The Middle East crisis: Activating social dialogue early matters

The Middle East crisis, and the disruptions it continues to generate for transport routes and economic activity, have sent shockwaves through the world of work and the wider global economy. Analysis from the International Labour Organization (ILO) shows that the effects are already spreading beyond the region, and energy prices, supply chain disruptions, weaker investor confidence and pressure on migration flows and remittances are placing jobs, incomes and working conditions under strain. According to the World Bank, growth is expected to slow down amid heightened uncertainty, higher commodity prices, stronger inflationary pressures and financial stress. Many governments have already begun responding through a range of fiscal, energy and social protection measures aimed at supporting business continuity, protecting households and mitigating the immediate economic impacts of the crisis, although the scope of these responses largely depends on available fiscal space.

But such a state of affairs does not prevent countries from taking additional action to help ensure that the needs of enterprises and workers are adequately addressed in crisis responses. In fact, experience from past crises – such as the financial shock of the late 2000s and the COVID-19 pandemic in early 2020 – provides good reasons for acting proactively and inclusively to design measures with a sharper focus on jobs and income. These crises showed how quickly external disruptions can translate into job losses, enterprise closures and rising inequality. They also demonstrated that countries which brought governments, employers and workers together early through social dialogue were generally better equipped to navigate the crisis and prevent durable setbacks for decent work.

Social dialogue – whether through negotiation, consultation or the exchange of information – brings governments, employers and workers together to identify common priorities, solve practical problems and develop responses that are both workable and broadly supported.

Timing matters. Economic shocks often take time to work through labour markets and enterprise activity, creating a narrow yet important window for action. Even as developments in the Middle East continue to unfold, activating social dialogue early is essential to designing and implementing responses that address both the immediate and emerging labour-market impacts of the crisis, as its effects continue to spread across sectors, industries and countries.

When social dialogue is activated early, measures to protect wages, jobs, incomes, small enterprises and vulnerable workers can be introduced before losses become entrenched, helping prevent temporary shocks from turning into lasting damage. When activation is delayed until labour-market conditions have already deteriorated, the risk of deeper and more persistent damage – including rising inequality and social unrest – increases. Importantly, there is no need to wait for the political dimensions of the Middle East crisis to be resolved before activating social dialogue. The labour-market and social consequences are already emerging, and institutions can begin addressing them now.

Different countries and sectors would of course require different types of interventions. Different industrial relations cultures may also privilege different forms of dialogue – negotiation, consultation, or information exchange, bipartite or tripartite. Yet the core social dialogue agenda in times of crisis is more often than not, similar across contexts. It typically includes protecting wages and incomes, managing working-time adjustments, strengthening occupational safety and health, extending social protection, supporting informal and migrant workers, refugees and displaced populations, and ensuring that recovery plans generate decent work opportunities.

The institutions needed to make this happen already exist in many countries. Where they are less developed or weak, the ILO stands ready to provide technical support, including under the ILO’s Employment and Decent Work for Peace and Resilience Recommendation, 2017 (No. 205). What is required is the political will to ensure their timely and effective use.

The response to the COVID-19 pandemic illustrates this point well. Across a wide range of countries, social dialogue, including collective bargaining, proved to be a practical and effective tool for managing disruption, even in regions where formal social dialogue institutions were historically less developed. At enterprise level, it helped firms adjust while preserving jobs and incomes through measures such as negotiated working-time reductions, temporary wage adjustments linked to employment guarantees and skills redeployment. At national level, engaging employers’ and workers’ organizations contributed to more coherent recovery responses, broader acceptance of difficult measures and more stable implementation. This should not come as a surprise. Major crises can act as a “federating” force, bringing together governments and social partners around a shared set of risks and a common objective: limiting their impacts.

Policymakers may understandably feel compelled to act unilaterally, or delay social dialogue, in the name of urgency. Yet crisis management is rarely a purely technical exercise. It involves difficult choices made in complex and rapidly evolving contexts, where multiple factors are at play. The way these choices are made directly shapes how risks and costs are distributed, how protection is extended, how competing policy priorities are balanced, and how recovery is shaped. Opting for inclusive policy making increases the likelihood that interests are aligned, responses are balanced, and solutions are adapted to rapidly evolving conditions. By contrast, crisis responses designed unilaterally can prove harder to implement and more socially costly, weakening industrial relations and social cohesion.

Early activation of social dialogue as part of the crisis response will not only help labour markets withstand this shock and recover more sustainably; it can also strengthen public trust in institutions and democratic participation at a time when both are under strain.