Faltering global employment growth and the pressure on decent working conditions risk undermining social justice
According to the ILO report "World Employment and Social Outlook: Trends 2023", workers may be forced to accept lower quality jobs as a result of the economic slowdown, insufficient global employment growth and the difficulty of promoting decent employment may put social justice at risk.
16 January 2023
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The ILO’s World Employment and Social Outlook: Trends 2023 (WESO Trends), also projects that global employment growth will be only 1.0 per cent in 2023, less than half the level in 2022. Global unemployment is slated to rise slightly in 2023, by around 3 million, to 208 million (corresponding to a global unemployment rate of 5.8 per cent). The moderate size of this projected increase is largely due to tight labour supply in high-income countries. This would mark a reversal of the decline in global unemployment seen between 2020-2022. It means that global unemployment will remain 16 million above the pre-crisis benchmark (set in 2019).
In addition to unemployment “job quality remains a key concern”, the report says, adding that “Decent Work is fundamental to social justice”. A decade of progress in poverty reduction faltered during the COVID-19 crisis . Despite a nascent recovery during 2021, the continuing shortage of better job opportunities is likely to worsen, the study says.
The current slowdown means that many workers will have to accept lower quality jobs, often at very low pay, sometimes with insufficient hours. Furthermore, as prices rise faster than nominal labour incomes, the cost-of-living crisis risks pushing more people into poverty. This trend comes on top of significant declines in income seen during the COVID-19 crisis, which in many countries affected low-income groups worst.
Women and young people are faring significantly worse in labour markets. Globally, the labour force participation rate of women stood at 47.4 per cent in 2022, compared with 72.3 per cent for men. This 24.9 percentage point gap means that for every economically inactive man there are two such women.
Young people (aged 15–24) face severe difficulties in finding and keeping decent employment. Their unemployment rate is three times that of adults. More than one-in-five – 23.5 per cent – of young people are not in employment, education or training (NEET).
“The need for more decent work and social justice is clear and urgent,” said ILO Director-General, Gilbert F. Houngbo. “But if we are to meet these multiple challenges, we must work together to create a new global social contract. The ILO will be campaigning for a Global Coalition for Social Justice to build support, create the policies needed, and prepare us for the future of work.”
“The slowdown in global employment growth means that we don’t expect the losses incurred during the COVID-19 crisis to be recovered before 2025,” said Richard Samans, Director of the ILO’s Research Department and report coordinator. “The slowdown in productivity growth is also a significant concern, as productivity is essential for addressing the interlinked crises we face in purchasing power, ecological sustainability and human well-being.”
In addition to unemployment “job quality remains a key concern”, the report says, adding that “Decent Work is fundamental to social justice”. A decade of progress in poverty reduction faltered during the COVID-19 crisis . Despite a nascent recovery during 2021, the continuing shortage of better job opportunities is likely to worsen, the study says.
The current slowdown means that many workers will have to accept lower quality jobs, often at very low pay, sometimes with insufficient hours. Furthermore, as prices rise faster than nominal labour incomes, the cost-of-living crisis risks pushing more people into poverty. This trend comes on top of significant declines in income seen during the COVID-19 crisis, which in many countries affected low-income groups worst.
Stagflation conditions threaten productivity and labour market recovery
The labour market deterioration is mainly due to emerging geopolitical tensions and the Ukraine conflict, uneven pandemic recovery, and continuing bottlenecks in global supply chains, the WESO Trends says. Together, these have created the conditions for stagflation – simultaneously high inflation and low growth – for the first time since the 1970s.Women and young people are faring significantly worse in labour markets. Globally, the labour force participation rate of women stood at 47.4 per cent in 2022, compared with 72.3 per cent for men. This 24.9 percentage point gap means that for every economically inactive man there are two such women.
Young people (aged 15–24) face severe difficulties in finding and keeping decent employment. Their unemployment rate is three times that of adults. More than one-in-five – 23.5 per cent – of young people are not in employment, education or training (NEET).
“The need for more decent work and social justice is clear and urgent,” said ILO Director-General, Gilbert F. Houngbo. “But if we are to meet these multiple challenges, we must work together to create a new global social contract. The ILO will be campaigning for a Global Coalition for Social Justice to build support, create the policies needed, and prepare us for the future of work.”
“The slowdown in global employment growth means that we don’t expect the losses incurred during the COVID-19 crisis to be recovered before 2025,” said Richard Samans, Director of the ILO’s Research Department and report coordinator. “The slowdown in productivity growth is also a significant concern, as productivity is essential for addressing the interlinked crises we face in purchasing power, ecological sustainability and human well-being.”
Unemployment will rise in Western Europe
In this regard, there are substantial variations in labour market prospects for 2023 at the regional level. Thus, while Africa and the Arab States are expected to see employment growth of at least 3 per cent in 2023, with slight decreases in unemployment, Europe and Central Asia are particularly affected by the economic effects of the conflict in Ukraine. Although employment is projected to decline in 2023, the unemployment rate in the region can be expected to increase only slightly, given the insufficient increase in the working-age population.Employment growth will slow significantly in 2023 as a result of numerous economic uncertainties and falling investment. In Western Europe, which had already recovered to pre-crisis employment levels in 2022, is expected to see stagnating employment growth and a slight rise in unemployment. Inflation coupled with the expected low economic growth, together with the war in Ukraine, will be the factors shaping the employment outlook in 2023."
Félix Peinado, Director of the ILO Office for Spain