World employment report 2004-05.
Employment, productivity and poverty reduction.
Geneva, 2005

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Today there are 550 million people who work, but still live on less than US$ 1 a day. These "working poor" represent 20 per cent of total world employment. In spite of the record levels of global unemployment, the reality for most of the world’s poor is that they must work – often for long hours, in poor working conditions and without basic rights and representation – at work that is not productive enough to enable them to lift themselves and their families out of poverty. While it is clearly the case that employment is central to poverty reduction, it is "decent and productive" employment that matters, not employment alone.

This employment challenge has taken centre stage in the global community, most recently in the Report of the World Commission on the Social Dimension of Globalization, which drew attention to the need to make decent and productive employment a central objective of macroeconomic and social policies as a key endeavour to promote fairer globalization. Also, the centrality of decent employment to reaching the United Nations' Millennium Development Goals, particularly in halving the share of those in extreme poverty in the total population by 2015, is widely accepted and becoming more and more integrated as a component of national policy.

Given this backdrop, the World Employment Report 2004-05 examines the interrelationship between employment creation, productivity growth, and poverty reduction, exploring key issues relevant to the debate. It investigates whether gains in productivity lead to employment losses and, if so, the conditions under which this might occur. Given that productivity growth assumes a certain amount of flexibility of the labour force, this Report also examines how a particular degree of employment stability can be maintained without sacrificing long-term growth. Here, social dialogue plays a central role in maintaining the balance between economic and social objectives.

The report shows that bridging the "global productivity divide", particularly in parts of the economy where the majority of people work – such as in agriculture, small scale-enterprises or the urban informal economy - is essential for fighting poverty and stimulating growth in both output and "decent and productive" employment. Decent work has many components; the fundamentally economic one of an income adequate enough to escape from poverty, ultimately must come from growth – growth in output, growth in productivity, and growth in jobs.

The World Employment Report 2004-05 is the fifth in a series of ILO reports that offer a global perspective on current employment issues.

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