, making it possible to determine the percentage of workers throughout the world that are in high-income, low-income, lower-middle income and upper-middle income economies.